Mesa Airlines v. Condron, 1 CA-CV 16-0326

Mesa Airlines hired Paul Condron as an EMB-175 first officer contingent on FAA-required training; Condron lacked the necessary rating and accepted company-provided training.
Under a collective bargaining agreement (CBA), Mesa may require pilots with <4 years’ longevity to sign promissory notes to reimburse training costs; the CBA set Condron’s training obligation and amortization over 12 months.
Condron signed a Jet Training Event Promissory Note before employment; the Note recited value received, stated it did not alter at-will employment, and authorized Mesa to offset unpaid balance from compensation if he voluntarily left within 12 months.
Condron completed training, flew 12 hours, then resigned; Mesa withheld $764.08 from his final paycheck and sued for the remaining balance when he did not pay.
The superior court granted summary judgment for Mesa, finding the Note a stand-alone, enforceable contract (not a penalty nor an improper modification of at-will status) and awarded fees; Condron appealed.

Issue	Condron's Argument	Mesa's Argument	Held
Whether the promissory Note is part of the employment contract	Note was integrated with the oral employment agreement and thus impermissibly modified it	Note is a separate, stand-alone contract supported by offer, acceptance, consideration, and CBA authorization	Note is a separate contract; enforceable as written
Whether the Note unlawfully modified at-will employment	Note effectively forced a 12-month employment commitment or penalized early resignation	Note expressly preserved at-will status and provided repayment alternatives; CBA and statute permit written modifications	Even if it modified at-will status, the modification was voluntary and permitted; Note did not alter at-will rights
Whether the Note is an unenforceable penalty/liquidated-damages	The Note functions as a penalty for quitting and is contrary to public policy	Note reimburses reasonable training costs and is not a penalty; comparable authorities uphold training-repayment agreements	Note is not an unenforceable penalty; it secures repayment of training costs and is enforceable
Whether Mesa could deduct unpaid balance from wages	Withholding wages violated Arizona wage statutes because the Note is void	The Note contained prior written authorization permitting offset under A.R.S. § 23-352(2)	Mesa lawfully offset wages per the Note’s signed authorization; no wage-law violation

Schade v. Diethrich, 158 Ariz. 1 (1988) (formation of contract requires mutual assent; foundational on intent to contract)
Demasse v. ITT Corp., 194 Ariz. 500 (1999) (parties may alter at-will relationship by contract; presumption of at-will can be overcome)
Jeski v. Am. Express Co., 147 Ariz. 19 (1985) (whether a separate provision becomes part of employment contract is factual; personnel manuals not dispositive if disclaimers exist)
Orme Sch. v. Reeves, 166 Ariz. 301 (1990) (summary judgment standard and appellate review principles)
Gordon v. City of Oakland, 627 F.3d 1092 (9th Cir. 2010) (upholding employer’s recovery of training costs where conditions satisfied)