author: RYAN, District Judge.

text:
    AETNA CASUALTY & SURETY COMPANY, a corporation, Plaintiff, v. Carl M. FAIRCHILD, John Francis Richards, Terry F. Kerr, Lana L. Kerr, and/or Carl M. Fairchild and Carl O. Fairchild, d/b/a Division I, American Universal Insurance Company and May Trucking Company, an Idaho corporation, Defendants. and Lela Robinson and Shanna Christopherson, Intervenors. GRANITE STATE INSURANCE COMPANY, a corporation, Plaintiff in Intervention, v. AETNA CASUALTY & SURETY COMPANY, a corporation, Carl M. Fairchild, John Francis Richards, and May Trucking Company, an Idaho corporation, Defendants in Intervention.
    Civ. No. 83-1509.
    United States District Court, D. Idaho.
    Oct. 23, 1985.

      R.B. Fading, Jr., Howard W. Carsman, Eberle Berlin Fading Turnbow & Gillespie, Boise, Idaho, for Aetna Cas. & Sur. Co.
    Gregory R. Giometti, Quane Smith Howard & Hull, Boise, Idaho, for American Universal Ins. Co.
    Charles F. McDevitt, Givens McDevitt Pursley Webb & Buser, Boise, Idaho, for May Trucking Co.
    John C. Hohnhorst, Hepworth Nungester & Felton, Twin Falls, Idaho, for Robinson and Christopherson.
    R.B. Rock, Firk B. Helvie, Moffatt Thomas Barrett & Blanton, Boise, Idaho, for Granite State Ins. Co.
   MEMORANDUM OPINION

RYAN, District Judge.

I. INTRODUCTION

This declaratory judgment action arises from an automobile accident occurring on September 28, 1981, in Lemhi County, Idaho. The accident involved a collision between a 1973 Fenworth tractor/trailer rig and a passenger car. The truck was driven by Francis Richards, an employee of Carl M. Fairchild who was a passenger in the truck at the time of the accident. The driver of the car was killed in the accident and the passenger injured. The occupants of the car brought a personal injury suit in state court against Carl M. Fairchild and John Richards, as drivers of the vehicle, as well as May Trucking Company, an interstate motor carrier who had leased the truck from Fairchild. The state court granted summary judgment in favor of May Trucking Company holding May Trucking could not be liable for the conduct of either Richards or Fairchild at the time of the accident.

Jurisdiction is based upon diversity of citizenship. The plaintiff, Aetna Casualty & Surety Company (Aetna), as the insurance carrier for May Trucking, seeks a declaration that it is under no duty or obligation to defend the state court action on behalf of the remaining defendants, Fair-child and Richards, or to assume liability for any judgment which may be entered against those defendants. Aetna also seeks a declaration that Defendant American Universal Insurance Company (American) is obligated to defend and indemnify Fairchild and Richards in the state court action.

Plaintiffs in the state court action, Lela Robinson and Shanna Christopherson, have intervened seeking a declaration that both Aetna and American are obligated to defend and indemnify Fairchild and Richards, as well as a declaration that May Trucking is vicariously liable for the conduct of Fair-child and Richards. Intervenor Granite State Insurance Company (Granite) provides excess or umbrella coverage to May Trucking and seeks a declaration that it is not obligated to provide coverage to Fair-child, Richards or May Trucking. All parties have moved for summary judgment.

The pending motions for summary judgment raise three basic issues:

(1)If and to what extent the state court summary judgment in favor of May Trucking is binding on the parties in this action (and if not, the liability of May Trucking for the conduct of Fairchild and Richards);
(2) Whether Aetna and Granite are obligated to defend and indemnify Fairchild and Richards; and
(3) Whether American is obligated to defend and indemnify Fairchild and Richards.

II. FACTS

The following facts are not in dispute. May Trucking is a corporation headquartered in Payette, Idaho, which is engaged in the interstate carriage of cargo for hire. May Trucking holds interstate transporta-tional certification from the United States Interstate Commerce Commission (ICC). On May 26, 1981, May Trucking entered into a lease agreement entitled, “Owner/Operator Contract” with Carl M. Fair-child whereby May Trucking leased a 1973 Kenworth tractor and alloy trailer owned by Fairchild. The lease agreement generally provided May Trucking with the exclusive use, possession and control of Fair-child’s truck. Fairchild and his employees were authorized to operate the rig in exchange for which Fairchild would share in the fees or commissions earned from such operations. This lease agreement remained in effect during all times relevant to this action.

In late September 1981, Fairchild drove the truck from May Trucking’s business premises in Payette, Idaho, to his parents’ home in Stevensville, Montana. According to Fairchild, the purpose for taking the truck to Stevensville was to perform repairs on the truck’s engine. Fairchild informed May Trucking that this was the reason for removing the truck from Pay-ette.

Fairchild’s father, Carl A. Fairchild, was the owner of a business known as Division One, located in Stevensville, Montana. Division One engaged in the business of shipping precut log homes. Apparently in exchange for the repairs completed on the truck by his father, Fairchild and an employee, John Francis Richards, used the 1973 Kenworth to transport a precut log home from Alpine, Montana, to Ketchum, Idaho, on behalf of Division One.

After completing delivery of the logs, Fairchild and Richards, with Fairchild driving, began the return trip to Stevensville on State Highway 93. At a point north of Challis, Idaho, the parties changed drivers. At a point near Ellis, Idaho, the truck collided with a car driven by Russell Robinson. As a result of the collision, Robinson died and Shanna Christopherson, a passenger in the car, was injured. The accident occurred on September 28, 1981. At the time of the accident, the 1973 Kenworth carried the identification placards of May Trucking.

At the time of the accident, Aetna had in effect a trucker’s policy of insurance issued to May Trucking and Granite had in effect an umbrella liability policy issued to May Trucking providing coverage in excess of that afforded by the Aetna policy.

Carl M. Fairchild was the named insured in a liability insurance policy issued by American, bearing effective dates May 13, 1981, to May 13, 1982. On September 28, 1981, neither the 1973 Kenworth tractor nor the flatbed trailer involved in the accident was listed as a covered auto under the American policy. On October 19, 1981, Fairchild’s father requested American add the 1973 Kenworth to the policy. Fair-child’s father, Carl A. Fairchild, did not inform American of the accident which had occurred on September 28, 1981, involving the 1973 Kenworth. Pursuant to Carl A. Fairchild’s request and upon his representations that Division One was a certified interstate motor carrier, American added the 1973 Kenworth truck to the policy and issued public liability endorsements to comply with the insurance requirements of the ICC regulations. Neither Carl M. Fairchild nor Carl A. Fairchild ever notified American of the occurrence of the accident on September 28, 1981. There is no dispute, however, that Carl M. Fairchild was aware of the accident since he was a passenger in the truck when it occurred and was arrested while driving the vehicle shortly afterward.

For a considerable time after the accident, Fairchild and Richards maintained that they had not been involved in any accident on September 28, 1981. In fact, Richards’ defense to criminal charges brought as a result of the accident was that he had not been involved in any such accident. Richards was subsequently convicted by a jury of involuntary manslaughter stemming from the September 28,1981, accident.

III. COLLATERAL ESTOPPEL EFFECT OF THE STATE COURT SUMMARY JUDGMENT

The collateral estoppel effect of a state court judgment in a subsequent diversity action brought in federal court is generally determined by the law of the state in which the judgment is entered. See 18 C. Wright, A. Miller and E. Cooper, Federal Practice and Procedure: Jurisdiction § 4472 (1981). Idaho has adopted the Restatement (Second) of Judgments’ definition of collateral estoppel (issue preclusion). Carpenter v. Double R Cattle Company, Inc., 105 Idaho 320, 669 P.2d 643 (Ct.App.1983); see also Aldape v. Akins, 105 Idaho 254, 668 P.2d 130 (Ct.App.1983).

The Restatement (Second) of Judgments § 27 (1980) provides:

Issue Preclusion — General Rule When an issue of fact or law is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, the determination is conclusive in a subsequent action between the parties, whether on the same or a different claim.

The court finds that the summary judgment entered in the state court is not a “final judgment,” and therefore, the summary judgment granted by the state court is not binding on the parties in this action.

Rule 54(b) of the Idaho Rules of Civil Procedure provides that the entry of partial summary judgment will be a final judgment only when expressly so certified by the trial court. In the absence of such certification, the entry of partial summary judgment does not terminate the action as to any of the claims or parties and leaves the decision open to revision at any time before the entry of judgment adjudicating all claims of all parties. Idaho R.Civ.P. 54(b). Because the state court decision remains subject to revision and does not terminate those claims which are the subject of the summary judgment, entry of the partial summary judgment does not constitute final judgment for purposes of collateral estoppel.

In Dawson v. Mead, 98 Idaho 1, 557 P.2d 595 (1976), the Idaho Supreme Court held that an order granting partial summary judgment is not a final judgment for purposes of res judicata because such a ruling, if uncertified, is subject to later revision under Rule 54(b). Id. at 3, 557 P.2d at 597. While the facts in Dawson suggest the trial court may have simply exercised its ability to revise a previously entered partial summary judgment, and therefore, the doctrines of collateral estoppel or res judicata were not strictly applicable, the decision does evidence the Idaho Supreme Court’s recognition that the requirements of Rule 54(b) must be met for the entry of final judgment as applied to the doctrines of collateral estoppel and res judicata.

Several other factors support the conclusion that the state court’s partial summary judgment is not a final judgment. In Standefer v. United States, 447 U.S. 10, 100 S.Ct. 1999, 64 L.Ed.2d 689 (1980), the United States Supreme Court stated:

Under contemporary principles of collateral estoppel, this factor [absence of appellate review] strongly militates against giving an acquittal preclusive effect. See Restatement (Second) of Judgments § 68.1 (Tent Draft No. 3, 1976) (denying preclusive effect to an unreviewable judgment).

