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Magula v. Benton Franklin Title Co.

January 30, 1997

KATHRYN A. MAGULA, RESPONDENT,
v.
BENTON FRANKLIN TITLE COMPANY, INC., PETITIONER.



Appeal from Superior Court, Benton County. 92-2-00986-0. Honorable Duane E. Taber, Judge.

Authored by Philip A. Talmadge. Concurring: James M. Dolliver, Charles Z. Smith, Richard P. Guy, Charles W. Johnson, Gerry L. Alexander. Dissenting: Barbara Durham, Richard B. Sanders, Barbara A. Madsen.

The opinion of the court was delivered by: Talmadge

EN BANC

TALMADGE, J. -- Kathryn Magula was discharged after 14 years of employment because of the alleged misconduct of her spouse, an independent contractor for the same firm. Although RCW 49.60.020 proscribes discrimination based on marital status and RCW 49.60.180 declares marital status discrimination to be an unfair practice, a definition of "marital status" did not appear in our Law Against Discrimination at the time of the events in this case. Magula contends marital status discrimination includes action against an employee based on the conduct of that employee's spouse. Magula's employer contends marital status discrimination is confined to action based on the institution of marriage itself.

In this case, we hold marital status discrimination may pertain to situations where the identity and conduct of the employee's spouse are involved. We affirm the Court of Appeals and remand this case to the Benton County Superior Court for further proceedings.

ISSUES

1. Where an employee is discharged for reasons unrelated to the employee's performance and because of the alleged conduct of the employee's spouse, does such a discharge constitute marital status discrimination?

2. Did the trial court properly grant Benton Franklin Title Insurance Co.'s (BFT) motion for summary judgment?

FACTS

BFT hired Kathryn Magula in 1978. By 1991, she had become the head of the firm's escrow department. During this period, her husband, Pat Magula, provided janitorial services for BFT as an independent contractor.

In the fall of 1991, Kathryn Magula perceived tension in the office and the animosity of fellow employees. On November 20, 1991, she took escrow department employee Linda Hendler out to lunch and asked why their relationship was so tense and strained. Hendler told Kathryn it was the Magulas' fault another employee had been fired the month before and that Pat Magula was having or had had affairs with several women at the office. She also stated other employees thought he "did not live life by the rules." Clerk's Papers at 456. Kathryn was greatly distressed by this conversation, which she reported to her supervisor, BFT manager Greg Bowers. Bowers began to keep a diary of office events.

The next day, Hendler informed Bowers Pat Magula had made a threatening phone call to her, and had followed her and her daughter to school. Hendler's ex-husband, Jeff, told Bowers he was concerned for the safety of Linda and their children. Linda Hendler obtained a restraining order against Pat Magula.

Kathryn Magula admitted in her deposition there was animosity in the office during this period. She indicated the conversation with Hendler made their already strained relationship even worse. Bowers testified the conflict between Linda and Kathryn adversely affected their performance in the escrow department, although he did not record any specific incidents of Kathryn's negative office performance in his diary. Bowers told Kathryn, Linda, and Pat the situation was no-win for all concerned, and was adversely affecting BFT. He told them unless everyone could rise above the interpersonal conflict and work together, he would dismiss all parties involved. To ensure compliance with the restraining order Hendler had obtained against Pat Magula, Bowers also told Pat not to come to BFT any more.

On December 9, 1991, Hendler reported to Bowers she was upset and unable to work because Pat Magula had telephoned her and made obscene suggestions. She also said her friends had seen comments freshly written on several men's restroom walls in clubs in the area stating she had HIV. Hendler attributed the graffiti to Pat Magula.

Bowers believed this news was a "crushing blow" to the possibility Kathryn and Linda could work together. Clerk's Papers at 431. On December 10, he met with Pat Magula and said he "would not Judge who is right or wrong" in the accusations, but he terminated BFT's contract with Pat. Id. at 62. Bowers met separately with Kathryn and Linda and terminated their employment because he did not think they could work together.

Kathryn sued BFT, asserting BFT breached express and implied promises of employment, committed the tort of outrageous conduct, or wrongfully discharged her in violation of public policy as set forth in RCW 49.60, including marital status discrimination under RCW 49.60.180. BFT moved for summary judgment, arguing its action did not involve marital status discrimination because the discharge did not turn on Kathryn's marriage or the identity of her spouse. However, BFT did not address the issue of whether Magula's discharge was a "business necessity" within the meaning of WAC 162-16-150. Kathryn argued marital status discrimination includes being discharged for the misconduct of a spouse, and admitted Pat Magula had engaged in misconduct. Report of Proceedings at 9-15.

The trial court granted summary judgment for BFT on all claims, stating firing someone because of the conduct of the spouse was not marital status discrimination. On appeal, the Court of Appeals, Division Three, affirmed the trial court's rulings on all other claims, but reversed and remanded as to the marital status discrimination claim, stating the evidence created an issue as to whether Ms. Magula was terminated based on her spouse's conduct:

The record discloses that the circumstances surrounding termination of Ms. Magula's employment related to allegations of misconduct by her husband. There are no allegations of misconduct by Ms. Magula. The evidence creates a genuine issue of fact whether Ms. Magula was discriminated against based on who her spouse was, his conduct or what he did. Magula v. Benton Franklin Title Ins. Co., 79 Wash. App. 1, 4, 901 P.2d 313 (1995). We granted review. *fn1

ANALYSIS A.

Marital Status A prima facie case of marital status discrimination requires a plaintiff to prove "(1) that the employer discriminated against her based on her marital status and (2) that this discrimination was not justified or excused by 'business necessity'." Kastanis v. Educational Employees Credit Union, 122 Wash. 2d 483, 493, 859 P.2d 26 (1993), amended, 865 P.2d 507 (1994). Marital status must be a substantial factor in the employer's adverse employment decision. MacKay v. Acorn Custom Cabinetry, Inc., 127 Wash. 2d 302, 310, 898 P.2d 284 (1995). The parties have focused solely on the definition of "marital status"; Magula has not addressed, nor has BFT argued at this point in the case, whether Magula's termination was a "business necessity." *fn2 It is unlawful for any employer to discharge a person from employment "because of . . . marital status." RCW 49.60.180. See also RCW 49.60.010, .020. The Legislature added marital status to the list of protected attributes in RCW 49.60 in 1973, but provided no definition of the term "marital status." Laws of 1973, ch. 141, sec. 10. In 1993, the Legislature defined "marital status," as "the legal status of being married, single, separated, divorced, or widowed." Laws of 1993, ch. 510, sec. 4.

Prior to 1993, Washington law employed a broad definition of "marital status" under RCW 49.60. Although RCW 49.60 did not define "marital status," the Human Rights Commission promulgated WAC 162-16-150 in 1975, defining marital status discrimination. WAC 162-16-150(2) specifically provides:

In general, discrimination against an employee or applicant for employment because of (a) what a ...


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