Johnny Wilson v. Clark Atlanta University, Inc.
339 Ga. App. 814
| Ga. Ct. App. | 2016Background
- Clark Atlanta University declared an "enrollment emergency" in Jan. 2009 and laid off 54 faculty (four tenured, one tenure-track among the five plaintiffs) during the 2008–09 year.
- Plaintiffs sued for breach of their one-page employment contracts (which referenced the Faculty Handbook), seeking lost wages/benefits, reinstatement, and attorney fees under OCGA § 13-6-11 for alleged bad-faith manufacture of the enrollment emergency.
- The Faculty Handbook set out tenure protections (annual renewal unless cause) and separate procedures for "enrollment emergency" and "financial exigency," the latter providing a one-year severance/notice scheme. The handbook also stated it "shall not be construed as a legally binding contract."
- The trial court denied CAU summary judgment, held the financial exigency severance clause was an enforceable "additional compensation plan," and limited plaintiffs’ contract damages to the financial-exigency severance if jury found bad faith in declaring an enrollment emergency.
- A jury found breach of contract and bad faith (OCGA § 13-6-11); plaintiffs also recovered other discrete damages; the university moved for JNOV, which was denied.
- The Court of Appeals affirmed liability (breach and bad faith) but vacated and remanded for a new trial solely on (1) breach-of-contract damages (beyond the limited severance figure) and (2) attorney fees allocation under OCGA § 13-6-11.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Faculty Handbook (tenure provisions) is part of the parties' contract | Handbook defines scope of "tenured/tenure-track" protections referenced in one-page contracts; parol evidence and handbook govern tenure scope | Handbook disclaimed contractual effect; one-page contracts did not incorporate handbook obligations for the university | Handbook tenure provisions define the scope of tenure protections in the one-page contracts (handbook used to interpret those contract terms) |
| Whether damages were correctly limited to financial-exigency severance if jury found bad faith in declaring an enrollment emergency | Plaintiffs: substantive contract breach allows full compensatory damages (lost wages/benefits, career injury); not limited to the financial-exigency severance clause | CAU: summary judgment construed the severance clause as the only enforceable compensation term — thus damages limited to that severance | Court of Appeals: trial court erred; plaintiffs are entitled to full compensatory damages for breach; remand for new trial on damages |
| Whether CAU breached contract by declaring an enrollment emergency (and whether JNOV was proper) | Plaintiffs: declaration was not in good faith; decline wasn’t "sudden or unplanned" nor "too great or too rapid" per handbook definition | CAU: president had discretion after consultation; decision entitled to deference as academic judgment; at least made in good faith | Sufficient evidence for jury; denial of JNOV was proper — jury could find lack of good faith and thus breach |
| Whether OCGA § 13-6-11 attorney-fees award should stand | Plaintiffs: CAU acted in bad faith, justifying fee award | CAU: if mistaken judgment or poor forecasting, not bad faith; award unsupported | Court: liability for bad faith may be supported by evidence, but fee award vacated because plaintiffs failed to segregate fees attributable to the contract claim they won; remand to re-try/segregate fees |
Key Cases Cited
- Moffie v. Oglethorpe Univ., 186 Ga. App. 328 (Ga. Ct. App. 1988) (faculty handbook provisions may form part of employment contract as additional compensation plan)
- Town Center Assocs. v. Workman, 227 Ga. App. 55 (Ga. Ct. App. 1997) (incorporation by reference requires reasonably clear, ascertainable meaning)
- Roca Props. v. Dance Hotlanta, 327 Ga. App. 700 (Ga. Ct. App. 2014) (contract construction and parol-evidence rules)
- Akron Pest Control v. Radar Exterminating Co., 216 Ga. App. 495 (Ga. Ct. App. 1995) (use of dictionaries and ordinary meaning in contract interpretation)
- Board of Regents v. Ambati, 299 Ga. App. 804 (Ga. Ct. App. 2009) (plaintiff must prove breach and damages with sufficient evidence for jury to estimate compensatory damages)
- Savannah Coll. of Art & Design v. Nulph, 265 Ga. 662 (Ga. 1995) (compensatory damages available for substantive breach of employment contract)
- Planning Techs. v. Korman, 290 Ga. App. 715 (Ga. Ct. App. 2008) (standard for implied duty of good faith where contract grants discretion)
- Charles v. Leavitt, 264 Ga. 160 (Ga. 1994) ("sole judge" language creates absolute discretion and defeats implied good-faith duty)
- Automatic Sprinkler Corp. v. Anderson, 243 Ga. 867 (Ga. 1979) (examples of absolute contractual discretion)
- ULQ, LLC v. Meder, 293 Ga. App. 176 (Ga. Ct. App. 2008) (discretion constrained by contract language implies good-faith duty)
- Regents of Univ. of Michigan v. Ewing, 474 U.S. 214 (U.S. 1985) (courts defer to academic judgments in certain university decisions)
- Moeti v. Clark Atlanta Univ., 282 Ga. 164 (Ga. 2007) (remedy for internal university-management disputes is damages, not injunction)
- Oglethorpe Power Corp. v. Estate of Forrister, 332 Ga. App. 693 (Ga. Ct. App. 2015) (OCGA § 13-6-11 bad-faith standard and fee-award principles)
- Jones v. Chatham County, 223 Ga. App. 455 (Ga. Ct. App. 1996) (personnel manual alone does not necessarily create a contract)