Id. at 23, 100 S.Ct. at 2007. While the Standefer decision was a criminal case whose holding is not directly applicable to this action, the Court emphasized the importance of appellate review in bolstering the underlying confidence in any decision made in the initial litigation. The same concern is reflected in the Ninth Circuit’s decision in Luben Industries, Inc. v. United States, 707 F.2d 1037 (1983). The court stated:

The District Court in the present case stated that the Bristol [Corp. v. U.S., CV-78-1759 FW (C.D.Cal. May 22, 1984)] interlocutory opinion should not be given preclusive effect because “[a]s an interlocutory order it is subject to free revision by the court on its own motion or on motion of any party at any time before judgment.” Furthermore, although the Bristol opinion does not appear to be tentative, it could not have been the subject of an appeal at the time the instant case was decided in the District Court. We are satisfied that the District Court acted well within its discretion in determining the Bristol memorandum was not sufficiently firm to give it collateral estoppel effect.
Moreover, we are convinced that the Government did not have a “full and fair opportunity to litigate” its claim because it could not appeal the interlocutory memorandum in Bristol.

Id. at 1040. In this case, the state court ruling is not appealable under Rule 54(b), thus undermining any conclusion that the state court decision is substantially correct.

Finally, three exceptions to the general rule of issue preclusion recognized by the Restatement (Second) of Judgments are applicable. First, the party against whom preclusion is sought in this case could not, as a matter of law, have obtained review of the judgment in the state court action. Restatement (Second) of Judgments § 28(1) (1980). Second, the issue is one of law and a new determination is warranted to avoid an inequitable administration of the laws. Restatement (Second) of Judgments § 28(2)(b) (1980). This exception is applicable because the state court rejected well-established federal law imposing liability on ICC certified carriers for accidents involving leased vehicles whether or not those vehicles were being used on carrier business. See discussion infra at page 1250. Third, there is a clear and convincing need for a new determination of the issue because of the potential adverse impact of the determination on the public interest or the interest of persons not themselves parties in the initial action. Restatement (Second) of Judgments § 28(5)(a) (1980). There can be no question that the effect of the state court’s decision on the motoring public in Idaho is both adverse and substantial. The decision effectively represents a step backward to the time when common law rules of agency governed the liability of interstate carriers. Congress has made it abundantly clear that the traditional common law rules of agency no longer govern interstate carrier liability. Recognition of the state court decision by this court would thwart the clear intent of Congress and adversely impact the motoring public in the State of Idaho.

This court is neither required to give collateral estoppel effect to the state court’s partial summary judgment, nor would the interests of justice be served by such an estoppel.

IV. LIABILITY OF MAY TRUCKING

There is now little doubt that the provisions of the Interstate Commerce Act and the regulations promulgated thereunder impose liability on May Trucking as a certified lessee/interstate carrier for any accidents involving a vehicle under lease to May. See 49 U.S.C. §§ 10821(a) (1982), 10927(a)(1) (1982), 11107(a) (1982), and 49 C.F.R. §§ 1043.1 (1984), 1057.12(1) (1984); e.g. Price v. Westmoreland, 727 F.2d 494 (5th Cir.1984); Rodriguez v. Ager, 705 F.2d 1229 (10th Cir.1983); Carolina Casualty Insurance Co. v. Insurance Company of North America, 595 F.2d 128 (3d Cir.1979); Wellman v. Liberty Mutual Insurance Co., 496 F.2d 131 (8th Cir.1974). The Tenth Circuit’s decision in Rodriguez v. Ager reviews not only the case law in support of this proposition, but also those few cases which have rejected statutorily imposed liability. In its discussion of those cases refusing to adopt the theory of statutory liability, the Tenth Circuit found those cases unable to cite precedential authority in support of their conclusions, nor were those conclusions based upon sound reasoning. This court is persuaded by the Tenth Circuit’s analysis rejecting the minority view and finds that May Trucking is subject to statutorily imposed liability for the accident which is the subject of this action.

May Trucking is a named insured under the Aetna policy, and therefore, Aet-na will be obligated to defend and indemnify May Trucking in any action arising from the accident. The Aetna policy does not expressly provide coverage for this statutorily imposed liability. However, the policy was issued pursuant to and in compliance with 49 C.F.R. § 1043 (1984). Similarly, Granite is obligated to indemnify May Trucking as a named insured in the umbrella policy issued to May Trucking.

V. COVERAGE OF FAIRCHILD AND RICHARDS UNDER THE AETNA POLICY

A. Statutory Coverage

Defendant American and Intervenors Robinson and Christopherson argue the policy underlying the public liability provisions of the Interstate Commerce Act and regulations governing interstate motor carriers mandate Fairchild and Richards be considered insureds under the Aetna policy issued to May Trucking. Notwithstanding intervenors’ conclusion that “it is exceedingly clear that the cases and decisions involving identical or similar facts, and identical or similar insurance policy provisions, uniformly require the conclusion that the Aetna policy provided coverage to Fair-child and Richards,” only one case has been cited in support of this proposition which is truly on point. See Cosmopolitan Mutual Insurance Co. v. White, 336 F.Supp. 92 (D.Del.1972). While many courts have adopted the position that the lessee/carrier is liable for the conduct of an owner/operator as long as the truck is being operated under lease, few cases have addressed the issue of the lessee/carrier’s insurance policy providing direct coverage to the owner/operator and only one case has held such coverage exists.

The basis for the court’s decision in Cosmopolitan is a determination that the ICC regulations require a particular construction of the language in the carrier’s insurance policy. That court interpreted “exclusively in the business of the insured” as being expanded by the ICC regulations to include any operation of the truck while it is still under lease (meaning the lease has not been effectively terminated).

Whereas, Aetna’s coverage of May Trucking is based upon the statutorily imposed liability of May Trucking for Fair-child, and Richards’ conduct, the court in Cosmopolitan held that the language of the lessee/cárrier’s insurance policy provided direct coverage for the conduct of the lessor/owner. This was accomplished through the expansive reading of the language of the insurance contract between the insurance company and the lessee/earrier. Such an expansive interpretation was justified by the Delaware district court’s determination that it was necessary to effectuate the policies underlying the control and insurance requirements of the ICC regulations. This analysis is not based upon sound logic, nor is the extension of coverage beyond the lessee/carrier to include a lessor/owner (not otherwise covered by the carrier’s insurance policy) necessary to effectuate the policies underlying the statutorily imposed control and insurance requirements.

In Wellman v. Liberty Mutual Insurance Company, 496 F.2d 131 (8th Cir.1974), the court analyzed the Cosmopolitan decision and noted the error in the analysis used in that case. The Eighth Circuit stated:

We cannot accept this logic as it relates to insurance coverage. The fact that an owner-operator displays the carrier’s permit number while hauling an unauthorized load for a company other than the I.C.C. carrier does not make the trip one “exclusively in the business” of the insured, although the insured motor carrier remains liable to third parties during the entire term of the vehicle lease. The language of the insurance policy must be given its ordinary meaning unless good reason appears for doing otherwise. The relevant I.C.C. regulation on insurance, 49 C.F.R. § 1043, contains no provision which would require a motor carrier specifically to carry insurance affording liability coverage for judgments rendered solely against an owner-operator of a vehicle leased to the motor carrier. In the absence of such a provision, we think it unreasonable to apply 49 C.F.R. § 1057.4 and the public policies of the Interstate Commerce Act, as a gloss to the exclusionary provisions of the insurance policy in this case. We do not think that such broad coverage could reasonably have been contemplated by the parties when they formed their insurance contract.... It is one thing to hold that a motor carrier is absolutely liable — based on the Interstate Commerce Act — for injuries resulting from the negligent operation of vehicles leased to it, but it seems an unjustified and illogical leap to hold that an insurance company — whose sole obligation rests on contract— should be bound to pay a judgment for others who are not mentioned in the I.C.C. insurance regulation (49 C.F.R. § 1043.1), and who are specifically excluded by the language of the policy.

Id. at 138-39 (emphasis added) (footnotes omitted).

In a similar context, the Third Circuit Court of Appeals made the following observations:

[T]he pertinent question is whether the federal policy of assuring compensation for loss to the public prevents courts from examining the manner in which private agreements or state laws would otherwise allocate the ultimate financial burden of the injury.
While the lessee cannot free itself of its federally imposed duties when protection of the public is at stake, the federal requirements are not so radically intrusive as to absolve lessors or their insurers of otherwise existing obligations under applicable state tort law doctrines ... or under contracts allocating financial risk among private parties.... [WJhere the case is “concerned with responsibility as between insurance carriers” and not with the federal policy of protecting the public, “I.C.C. considerations are not determinative” and a court should consider the express terms of the parties’ contracts....

Carolina Casualty Insurance Co. v. Insurance Company of North America, 595 F.2d 128, 138 (3d Cir.1979) (quoting Allstate Insurance Co. v. Liberty Mutual Insurance Co., 368 F.2d 121, 125 (3d Cir.1966)) (emphasis added) (footnotes omitted). These eases provide strong support for the proposition that where the goal of protecting the injured public has been achieved through the imposition of vicarious liability on the lessee/carrier, a court may give effect to the contractual allocations of financial responsibility.

The analysis used by the court in Cosmopolitan suffers from an additional flaw. That case relies upon the terms of the contract of insurance between the lessee/carrier and its insurance carrier. Yet the terms of this contract have absolutely no bearing on the question of who will be liable to a member of the public injured as a result of the negligent operation of a vehicle under lease to the carrier. That question is clearly and in a straightforward manner answered by 49 U.S.C. § 11107(a) (1982) and 49 C.F.R. § 1057.12(d) (1984). When the carrier’s vicarious liability created by these provisions is combined with the insurance requirements of 49 U.S.C. § 10927(a)(1) (1982) and 49 C.F.R. § 1043(l)(a) (1984), the statutory goal of protection of the motoring public is achieved. The only relevance the terms of a contract of insurance have to this determination is that they must satisfy the regulatory bonding requirements prior to issuance of ICC certification. It necessarily follows that where, as here, the carrier has valid ICC certification, the terms of the contract of insurance have no bearing whatsoever on the statutorily imposed liability. Where ICC certification has been granted, the ICC carrier’s insurance policy, by definition, provides coverage for statutorily imposed vicarious liability on the part of that carrier.

The only purpose served by resorting to what can only be described as a tortured interpretation of the insurance contract is to include the owner/operator and his employees with the lessee/carrier’s coverage, thus, guaranteeing two defendants (but only one insurer) with insurance coverage amenable to suit by the injured person, rather than one. What little benefit, if any, might be achieved by providing two insured defendants subject to suit, can be arrived at only by blatantly changing the terms of the contract between insured and insurer. This is simply insufficient justification for undermining the consensual undertaking of rights and duties by contracting parties — the basic foundation of contract law.

The court finds the policies upon which the control and insurance requirements of the ICC regulations are based will not transform the contract of insurance entered into between Aetna and May Trucking into a contract of insurance between Aetna and Carl M. Fairchild. If coverage is to be extended to Fairchild under the Aetna policy, it must be done so under the plain language of that policy.

B. Liability based upon the contract of insurance.

It is well-established in Idaho that the language of an insurance contract, in the absence of ambiguity, must be construed as any other contract and understood in its plain, ordinary and proper sense according to the meaning derived from the plain wording of the contract. Juker v. American Livestock Insurance Co., 102 Idaho 644, 637 P.2d 792 (1981). Part IV, subsection D, of the Aetna policy enumerates what persons are insured under that policy. If a person falls within any one of the subsections D(l)-(5), they are an insured under the policy (with the exception of several specific exclusions not applicable here). Only three of the five subsections are applicable in this case:

D. WHO IS INSURED.
1. You are an insured for any covered auto.
2. Anyone else is an insured while using with your permission a covered auto you own, hire or borrow except:
4. The owner or anyone else from whom you hire or borrow a covered auto which is not a trailer is an insured while the covered auto:
a. Is being used exclusively in your business, and
b. Is being used over a route or territory you are authorized to serve by public authority or on its way to that route at your request.
1. Fairchild and Richards as Named Insureds

“You” as used in Section D(l) includes all named insureds listed in special No. 1. Special No. 1 provides that owners/operators are named insureds “while actually operating, pursuant to the lease contract with May Trucking Company.” Even though the owner/operator contract between May Trucking and Fairchild does not expressly prohibit Fairchild’s use of the truck absent May Trucking’s authorization, such a prohibition is implicit in a number of the provisions of the contract.

Paragraph 1(A) provides: “Contractor shall furnish to Carrier, exclusively during the term of this agreement, the [1973 Ken-worth] .... ” (emphasis added) Further, paragraph 2(A) provides: “During the entire term hereof, the sole possession, responsibility for, and control of the vehicular equipment described hereinabove shall reside in Carrier.” The clear import of these provisions requires the owner/operator to obtain authorization from May Trucking prior to using the truck for any purpose. Absent such authorization, the truck is not being used “pursuant to the lease contract with May Trucking Company.” As noted below, an issue of fact exists as to whether the Fairchilds had permission or authorization to use the truck.

2. Permissive use.

Part IV, paragraph D(2) of the Aetna policy provides coverage to Fairchild if he was using the truck with May Trucking’s permission. In Idaho, such permission may be either express or implied. Idaho Code § 49-1521(b)(2); Farm Bureau Mutual Insurance Company of Idaho v. Hmelevsky, 97 Idaho 46, 539 P.2d 598 (1975). Although Carl M. Fairchild’s deposition testimony is conflicting, he does state that he informed the dispatcher of his trip to Ketchum and that May Trucking did not object to that trip. From this it might be concluded that May impliedly gave Fairchild permission to proceed on the trip to Ketchum.

Aetna has submitted both deposition and affidavit testimony indicating May Trucking had no knowledge of Fairchild’s trip to Ketchum. Consequently, a dispute of fact exists as to the existence of permission, express or implied, given by May Trucking to Fairchild to proceed with a load of logs to Ketchum.

3. Use exclusively in May Trucking’s business.

Part IV, paragraph D(4) provides that anyone from whom May Trucking hires the use of a tractor is an insured so long as the tractor is being used exclusively in May Trucking’s business. While there may be a dispute of fact as to Fair-child’s having implied permission to make the haul to Ketchum, there is no dispute but that Fairchild proceeded on his own business and was not, therefore, engaged exclusively in the business of May Trucking. As a result, Fairchild is not an insured under this provision of the Aetna policy.

VI. COVERAGE OF FAIRCHILD AND RICHARDS UNDER THE GRANITE POLICY

Potential coverage for Fairchild and Richards can be found in the Granite policy in only two respects. First, as “any person ... to whom the Named Assured is obligated by virtue of a written contract or agreement to provide insurance such as is afforded by this policy, but only in respect of operations by or on behalf of the Named Assured....” Granite policy, definitions, paragraph 1(b). Coverage under this provision, like the Aetna policy, requires an interpretation of the language “operations by or on behalf of the Named Assured.” As noted earlier, the purpose for the bonding requirements of the regulations governing interstate motor carriers is satisfied by imposing liability on May Trucking and, therefore, must not be utilized in interpreting the insurance contracts. Fairchild was not operating by or on behalf of May at the time of the accident. Hence, Fairchild and Richards are not covered under paragraph 1(b) of the Granite policy.

Second, paragraph 1(c) of the definitions section provides coverage for “any additional assured (not being the Named Assured under this policy) included in the underlying insurances.... ” This leads back to the Aetna policy as the underlying insurance — if Fairchild and/or Richards is/are covered there as permissive users, they will also be covered under the Granite policy.

VII. COVERAGE OF FAIRCHILD AND RICHARDS UNDER THE AMERICAN POLICY

Carl M. Fairchild was the named insured under a policy issued by American in effect at the time of the accident. This coverage is generally limited to certain vehicles. The 1973 Kenworth tractor involved in the accident was not added to Fairchild’s policy with American until October 19, 1981, some three weeks after the accident. Consequently, if coverage under the American policy exists, it must exist under the public liability endorsement issued December 3, 1981, antedated to become effective July 1, 1981. There is no question that Carl M. Fairchild is covered by the American policy for the accident if the public liability endorsement was in ef-feet at the time of the accident.

It appears to be well-established that: [Wjhere one applies for insurance knowing that a loss has already occurred, conceals this fact, and procures a policy to be antedated so as to cover the period when the loss did occur, the policy is void because of the fraud or concealment.... 4 Appleman, Insurance Law and Practice § 2291 (1969); 43 Am.Jur.2d, Insurance, § 328 (1969); Annot., 132 A.L.R. 1325 (1941).

Aetna Casualty & Surety Co. v. Condict, 417 F.Supp. 63, 71 (S.D.Miss.1976). Fair-child’s failure to inform American of the occurrence of the accident, therefore, renders the antedated public liability endorsement void.

VIII. CONCLUSION

Having determined that the parties to this action are not bound by the determinations made by the state court in its order granting partial summary judgment in favor of May Trucking, the court finds May Trucking is liable, as a matter of law, for any negligence on the part of Fairchild and Richards which may have caused the accident occurring on September 28, 1981. 49 U.S.C. §§ 10321(a) (1982), 10927(a)(1) (1982), 11107(a) (1982), and 49 C.F.R. §§ 1043.1 (1984), 1057.12(1) (1984), and cases cited at page 1250 supra.

The policy of liability insurance issued by Aetna and Granite to May Trucking does not extend coverage to Fairchild or Richards for the accident occurring on September 28, 1981, unless May Trucking is found to have given its permission, either express or implied, for Fairchild’s use of the truck at that time.

The court makes no findings regarding the potential coverage of Richards under either the Aetna or Granite policy should it be determined that only Fairchild had permission to use the truck on the night of the accident.

American’s antedated public liability endorsement being void due to fraud relieves American of any obligation to defend or indemnify Fairchild or Richards.

       This is not to suggest that the availability of appellate review is always an essential predicate of estoppel. See Johnson Co. v. Wharton, 152 US 252, 38 L Ed 429, 14 S Ct 608 (1894); see generally IB J Moore & T Currier, Moore's Federal Practice ¶ 0,416[5] (2d ed 1974). The estoppel doctrine, however, is premised upon an underlying confidence that the result achieved in the initial litigation was substantially correct. In the absence of appellate review, or of similar procedures, such confidence is often unwarranted.

      . The parties do not dispute that the 1973 Ken-worth tractor was under lease to May Trucking at the time of the accident, nor is there any dispute as to the fact that May Trucking held and maintained ICC certification during all times relevant to this action.

      . Title 49 C.F.R. § 1043.1 (1984) requires an insurance policy issued to a motor carrier subject to the provisions of the Interstate Commerce Act include an endorsement providing for public liability coverage. While the Aetna policy issued to May Trucking did not include this endorsement, Aetna does not dispute that the policy was issued and filed with the ICC in an effort to comply with the statutory insurance requirements. Consequently, Aetna concedes the terms of the required endorsement are implicitly included in the policy even though that endorsement was not physically attached to the policy.

