author: Judge STERNBERG.

text:
    The PEOPLE of the State of Colorado, Plaintiff-Appellee, v. Timothy R. STEAD, Defendant-Appellant.
    No. 00CA2212.
    Colorado Court of Appeals, Div. III.
    Aug. 15, 2002.

      Certiorari Denied March 24, 2003.

      Ken Salazar, Attorney General, Matthew S. Holman, Assistant Attorney General, Denver, Colorado, for Plaintiff-Appellee.
    David S. Kaplan, Colorado State Public Defender, Danielle Moore, Deputy State Public Defender, Denver, Colorado, for Defendant-Appellant.

       Justice RICE does not participate.

   Opinion by

Judge STERNBERG.

Defendant, Timothy R. Stead, appeals from the trial court's order classifying him as a sexually violent predator as defined by § 18-8-414.5, C.R.S8.2001, and thus subjecting him to lifetime registration as a sex offender and other requirements of § 18-3-412.5, C.R.S.2001. We affirm.

Defendant was charged with twenty-nine criminal counts arising from a series of incidents between March 1999 and February 2000. Defendant befriended teenagers and opened his home to them. He provided them with drugs and alcohol and encouraged or engaged them in sexual activity, often photographing them. These photographs and numerous other items of pornography were recovered from defendant's apartment.

Defendant pleaded guilty to one count each of sexual exploitation of a child, contributing to the delinquency of a minor, sexual assault on a child, second degree sexual assault, and second degree sexual assault on an at-risk adult. The trial court sentenced defendant to twelve years in the Department of Corrections (DOC) for sexual exploitation of a child, six years for contributing to the delinquency of a minor, two years to life for sexual assault on a child, four years to life for second degree sexual assault on an at-risk adult, and to two years in the county jail for second degree sexual assault. The trial court ordered that the first two sentences run consecutively to one another and concurrently with the remaining three sentences.

At the sentencing hearing, a contested issue was whether defendant met the criteria of a sexually violent predator as defined by § 18-8-414.5. After hearing evidence from a probation supervisor and three sex offender evaluators, the trial court adjudicated defendant a sexually violent predator. This appeal followed.

I.

Defendant contends that the sex offender registration and internet posting requirements of § 18-38-412.5 violate his constitutional rights to due process and trial by jury. Defendant argues that his adjudication as a sexually violent predator exposes him to an enhanced penalty; thus, in his view, under Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 485 (2000), this determination had to be made by a jury and proved beyond a reasonable doubt. We disagree.

Colorado's sex offender registration law was amended effective July 1, 2000. Under the amended statute, any person sentenced as a sexually violent predator has a lifetime duty to register with local law enforcement agencies in the jurisdiction in which he or she resides. _- Section 18-8-412.5(8.5)(a), C.R.S$.2001. Prior to this amendment, the registration statute permitted an offender, after a certain number of years, to petition the district court to discontinue the registration requirement. Colo. Sess. Laws 1994, ch. 290, § 18-8-412.5(7) at 1738.

In addition, on May 283, 2000, the General Assembly enacted legislation requiring the Colorado Bureau of Investigation to post a link on the State of Colorado Internet home page to a list containing the name, address, place of employment, physical description, and digitized photograph of any person required to register as a sexually violent predator. Section 18-8-412.5(8.6)(a), C.R.S8.2001. An offender must pay for the cost of the photograph and for a set of fingerprints to verify the offender's identity. Section 18-3-412.5(8)(e), C.R.S.2001.

In Apprendi v. New Jersey, supra, the Supreme Court determined that any fact, other than the fact of a prior conviction, that increases the maximum penalty for a crime beyond the prescribed statutory maximum for that crime must be submitted to the jury and proved beyond a reasonable doubt. See also People v. Martinez, 32 P.3d 520 (Colo.App.2001).

Because we conclude that the registration and Internet posting provisions of § 18-3-412.5 do not constitute punishment, Apprendi is inapplicable.

A. Lifetime Registration

Defendant argues that imposing on him a lifetime duty to register as a sex offender constitutes punishment. We reject the argument.

A division of this court has determined that the sex offender registration statute, § 18-8-412.5(1), C.R.S.2001, does not disadvantage those offenders subject to its provisions; thus, registration is not punishment subject to ex post facto analysis. Ja-maison v. People, 988 P.2d 177 (Colo.App. 1999). We adopt the same analysis here.

As noted by the division in Jamison, the intent of the General Assembly in enacting the sex offender registration provisions is not to inflict additional punishment, but rather to aid law enforcement officials in investigating future sex crimes and to protect the public safety. This purpose is expressly declared in the legislation:

The general assembly ... finds that the public must have limited access to information concerning persons convicted of offenses involving unlawful sexual behavior that is collected pursuant to this section to allow them to adequately protect themselves and their children from these persons. The general assembly declares, however, that, in making this information available on a limited basis to the public, it is not the general assembly's intent that the information be used to inflict retribution or additional punishment on any person convicted of an offense involving unlawful sexual behavior.

Section 18-8-412.5(6.5)(a), C.R.8.2001.

Moreover, requiring a person to register as a sex offender does not increase the time that person spends in custody. Jamison v. People, supra; see also People v. Montaine, 7 P.3d 1065 (Colo.App.1999).

Our analysis does not change even though persons categorized as sexually violent predators are no longer eligible, under the July 2000 amendment, to petition to be released from the registration requirements. Before this amendment, it was within the discretion of the trial court to release an offender from the duty to register. That the duty to register now lasts for life, as opposed to lasting indefinitely, does not transform it into a punishment.

B. Internet Posting

Defendant also argues that posting personal information about him on the internet, including his name, address, place of employment, physical description, and photograph, is a criminal penalty. We disagree.

Section 18-8-412.5(8.6)(a) provides that a link to a list of the personal information of certain sex offenders, including persons classified as sexually violent predators, reoffen-ders, and persons failing to register, will be posted on the state home page.

The trial court determines whether an offender is a sexually violent predator. Section 18-8-414.5(2), C.R.S.2001. A sexually violent predator is an offender: (1) who is eighteen years of age or older as of the date of the offense; (2) who has been convicted on or after July 1, 1999 of one of several enumerated offenses, including second degree sexual assault and sexual assault on a child; (8) whose victim was a stranger to the offender or a person with whom the offender established or promoted a relationship primarily for the purpose of sexual victimization; and(4) who, based on the results of a risk assessment screening instrument, is likely subsequently to commit another of the listed offenses. Section 18-3-414.5(1), C.R.S. 2001.

As discussed, the intent of the General Assembly in enacting this provision was to serve public safety needs and to aid law enforcement. