Summary
In Bhogaonker, there was a $4,000,000 budget reduction and no factual dispute that the termination was for economic reasons resulting in a reduction in force.
Summary of this case from Ewers v. Stroh Brewery Co.Opinion
Docket No. 93618.
Decided August 20, 1987. Leave to appeal denied, 429 Mich. 897.
Hurwitz, Karp, Hirschman Wallach, P.C. (by Martin Hirschman), for plaintiff.
Kitch, Saurbier, Drutchas, Wagner Kenney, P.C. (by Mark D. Willmarth and James D. Zazakis), for defendant.
Plaintiff, Dr. Anant B. Bhogaonker, appeals as of right from the orders entered by the trial judge granting defendant's motions for summary disposition and entering a judgment of no cause of action in favor of defendant. We affirm.
This case arises out of the termination of plaintiff's employment as a physician by defendant, Metropolitan Hospital. Plaintiff is a medical doctor licensed to practice in the State of Michigan. In November, 1974, when plaintiff was hired by defendant as a physician, defendant indicated that it would provide him with employment so long as his work was satisfactory. Plaintiff successfully completed the two-year probationary period specified in the medical staff by-laws of defendant hospital. He thereupon received a permanent appointment as of November, 1976, subject to termination only for good cause.
In 1981, plaintiff's employment was terminated by defendant because of a reduction in staff due to budget cuts. The 1981-82 expense budget of the hospital had to be reduced by $4,000,000. There was no factual dispute that plaintiff's employment was terminated because of economic reasons which resulted in staff reduction.
On May 9, 1984, plaintiff filed a complaint against defendant alleging that defendant terminated plaintiff's employment without cause and thus violated its contractual obligations. Plaintiff alleged five counts: breach of contract, estoppel, breach of covenant of good faith and fair dealing, negligence, and, alternatively, that defendant failed to give adequate notice of the termination and failed to pay all benefits due and owing to plaintiff upon termination.
Defendant subsequently filed motions for summary disposition pursuant to MCR 2.116(C)(4), (8) and (10), and, after hearings, the trial court ruled that it lacked subject matter jurisdiction and granted defendant's motions. Plaintiff claims that this ruling was in error.
We first note that even if the court's ruling that it lacked subject matter jurisdiction were erroneous, summary disposition would still have been proper under MCR 2.116(C)(10) as there was no dispute as to any material facts and defendant was entitled to judgment as a matter of law. Plaintiff did not and does not contest the economic necessity for the termination of his employment. As we explained in Friske v Jasinski Builders, Inc, 156 Mich. App. 468, 472; 402 N.W.2d 42 (1986):
Case law indicates that termination of the employment of an otherwise competent employee due to an economically motivated business closing is not grounds for a wrongful discharge claim. See, e.g., Bouwman v Chrysler Corp, 114 Mich. App. 670, 681-682; 319 N.W.2d 621 (1982), lv den 417 Mich. 989 (1983); Sahadi v Reynolds Chemical, 636 F.2d 1116, 1118 (CA 6, 1980); F S Royster Guano Co v Hall, 68 F.2d 533, 535 (CA 4, 1934). We find that these cases are analogous to the instant case and support a holding that, as a matter of law, plaintiff's discharge for economic reasons, as determined by and within the complete discretion of the board of directors of defendant corporation, constitutes termination for sufficient cause. To hold otherwise would impose an unworkable economic burden upon employers to stay in business to the point of bankruptcy in order to satisfy employment contracts and related agreements terminable only for good or sufficient cause.
See also J A Hackney Sons, Inc v National Labor Relations Bd, 426 F.2d 943 (CA 4, 1970).
In any event, we also agree with the trial court's determination that it lacked subject matter jurisdiction in this case. Although plaintiff alleged breach of contract in this case, it is clear beyond peradventure that plaintiff is actually seeking judicial intervention into a decision of a hospital to terminate his employment as a physician due to economic necessity. Such a decision is not subject to review by the circuit court. Hoffman v Garden City Hospital-Osteopathic, 115 Mich. App. 773, 778; 321 N.W.2d 810 (1982), lv den 417 Mich. 1027 (1983); Veldhuis v Central Michigan Community Hospital, 142 Mich. App. 243, 246; 369 N.W.2d 478 (1985), lv den 422 Mich. 970 (1985); Regualos v Community Hospital, 140 Mich. App. 455, 460-61; 364 N.W.2d 723 (1985).
Affirmed.