      . The court is aware of only three cases which address this issue. Cosmopolitan Mutual Insurance Co. v. White, 336 F.Supp. 92 (D.Del.1972); Wellman v. Liberty Mutual Insurance Company, 496 F.2d 131 (8th Cir.1974); Carolina Casualty Insurance Co. v. Insurance Company of North America, 595 F.2d 128 (3d Cir.1979). All three cases are discussed infra.

      . It must be noted that earlier in its decision, the Wellman court stated that the reasoning of the Cosmopolitan decision and similar cases justified construing a general "persons insured” section of the lessee/carrier’s policy broadly to include as permissive use any operation of the subject vehicle so long as the lessee/carrier’s ICC permit numbers were displayed on that vehicle. This statement is inconsistent with the court’s subsequent holding, noted above, and in any event, was unnecessary to the court’s decision and is obitur dictum.

       Accordingly, even though the tractor-trailer accident there occurred during the term of the lease, analysis of the insurance contracts led to the conclusion that the lessor’s insurer expressly extended coverage to the loss and thus should bear financial responsibility for it. Accord, Wellman v. Liberty Mutual Insurance Co., 496 F.2d 131, 139 (8th Cir.1974) (ICC regulations may not be read into insurance contract to require lessee's insurer to pay judgment against lessor, whom the contract had expressly excluded from coverage); see Consolidated Systems, Inc. v. Allstate Insurance Co., 411 F.2d 157 (5th Cir.1969) (lessee’s insurer not estopped by federal regulations to deny primary coverage as against lessor’s insurer); cf. Carolina Casualty Insurance Co. v. Pennsylvania Thresherman's & Farmers Mutual Casualty Insurance Co., 327 F.2d 324, 326 (3d Cir.1964) (state motor carrier financial responsibility law not controlling in action between two insurers). The general principle upon which these cases rest — that a court may give effect to otherwise existing allocations of financial responsibility where the goal of protecting the injured public has already been fulfilled — appears to find affirmance in Trans-american. There the Supreme Court held that "[ajlthough one party is required by law to ... bear the consequences of any negligence, the party responsible in law may seek indemnity from the party responsible in fact," pursuant to a hold-harmless agreement. [Transamerican Freight Lines, Inc. v. Brada Miller Freight Systems, Inc.] 423 U.S. [28] at 40, 96 S.Ct. [229] at 235 [46 L.Ed.2d 169 (1975)].

      . This, of course, presupposes May Trucking's vicarious liability for the accident. Realistically, such liability as it might benefit the state court plaintiffs (injured public) is nonexistent because the state court has ruled such vicarious liability does not attach. However, the state court's misinterpretation of the law in this regard cannot provide a sound basis for extending insurance coverage to persons not otherwise covered. Further, this court is confident the state trial court’s error will be corrected on reconsideration or an appeal.

      . Title 49 C.F.R. § 1043.1 (1984) only requires public liability insurance coverage for “final judgment recovered against any such motor carrier_” The regulations do not require insurance coverage for the lessor/owner.

      . Subsequent to oral argument in this matter, Aetna submitted an affidavit indicating American had knowledge of the accident prior to issuance of the public liability endorsement. Filing of the affidavit was not timely and the affidavit has not been considered by the court. Aetna, of course, is free to seek reconsideration if it feels such knowledge on the part of American somehow favorably impacts the validity of the public liability endorsement.


source: Caselaw Access Project

author: NORGLE, District Judge.

license: Public Domain

text:
    COUNTY OF COOK, Plaintiff, v. Joan LYNCH, et al., Defendant.
    No. 81 C 5985.
    United States District Court, N.D. Illinois, E.D.
    Oct. 28, 1985.
    Mark R. Davis, Asst. State’s Atty., and Richard M. Daley, State’s Atty. of Cook County, Chicago, Ill., for plaintiff.
    John A. Dienner, II, Matthias A. Lydon, Pierce, Lydon, Griffin & Montana, Chicago, Ill., for defendant.
   ORDER

NORGLE, District Judge.

After a jury trial in 1981, Joan Lynch (“LYNCH”) was convicted of participating in a conspiracy to obtain fraudulent real estate tax assessment reductions in violation of the Racketeer Influence and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(d). The “pattern of racketeering activity” with which Lynch was charged consisted of “multiple acts of bribery and mail fraud, involving payments of money to Jimmie Smith, James Woodlock and other officials at the Board of [Tax] Appeals.” Indictment, U.S. v. Lynch, # 84 CR 97, at Count 14,116. Her conviction was affirmed by the Seventh Circuit Court of Appeals in September of 1982, United States v. Lynch, 699 F.2d 839 (C.A.7 1982). While Lynch’s appeal was pending, the County of Cook (“COUNTY”) filed this suit to recover treble damages under § 1964(c) of RICO (Count I) and an equitable accounting by Lynch (Count II). Judge Decker granted the County’s motion for partial summary judgment on Count I and summary judgment on Count II. County of Cook v. Lynch, 560 F.Supp. 136, 140-41 (N.D.Ill.1982).

In granting the County’s motion for partial summary judgment on Count I, Judge Decker held that Lynch’s prior conviction under § 1962(d) estopped her from denying liability in the County’s civil suit. 560' F.Supp. at 140. At the same time, however, Judge Decker noted the burden of establishing the “remaining elements of liability under 18 U.S.C. § 1964(c), i.e., that (1) the Plaintiff was injured in its business or property (2) by reason of the Defendant’s violation of Section 1962” remained with the County. Id. The County now uses Lynch’s conviction under § 1962(d) and Judge Decker’s grant of partial summary judgment as the basis for its present motion for summary judgment on the remainder of Count I — the § 1964(c) claim for treble damages.

The County maintains it was injured in its business or property by reason of Lynch’s violation of RICO because it was forced to pay for the services of two corrupt officials (Woodlock and Smith) which were never performed. Lynch does not deny that such an injury is cognizable under § 1964(c). E.g., Hellenic Lines Ltd. v. O’Hearn, 523 F.Supp. 244, 248 (S.D.N.Y.1981). Nor does Lynch disagree that the County’s injury resulted from a violation of RICO.

The County suggests the proper measure of damages in this case is the entire salaries of the two corrupt officials during the period of the bribery scheme. This measure of damages is drawn from the common law remedy provided by Illinois courts for a tortious interference with an employment contract. E.g., ABC Trans National Transport v. Aeronautics Forwarders, 413 N.E.2d 1299 (1st Dist 1980); Vendo Co. v. Stoner, 58 Ill.2d 289, 321 N.E.2d 1 (1974). See also NSC International Corp. v. Ryan, 531 F.Supp. 362, 363 (N.D.Ill.1981) (on issue of availability of jury trial in civil RICO action; court found civil RICO “most closely resembles an action for tortious interference with economic relations”). Strictly speaking, Lynch does not object to the County’s position that its damages under RICO should be measured with reference to the common law remedy for a tor-tious interference with contract. See Deft’s Memo at 9. See generally Sutherland Statutory Construction § 50.01 et seq. (4th ed. 1984). She does argue, however, that the County has failed to meet its burden under Fed.R.Civ.P. 56 and that she cannot be held liable for damages caused by other independent conspirators. The former argument raises issues involving the County’s use of collateral estoppel in this action; the latter argument raises the issue of whether Lynch may be held liable for damages potentially resulting from the acts of other independent conspirators. This opinion first discusses the issues raised by the County’s theory of damages and then proceeds to determine the reach, if any, of collateral estoppel in this lawsuit. DAMAGES

The County maintains the proper measure of damages in this case is supplied by analogy to the remedy provided for the common law tort of intentional interference with contract. The remedy provided by Illinois courts for a tortious interference with an employment contract is the entire amount of the disloyal employee’s salary during the period of disloyalty. See ABC, supra, at 1315. The caselaw does not make an allowance in damages for a disloyal employee’s periodic loyalty. The entire salary is forfeited under the rationale that the employer is paying for all of the disloyal employee’s performance and not just part of it. ABC, id,., at 1314, 1315. The same result could be reached on a breach of fiduciary duty theory. See Monotronics Corp. v. Baylor, 107 Ill.App.3d 14, 62 Ill.Dec. 760, 765, 436 N.E.2d 1062, 1067 (2d Dist.1982). Thus, if several parties conspire to interfere with an employer/employee contract, they will be jointly and severally liable for the entire salary of the disloyal employee. There can be no apportionment of damages among co-conspirators. Lynch does not dispute this.

Lynch contends that she was not the only person paying bribes to Woodlock and Smith. She names various persons (“on information and belief”) who were making payments to the two Board members and insists that those independent payments were made without her knowledge or participation. Deft’s Memo at 7-8. From this Lynch argues she may not be held jointly and severally liable for the conduct of persons with whom she neither conspired nor acted in concert. In essence, Lynch argues she is only liable for only a portion of the County’s damages because others were also paying bribes to Woodlock and Smith. Such an argument suggests damages in this case can and should be apportioned.

The County maintains that its damages are not susceptible to apportionment among all potential defendants. Consequently, because apportionment is not possible, Lynch may be held solely liable for its entire damages notwithstanding the existence of independent bribery schemes involving other potential defendants. See generally Prosser and Keeton on Torts § 52 (1984) (“PROSSER & KEETON”).

Ordinarily a tort plaintiff bears the burden of proof of his damages as to each defendant. However, where the independent, successive acts of several tort-feasors result in an indivisible injury to the plaintiff, then the burden of proof shifts and the tort-feasors are required to bear the burden of proving any reasonable apportionment of damages. To do otherwise would penalize an innocent plaintiff merely because his injury was caused by several tort-feasors. Thus, if the County’s damages are indivisible, the burden of apportioning damages rests with Lynch. Her inability to carry that burden will result in liability for the entirety of the County’s damages. This principle is applied most frequently in personal injury cases (e.g., Phennah v. Whalen, 28 Wash.App. 19, 621 P.2d 1304, 1309-10 (1980)), but it also has been applied in other contexts as well (e.g., Ricky Smith Pontiac v. Surbaru of New England, 14 Mass.App. 396, 440 N.E.2d 29 (1982) (unfair and deceptive trade practices in violation of state statute)).

The issue, therefore, is whether the County’s damages are subject to any rational apportionment among the several independent tort-feasors. Illinois caselaw (c.f. Monotronics Corp. v. Baylor, 107 Ill.App.3d 14, 62 Ill.Dec. 760, 765, 436 N.E.2d 1062, 1067 (2d Dist.1982)) and The Restatement (Second) Torts (“RESTATEMENT”) suggest the County’s injury (deprivation of the loyal services of its employees resulting from an intentional interference with contractual relations) is not the kind of injury which is capable of apportionment.

Section 433A of the Restatement states the rule for apportionment of damages among two or more causes:

(1) Damages for harm are to be apportioned among two or more causes where
(a) There are distinct harms, or
(b) There is a reasonable basis for determining the contribution of each cause to a single harm.

Section 433B(2) shifts the burden of proof that damages can be apportioned to the defendant whenever two or more tort-fea-sors have caused the plaintiff's injury and one of the defendants seeks to limit his liability. Consequently, if a defendant attempting to claim the benefits of apportionment fails to meet his burden, the full responsibility for plaintiffs injury will fall upon him. Comment (d) to section 433B states the basis for the rule:

The reason for the exceptional rule placing the burden of proof as to the apportionment upon the defendant ... is the injustice of allowing a proved wrongdoer who has in fact caused harm which he has inflicted has combined with similar harm inflicted by other wrongdoers, and the nature of the harm itself has made it necessary that evidence be produced before it can be apportioned. In such a case the defendant may justly be required to assume the burden of producing that evidence, or if he is not able to do so, of bearing the full responsibility. As between the proved tort-feasor who has clearly caused some harm, and the innocent plaintiff, any hardship due to lack of evidence as to the extent of the harm caused should fall upon the former.

Consideration of the two elements identified in § 433A of the Restatement suggests the County’s injury cannot be apportioned. Moreover, the remedy provided by Illinois courts for a tortious interference with contract (forfeiture of the disloyal employee’s salary during the period of disloyalty) convinces the Court that Lynch cannot meet her burden of establishing a rational means of apportionment of damages in this case. See Restatement, § 433B(2).

As a practical matter, the very nature of the County’s injury (deprivation of the loyal services of its employees over a 5 year period) prevents any distinction between the harm caused by Lynch’s wrongful acts (participation in the scheme to bribe Board Officials over the five year period) and other independent, but similar, wrongful acts. The injury to the County, when one of its officials accepts a bribe as part of a continuing conspiracy, can only be described as a continuing injury. The disloyalty caused by the scheme in which Lynch participated spanned a five year period and she may not now isolate each payment to an official in order to reduce her liability for each of those years. See Prosser & Keeton, supra, at 347-48.

Similarly, there is no reasonable basis for determining the portion of damages attributable to each independent tort-feasor. See Restatement § 433A(1)(B). The disloyalty caused by the scheme with which Lynch was charged spanned a five year period. In measuring the County’s damages it is not the individual acts of bribery which require focus, but the prolonged, continuous scheme over the five year period. Consequently, Lynch may not now argue that because she was able to turn Woodlock and Smith on and off like a light switch for her individual cases, her liability should be limited to those individual bribery transactions. The possibility that others performed the same acts independent of Lynch is irrelevant to the continuous nature of the injury caused by Lynch. The County’s injury resulting from Lynch’s conduct progressed from the beginning of the scheme to its end without any breaks in between.

Further, the remedy provided by Illinois law for a tortious interference with contract (in this context an employment contract) also militates against apportionment of damages in this case. The damages provided by Illinois courts is equal to the entire amount of the disloyal employee’s salary during the period of the disloyalty. It is the payment of the salary for the employee’s misperformance that is the basis for the remedy, not, as Lynch suggests, the isolated acts of disloyalty. Thus, Lynch may be held liable for the salaries of Woodlock and Smith over the entire period of the bribery scheme without any apportionment for persons who may have performed similar, but independent acts of bribery. Having addressed Lynch’s arguments regarding her potential liability, the focus now shifts to the reach (if any) of collateral estoppel in this lawsuit. COLLATERAL ESTOPPEL

Collateral estoppel precludes the relit-igation of issues which were actually litigated and necessarily determined in a previous lawsuit. Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 n. 5, 99 S.Ct. 645, 649 n. 5, 58 L.Ed.2d 552 (1979). The first element, actual ligation of an issue, reflects a due process concern that the party es-topped must have had a full opportunity to litigate an issue before he is estopped from denying its resolution. The second element, that the issue was necessarily determined, assures the issue decided was sufficiently important in the prior case to command the full attention of the party es-topped. Thus, the Court’s obligation is to determine exactly what was put in issue and directly determined in the prior criminal prosecution. Emich Motors Corp. v. General Motors Corp., 340 U.S. 558, 560, 71 S.Ct. 408, 410, 95 L.Ed. 534 (1951). The fundamental consideration, however, is whether application of collateral estoppel would be fair to the defendant. Parklane Hosiery, supra, 439 U.S. at 331, 99 S.Ct. at 651-52.

In order to determine the exact issues decided, the record of the prior criminal prosecution must be examined “including the pleadings, the evidence submitted, the instructions under which the jury arrived at its verdict, and any opinions of the courts.” Emich, supra, 340 U.S. at 569, 71 S.Ct. at 414. In support of its motion for summary judgment the County has submitted copies of 1) the 14 count indictment against Lynch (dated November 1978) and 2) the “Judgment and Probation/Commitment Order” pertaining to Lynch’s conviction. The County has also directed the Court’s attention to the Seventh Circuit’s resolution of Lynch’s appeal from her conviction (United States v. Lynch, 699 F.2d 839 (C.A.7 1982)). The County has not submitted a transcript of Lynch’s trial, nor has it provided a set of the instructions given to the jury. For the following reasons the Court finds the submissions by the County in support of its motion do not provide a sufficient basis for granting summary judgment in its favor on the collateral estoppel issues.

Initially Lynch argues that it is not possible to ascertain from the indictment whether the jury found she engaged in mail fraud, or bribery, or both offenses. The Court agrees. Paragraph 6 of Count 14 of the Lynch indictment charges Lynch knowingly conducted and participated in the affairs of an enterprise (the R.M. Lynch Company) “through a pattern of racketeering activity by committing multiple acts of bribery and mail fraud” involving payments of money to Woodlock and Smith, (emphasis added) There is no question that it was entirely proper for the government to draft Count 14 using the conjunctive “and” (e.g., “bribery and mail fraud”). E.g., U.S. v. McCann, 465 F.2d 147, 161 (C.A.5 1972). But drafting an indictment in this manner renders collateral estoppel in a later civil action rather problematic.

When an indictment charges several different ways, in the conjunctive, of committing an offense, then a conviction may be sustained if there is proof of any one (or more) of the means of commission. United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 249, 60 S.Ct. 811, 855-56, 84 L.Ed. 1129 (1940); United States v. Murph, 707 F.2d 895, 896-97 (C.A.6 1983); Fields v. United States, 408 F.2d 885, 887 (C.A.5 1969). See also United States v. Austin, 99 F.R.D. 292, 298-99 (W.D.Mich.1983). Thus, in making its determination that Lynch was guilty on Count 14, the jury may have found she committed mail fraud, or bribery, or both. Consequently, the indictment does not provide a basis from which the Court may determine the exact issues decided at Lynch’s criminal trial.

The County makes much of the fact that Lynch appealed her conviction and the Seventh Circuit affirmed it. 699 F.2d at 839. But, as will become clear, collateral estop-pel does not necessarily follow from the affirmance of a conviction. See e.g., Anderson v. Janovich, 543 F.Supp. 1124, 1132-34 (W.D.Wa.1982).

On appeal, Lynch argued her conviction was not supported by substantial evidence because the Government’s evidence “hardly implicate[d] her in the bribery scheme.” 699 F.2d at 841. After a review of the evidence presented at trial, the Court of Appeals concluded that Lynch had knowledge of and participated in the scheme to bribe Woodlock and Smith both before and after her husband’s death. 699 F.2d at 841, 842-43. Specifically the Court of Appeals noted that Lynch’s company essentially “functioned by bribing the employees at the [Tax] Board to forge” documents and that Lynch personally paid Woodlock $500 in cash. Id. at 841. Moreover, Lynch admitted paying Woodlock and Smith more than $3000. Id. at 842. The Court of Appeals concluded that “substantial evidence supported the conclusion that [Lynch] knew of the [bribery] scheme and participated in it.” Id. at 843. Although the findings and conclusions of the Court of Appeals do not bode well for Lynch, that decision (standing alone) cannot provide the sole basis for determining the reach of collateral estoppel in this lawsuit. “[I]t is the judgment, properly construed in the light of the pertinent facts, that creates the potential for estoppel, not the appellate decision affirming it.” Kurek v. Pleasure Driveway & Park Dist. of Peoria, 583 F.2d 378, 380 (C.A.7 1978). As the Court has previously pointed out, the County chose not to submit a copy of the transcript of Lynch’s criminal trial in support of the motion for summary judgment. Yet, that transcript is the most likely repository of the “pertinent facts” in this case. Thus, in failing to provide a transcript of Lynch’s trial the County has failed to provide this Court with an adequate basis for determi-nating the precise facts and issues established at Lynch’s criminal trial. Consequently, the County’s motion for summary judgment must be denied.

Although it is a closer contest, the same fate befalls the County’s attempt to establish the time frame for Lynch’s involvement in the charged bribery scheme. Both parties agree that it is the County’s burden on summary judgment to pinpoint the beginning and end of Lynch’s participation in the bribery scheme as an element of its damage theory. In other words, the County may only receive damages for the period of time it was deprived of the loyal services of its employees. See Vendo v. Stoner, 58 Ill.2d 289, 321 N.E.2d 1 (1974); ABC Trans National Transport v. Aeronautics Forwarders, 413 N.E.2d 1299 (1st Dist.1980) (salary forfeiture of disloyal employee limited to specific time period of employee’s breach of duty). Lynch contends the County has not met its burden because “it is impossible to know ... the inclusive dates of the [charged] bribery scheme.” That contention is too imprecise and is rejected.

Paragraph 6 of Count 14, on which the jury returned a verdict of guilty, charges Lynch with participation in the bribery scheme “[b]eginning in or around August, 1975, and continuing until in or about August, 1980.” Lynch appears to have recognized the explicit time frame of the indictment in her arguments before the Court of Appeals. See 699 F.2d at 843. The nature of the remedy in this case {see ABC, supra ) does not require any more exactitude than that stated in the indictment {viz. the County is entitled to the entire salaries of Woodlock and Smith for each year they accepted bribes, even if bribes were accepted for only part of a year). Thus, it is not (as Lynch argues) “impossible” to pinpoint the time frame involved here. The record provided by the County is simply inadequate to support collateral estoppel.

In sum, then, the County’s motion for summary judgment must be denied at this time because of its failure to provide an adequate record from which this Court may determine the precise issues (and facts) determined in Lynch’s criminal trial. The County is therefore ordered to provide sworn and verified copies of the following to the Court within 60 days; Lynch may have an additional 14 days to respond if she desires:

(1) the pleadings, transcripts and jury instructions from Lynch’s criminal prosecution;
(2) a proposed Order specifying the facts which Lynch is collaterally estopped from relitigating as a result of her criminal conviction (e.g., that Lynch bribed Woodlock and Smith);
(3) an index to the proposed Order in # 2 above containing page references to the testimony in the transcript for each fact which the County contends Lynch is es-topped from relitigating.

IT IS SO ORDERED.


author: MORAN, District Judge.

text:
    David HARRIS, Plaintiff, v. Alvin D. MOYER, James M. Cole, Robert E. Walker, Brian R. Perryman, Frances Falkowski, and Thomas Farris, individually and in their official capacities with the Department of Justice, Immigration and Naturalization Service, and the United States Department of Justice, Immigration and Naturalization Service, Defendants.
    No. 85 C 2228.
    United States District Court, N.D. Illinois, E.D.
    Oct. 23, 1985.
    Douglas P. Roller, Chicago, Ill., for plaintiff.
    Jack Penca, U.S. Asst. Atty., Chicago, Ill., for defendants.
   MEMORANDUM AND ORDER

MORAN, District Judge.

Plaintiff David Harris was discharged from a probationary appointment with the Immigration and Naturalization Service (INS) under somewhat unusual circumstances which he claims violated his constitutional and common law rights. Defendants have moved to dismiss the complaint on the grounds that the Civil Service Reform Act of 1978 (CSRA), 5 U.S.C. § 1101 et seq., provides plaintiff with a comprehensive scheme of remedies and therefore that this court has no subject matter jurisdiction. Because the court disagrees with how defendants characterize the CSRA, it denies their motion to dismiss.

I.

On November 14, 1982, the INS hired Harris to train him to be a criminal investigator. He was placed on probationary status for a year, as are all trainees. According to his complaint, which the court must accept as true for present purposes, Harris received average or above average scores on all his evaluations. On October 12, 1983, Harris received his Conduct and Efficiency Report prepared by his training officer, Mr. Rockwell, which recommended the INS retain Harris because he had the ability to do an outstanding job. However, on November 5, 1983, defendant Moyer, District Director of the INS in charge of making final appointments, discharged Harris on the grounds that he had (1) poor judgment relating to a citizen complaint; (2) overly authoritarian demeanor; (3) difficulty in mastering Spanish; and (4) unsatisfactory ability to express himself in writing.

Plaintiff claims that these reasons were pretextual and made in an attempt to save a senator from embarrassment. The senator’s nephew was in the same training program as Harris and had difficulty with several phases of the training program. Plaintiff asserts that by October 1983 it was common knowledge in the training program that the nephew had failed the final examination and would be terminated. Plaintiff also claims that the senator personally called defendant Moyer to discuss his nephew’s future. Feeling pressured from the senator, Moyer decided to fire at least one other criminal investigator along with the nephew, figuring this would keep the senator from feeling that his nephew had been singled out. Plaintiff claims this was the real reason behind his being fired.

Plaintiff appealed his dismissal to the Merit System Protection Board, which found that the agency’s explanation of his termination • was “unworthy of credence and pretextual.” The INS has appealed this finding to the United States Court of Appeals for the Federal Circuit, arguing that the Board was without jurisdiction to hear plaintiff’s claims because he was a probationary employee.

In the meantime, plaintiff has filed this lawsuit in federal district court. In count I he claims defendant deprived him of his liberty and property interest in his reputation and job for partisan political reasons, in violation of the Fifth Amendment; in count II he asks for punitive damages on count I violations; in count III he claims defamation; and in count IV he claims breach of his employment contract.

II.

In their motion to dismiss defendants make one argument: that the provisions of the CSRA protecting government employees against arbitrary actions by their superiors create a comprehensive scheme of remedies which precludes judicial remedies. In Bush v. Lucas, 462 U.S. 367, 103 S.Ct. 2404, 76 L.Ed.2d 648 (1983), the Supreme Court held that a federal employee did not have a judicial remedy for a First Amendment claim because

[fjederal civil servants are now protected by an elaborate, comprehensive scheme that encompasses substantive provisions forbidding arbitrary action by supervisors and procedures — administrative and judicial — by which improper action may be redressed. They apply to a multitude of personnel decisions that are made daily by federal agencies.

462 U.S. at 385, 103 S.Ct. at 2415. However, the Court noted that probationary employees are not “covered by this system.” Id. at 385 n. 28, 103 S.Ct. at 2415 n. 28.

The Court has provided for remedies against federal officials directly under the Constitution, when no other relief is available. See Bivens v. Six Unknown Fed. Narcotics Agents, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971); Davis v. Passman, 442 U.S. 228, 99 S.Ct. 2264, 60 L.Ed.2d 846 (1979); Carlson v. Green, 446 U.S. 14, 100 S.Ct. 1468, 64 L.Ed.2d 15 (1980). In Carlson, the Court stated that

[s]uch a cause of action may be defeated ... in two situations. The first is when defendants demonstrate “special factors counselling hesitation in the absence of affirmative action by Congress.” [Bivens v. Six Unknown Fed. Narcotics Agents] 403 U.S. at 396 [91 S.Ct. at 2004]; Davis v. Passman, 442 U.S. 228, 245 [99 S.Ct. 2264, 2277, 60 L.Ed.2d 846] (1979). The second is when defendants show that Congress had provided an alternative remedy which it explicitly declared to be a substitute for recovery directly under the Constitution and viewed as equally effective. Bivens, supra, at 397 [91 S.Ct. at 2005]; Davis v. Passman, supra, at 245-247 [99 S.Ct. at 2277-2278],

446 U.S. at 18-19, 100 S.Ct. at 1471-1472. While some language in Bush indicates the Court rested on the fact that Congress had created an equally effective remedial scheme in the CSRA, other passages suggest the Court grounded its decision on the presence of “special factors counseling hesitation,” particularly the historical attention Congress had paid to the problem of balancing federal employees’ First Amendment rights with the government’s interest in an efficient operation.

Whatever the basis of the Bush decision, the court finds it does not control the present case. As a probationary employee plaintiff had extremely limited rights to administrative review which did not even cover his constitutional denial of due process claims. He had no statutory right to appeal to the Merit System Protection Board, 5 U.S.C. §§ 7511 and 7512. At most, he had a limited right conferred by regulation to appeal to the Board respecting allegations that his discharge was due to discrimination on the basis of marital status or for partisan political reasons. 5 C.F.R. § 315.806. See Mastriano v. Federal Aviation Administration, 714 F.2d 1152, 1155 (Fed.Cir.1983); Piskadlo v. Veterans’ Administration, Merit Systems Protection Board, 668 F.2d 82 (1st Cir.1982).

Under these circumstances courts have granted federal jurisdiction over probationary employees’ constitutional claims. Egger v. Phillips, 710 F.2d 292 (7th Cir.), cert. denied 464 U.S. 918, 104 S.Ct. 284, 78 L.Ed.2d 262 (1983); Borrell v. United States International Communications Agency, 682 F.2d 981 (D.C.Cir.1982); Gemmell v. Federal Aviation Administration, 558 F.Supp. 918 (D.D.C.1982). As the court recognized in Gemmell, “[i]f this Court refuses to hear plaintiffs’ constitutional claims there will be no forum available to them.” 558 F.Supp. at 920. This “here or nowhere” reality was a strong motivating factor behind the original Bivens decision to allow private rights of action against federal officials based on the Constitution. Bivens, 403 U.S. at 410, 91 S.Ct. at 2011 (Harlan, J., concurring).

The Seventh Circuit, in Egger, discussed the two Carlson exceptions to a Bivens action in the context of the discharge of an FBI employee. The court considered the fact that Congress had not provided an alternative statutory remedy, “a factor in favor of recognizing Bivens claims.” 710 F.2d at 297. Appellees argued there as defendants do here that Congress’ explicit exemption of a certain group from statutory protections was its statement that this group should not be given federal remedies. The court rejected this contention, stating that

[t]he exemption, however, is a far cry from the “explicit congressional declaration” that would be necessary to preclude a group from their only avenue for vindicating particular deprivations of their constitutional rights.

710 F.2d at 298. Harris’ situation under the CRSA is sufficiently similar to that which the Seventh Circuit found in Egger for us to hold that case controls the present action.

III.

It is well, however, to emphasize that the issue presented by this motion focuses only on whether the CSRA forecloses a probationary employee from any Bivens relief, regardless of the circumstances. The government’s sweeping assertion that it does, might have been made with more hesitation or not made at all, if, for example, the INS had erroneously declared a probationary employee to be a murderer; had terminated the employee for that reason; and had so proclaimed to the world by postings in public places.

A probationary employee has limited and fragile protectable interests in his employment and the manner of its termination, as the courts have noted in a variety of contexts, see Piskadlo v. Veterans’ Administration, Merit Systems Protection Board, 668 F.2d 82, 84 (1st Cir.1982); Shaw v. United States, 622 F.2d 520, 527 (Ct.Cl.), cert. denied 449 U.S. 881, 101 S.Ct. 410, 66 L.Ed.2d 252 (1980); Borrell v. U.S. International Communications Agency, 682 F.2d 981 (D.C.Cir.1982); Bartholomew v. United States, 740 F.2d 526 (7th Cir.1984); and Perry v. Federal Bureau of Investigation, 769 F.2d 450 (7th Cir.1985). But that does not mean that any liberty and, possibly, property interests he may have are foreclosed by the CRSA. What those interests might be and whether plaintiff has properly claimed their violation we leave to another day.

For the reasons stated, the motion to dismiss is denied.

      . This court’s knowledge of the plaintiffs statutory action before the U.S. Court of Appeals for the Federal Circuit is limited to what the plaintiff describes in his brief. We are told that he brought his appeal before the Merit Board pursuant to 5 C.F.R. § 315.806, which confines Board review to allegations that he was discharged for "partisan political reasons or marital status,” or that the agency followed improper procedures in his discharge. It is unclear how, from these grounds, the Board could have reached the conclusion that plaintiffs termination was “unworthy of credence and pretextual.” This decision seems more consistent with 5 C.F.R. § 315.804, which has been held to give probationary employees the substantive right to have honest reasons for their removal made in good faith. See Shaw v. United States, 622 F.2d 520, 527 (Ct.Cl.), cert. denied 449 U.S. 881, 101 S.Ct. 231, 66 L.Ed.2d 105 (1980).
      Whatever the basis for the Board’s decision, and plaintiffs claims under the CSRA, the plaintiffs case here clearly involves rights based on the Constitution and is properly before this court.

      . Because the whole of defendants’ motion to dismiss goes to plaintiffs constitutional claims contained in count I of his complaint, the court will treat the motion as one to dismiss count I and not attempt to divine arguments that have yet to be made regarding counts II and III.

      . The CSRA also gives probationary employees the right to petition the Office of Special Counsel of the Merit System Protection Board to investigate and seek correction of prohibited personnel practices, 5 U.S.C. § 1206(a)(1), but the employee is not a party to this investigation and the CSRA gives them no right to appeal an OSC decision not to prosecute. As the court stated in Borrell v. United States International Communications Agency, 682 F.2d 981, 990 (D.C.Cir.1982):
      We would, furthermore, be hard pressed to deny jurisdiction over a constitutional claim when the only alternative statutory remedy allows no right of individual participation by the injured employee and permits no judicial review of the merits of the agency official's decision not to investigate or prosecute the employee’s claim.

      . The court also recognized the converse of this proposition: that the existence of statutory protections is “a special factor precluding recognition of a Bivens action,” 710 F.2d at 298 (emphasis added), which is exactly what the Supreme Court said in Bush.

      . Defendants cite Francisco v. Schmidt, 575 F.Supp. 1200 (E.D.Wisc.1983), where the court found that a Bivens action was not available to a probationary employee under the CSRA. The court reasoned that the Supreme,, Court in Bush found that the “fact that the case involved the relations between the Government and its employees was determined to be ... a special factor,” counseling hesitation. 575 F.Supp. at 1202. The court finds that this reasoning paints Bush with too broad a brush, and that the reasoning in Egger is much more persuasive, as well as being controlling in this circuit. If plaintiff should prevail in the Federal Circuit, the views expressed here respecting the impact of CSRA bn this action will, of course, have to be reconsidered.


author: FEIKENS, Chief Judge.

text:
    CHRYSLER CORPORATION, a Delaware corporation, Plaintiff, v. BUNNELL CHRYSLER DODGE, INC., a Florida corporation, Ralph Sherrill and James Lowe, jointly and severally, Defendants.
    No. 85-CV-73115-DT.
    United States District Court, E.D. Michigan, S.D.
    Oct. 23, 1985.

      Paul R. Eichbauer and William T. McLel-lan, Steven B. Hantler, Detroit, Mich., for plaintiff.
    Anthony A. Haisch, Buesser, Buesser, Blank, Lynch, Fryhoff & Graham, Detroit, Mich., for defendants.
   MEMORANDUM OPINION AND ORDER

FEIKENS, Chief Judge.

Plaintiff, Chrysler Corporation, sues defendants Bunnell Chrysler Dodge, Inc. and its two fifty-percent stockholders, Ralph Sherrill and James Lowe, for breach of contract, breach of guaranty contract, and conversion. Jurisdiction is based upon 28 U.S.C. § 1332, there being complete diversity of citizenship between plaintiff and defendants.

The matter before me is defendant James Lowe’s Motion to Dismiss, or in the alternative, Motion for Summary Judgment. Defendant has raised four arguments in support of his Motion. First, defendant argues that no contract of guaranty exists between Chrysler Corporation and himself. Chrysler, however, has submitted a copy of a signed guaranty contract which, at a minimum, raises an issue of fact as to the existence of a guaranty between Chrysler and defendant. Second, defendant argues that he could not commit the act of conversion because he was not involved in the day-to-day control of Bun-nell Chrysler-Dodge and, thus, had no control over the automobiles that were allegedly converted. Again, this is a factual issue that I cannot decide at this time. Defendant Lowe was one of two fifty-percent shareholders in the Bunnell Chrysler-Dodge corporation and the issue of his control over the subject automobiles is in dispute.

Defendant’s third argument is that the statute of limitations has expired on any act of conversion. In support of this argument defendant cites Continental Casual ty Co. v. Huron Valley National Bank, 85 Mich.App. 319, 271 N.W.2d 218 (1978). In Continental, the Court applies a three-year statute of limitations period to a conversion claim under the Uniform Commercial Code. The court in Continental reasoned that the three-year limitations period should apply in order to further the policy of consistent application of the Uniform Commercial Code from state to state.

Other Michigan cases decided before and after the Continental case have interpreted the Michigan statute of limitations, M.C.L.A. § 600.5805, as applying a six-year limitations period to conversion actions outside of a Uniform Commercial Code context. See Drapefair, Inc. v. Beitner, 89 Mich.App. 531, 280 N.W.2d 585 (1979); Miller v. Green, 37 Mich.App. 132, 194 N.W.2d 491 (1971). The case before me is not covered by the conversion provisions of the Uniform Commercial Code; thus, I hold that a six-year statute of limitations period is appropriate. Accordingly, I hold defendant’s argument that plaintiffs conversion claim is outside the appropriate limitations period to be unavailing.

Defendant’s final argument in support of his Motion is that this Court has no personal jurisdiction over him. It is undisputed that defendant entered into an Application for Sale Agreement with Chrysler Corporation. See Plaintiff’s exhibit 1. The application is made between defendants Lowe and Sherrill, and plaintiff Chrysler Corporation of Detroit, Michigan. In addition, defendant Lowe signed a Continuing Guaranty with Chrysler Corporation Credit Department of Detroit, Michigan. See Plaintiff’s exhibit 5. Chrysler has submitted an affidavit which states: “Since Bunnell’s participation in the Dealer Rent-A-Car Program would increase Chrysler’s risk, Chrysler required Lowe to submit a Continuing Guaranty of Bunnell’s obligation to Chrysler.” See Declaration of Sandra L. Laurence, 11 8. Thus, it appears that Chrysler Corporation relied upon the contracts which defendant Lowe had entered in its decision to allow Bunnell to join the Dealer Rent-A-Car Program.

It is these rental cars which Chrysler alleges were converted by Lowe. Under the recent teachings of the Supreme Court in Burger King Corp. v. Rudzewicz, — U.S. -, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985), it appears that personal jurisdiction over defendant Lowe in this case does not offend the Constitutional guaranty of due process:

And with respect to interstate contractual obligations, we have emphasized that parties who “reach out beyond one state and create continuing relationships and obligations with citizens of another state” are subject to regulation and sanctions in the other State for the consequences of their activities. Travelers Health Assn. v. Virginia, 339 U.S. 643, 647, 70 S.Ct. 927, 929, 94 L.Ed. 1154 (1950). See also McGee v. International Life Insurance Co., 355 U.S. 220, 222-223, 78 S.Ct. 199, 200-201, 2 L.Ed.2d 233 (1957).... Where a forum seeks to assert specific jurisdiction over an out-of-state defendant who has not consented to suit there, this “fair warning” requirement is satisfied if the defendant has “purposefully directed” his activities at residents of the forum, Keeton v. Hustler Magazine, Inc., 465 U.S. 770, -, 104 S.Ct. 1473, 1478, 79 L.Ed.2d 790 (1984), and the litigation results from alleged injuries that “arise out of or relate to” those activities, Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, -, 104 S.Ct. 1868, 1872, 80 L.Ed.2d 404 (1984).

105 S.Ct. at 2182 (footnotes omitted).

In this case, Lowe purposefully directed his activities at Chrysler Corporation of Detroit, Michigan, and in turn, Chrysler sent a number of Dealer Rent-A-Cars to Bunnell Chrysler-Dodge. Chrysler now alleges that defendant Lowe converted a number of these Dealer Rent-A-Cars. I hold that defendant Lowe’s continuing activity with residents of Michigan and the alleged conversion which arises out of or relates to this activity is sufficient to render Lowe subject to the personal jurisdiction of this Court.

Accordingly, defendant James Lowe’s Motion to Dismiss, or in the alternative, Motion for Summary Judgment is hereby DENIED.

IT IS SO ORDERED.


author: EARL E. O’CONNOR, Chief Judge.

text:
    Wilma KISTLER, Plaintiff, v. LIFE CARE CENTERS OF AMERICA, INC., Defendant.
    Civ. A. No. 84-2444.
    United States District Court, D. Kansas.
    Oct. 23, 1985.
    J. Nick Badgerow, McAnany, Van Cleave & Phillips, Kansas City, Kan., for plaintiff.
    A. McArthur Irvin, Clark, Paul, Hoover & Mallard, Atlanta, Ga., Steven E. Werm-crantz, Karen D. Wedel, Linde, Thomson, Fairchild, Langworthy, Kohn & Van Dyke, Kansas City, Mo., for defendant.
   MEMORANDUM AND ORDER

EARL E. O’CONNOR, Chief Judge.

Defendant, Life Care Centers of America, Inc., has moved for summary judgment as to plaintiff’s claim for retaliatory discharge and as to plaintiff’s claim for breach of an implied contract. Because material questions of fact exist with respect to both claims, we deny defendant’s motion.

On November 9, 1984, plaintiff filed a complaint in this court, alleging that defendant had terminated her employment because she had testified against defendant at a state unemployment compensation hearing in Kansas. Plaintiff asserts that her termination was in violation of an implied employment contract. Plaintiff also contends that, even if no implied employment contract'existed, defendant’s act of firing her for testifying violates the public policy of the state of Kansas and constitutes the tort of retaliatory discharge.

The legal standards to be applied to a summary judgment motion are quite clear. Summary judgment is appropriate when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). In considering such a motion, the court must examine all evidence in the light most favorable to the opposing party. Mogle v. Sevier County School District, 540 F.2d 478, 482 (10th Cir.1976), cert. denied, 429 U.S. 1121, 97 S.Ct. 1157, 51 L.Ed.2d 572 (1976). Where different inferences could reasonably be drawn from conflicting affidavits and depositions, summary judgment should be denied. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962).

I. Retaliatory Discharge.

Despite defendant’s assertion to the contrary, several issues of fact exist with respect to plaintiff's claim for retaliatory discharge. Defendant maintains that plaintiff was not terminated, but that she quit. As evidence that plaintiff did not herself believe that she had been fired, defendant contends that plaintiff did not even tell her own family that she had lost her job. Plaintiff, however, insists that Administrator Joyce Regnier terminated her, stating at least three times that “we think you should seek other employment, because you testified against your employer.” [Kistler Deposition 34:2-11; 36:12-16] Plaintiff also claims, despite defendant’s mysterious reading of her deposition to the contrary, that she told her family she had been terminated. Clearly, issues of fact and credibility exist that cannot be resolved by summary judgment.

Defendant’s second position is that even if these facts are disputed, they are not material facts because plaintiff, as an employee at will, could legally be terminated by defendant for testifying at the unemployment compensation hearing. We disagree with defendant’s interpretation of Kansas law.

Kansas follows the general rule that in the absence of a contract covering the duration of employment, the employment is terminable at the will of either party, and the employee states no cause of action by alleging that he has been discharged. Mildfelt v. Lair, 221 Kan. 557, 561 P.2d 805 (1977); Johnson v. National Beef Packing Co., 220 Kan. 52, 551 P.2d 779 (1976); Johnston v. Farmers Alliance Mutual Ins. Co., 218 Kan. 553, 554 P.2d 312 (1976). Kansas courts, however, recognize a public policy exception to this general rule.

In Murphy v. City of Topeka, 6 Kan.App.2d 488, 630 P.2d 186 (1981), the Kansas Court of Appeals held that an employee at will who was fired in retaliation for filing a workmen’s compensation claim had a cause of action for retaliatory discharge. The court noted:

We believe the public policy argument has merit. The Workmen’s Compensation Act provides efficient remedies and protection for employees, and is designed to promote the welfare of the people in this state. It is the exclusive remedy afforded the injured employee, regardless of the nature of the employer’s negligence. To allow an employer to coerce employees in the free exercise of their rights under the act would substantially subvert the purpose of the act.

Id. at 495-96, 630 P.2d at 192.

We realize that the public policy exception recognized by the Kansas courts is a limited one. It is not, however, confined strictly to cases involving the discharge of an employee who files a workmen’s compensation claim. In Wynn v. Boeing Military Airplane Co., 595 F.Supp. 727 (1984) (Theis, J.), this court held that the Kansas policy against racial discrimination, embodied in the Kansas Acts Against Discrimination, prohibits discharge of an employee at will on the basis of race. Moreover, the Tenth Circuit has affirmed the notion that the Kansas public policy exception to the general employment at will rule, though narrow, is broader than cases involving assertion of rights under the workmen’s compensation law. Viestenz v. Fleming Companies, Inc., 681 F.2d 699 (10th Cir.1982).

In addressing whether plaintiff, in this case, has alleged facts that fall within an exception to the general rule, we note that the state legislature has strongly expressed a policy against allowing employers to interfere with unemployment compensation hearings. Section 44-615 of the Kansas Statutes Annotated provides:

Unlawful acts against witnesses and litigants. It shall be unlawful for any person, firm or corporation to discharge any employee or to discriminate in any way against any employee because of the fact that any such employee may testify as a witness before the secretary of human resources, or shall sign any complaint or shall be in any way instrumental in bringing to the attention of the secretary of human resources any matter of controversy between employers and employees as provided herein.

We believe that this clear state policy constitutes an exception to the general rule that an employer can fire an at will employee for any reason. If anything, this state policy provides an even stronger basis for recognizing an exception than the policy embodied in the Workmen’s Compensation Act cited by the Kansas Court of Appeals in Murphy.

In Murphy, the court stressed that: “[t]o allow an employer to coerce employees in the free exercise of their rights under the [Workmen’s Compensation Act] would substantially subvert the purpose of the act.” 6 Kan.App.2d at 495-96, 630 P.2d at 192. That statement applies with at least equal force to the state policy of protecting the integrity of unemployment compensation hearings.

The state has determined that it is in the public interest to hold such hearings. The testimony of witnesses, including an employer’s workers, is so essential to the successful conduct of these hearings that the state has given the Secretary of Human Resources the power to compel the attendance of these witnesses. In promulgating K.S.A. 44-615, the legislature recognized that it makes little sense to compel witnesses to testify if they are not free to speak the truth. If an employer can, with impunity, fire an employee who testifies against the employer at an unemployment compensation hearing, few employees can be expected to sacrifice their livelihoods for the sake of telling the truth. Simply put, the Kansas Legislature has made it clear that employers cannot force employees to choose between their jobs and committing perjury at a state hearing. We conclude that an employer in Kansas cannot fire an at will employee for testifying at an unemployment compensation hearing and, therefore, that plaintiff has stated a valid cause of action for retaliatory discharge.

. II. Breach of an Implied Contract.

Plaintiff, in her second cause of action, asserts a claim for breach of an implied contract of employment. Because the ex-istenee of an implied contract is a question of fact for the jury, we deny defendant’s motion for summary judgment with respect to this claim.

As the Supreme Court of Kansas noted in Johnson v. National Beef Packing Co., 220 Kan. 52, 551 P.2d 779 (1976):

Where no definite term of employment is expressed, the duration of employment depends on the intention of the parties as determined by circumstances in each particular case. The understanding and intent of the parties is to be ascertained from the written or oral negotiations, the usages of business, the situation and object of the parties, the nature of the employment, and all the circumstances surrounding the transaction.

Id. at 54-55, 551 P.2d at 782. The intent of the parties is a question of fact for the jury. Allegri v. Providence-St. Margaret Health Center, 9 Kan.App.2d 659, 684 P.2d 1031 (1984); State v. Edwards, 209 Kan. 681, 498 P.2d 48 (1972).

In Allegri, the court of appeals reversed a summary judgment in favor of the defendant and noted several factors that could lead a jury to find an implied contract of employment. These factors, among others, included an employee handbook that provided a list of grounds for termination, the longevity of plaintiff’s employment with defendant, and an excellent performance evaluation plaintiff received from defendant. 9 Kan.App.2d at 661-62, 664, 684 P.2d at 1034, 1036.

In this case, plaintiff points to an “Employee Code of Conduct,” signed by plaintiff, which lists forty-three acts that “constitute cause for discharge.” Plaintiff also alleges that she always received favorable job evaluations and that defendant led her to believe that the job was permanent. We conclude that plaintiff has raised questions of material fact and that summary judgment is, therefore, inappropriate on plaintiff’s second claim.

IT IS THEREFORE ORDERED that defendant’s motion for summary judgment be denied with respect to both of plaintiff’s claims.

      . In fact, plaintiff alleges that she testified only after being served with a subpoena.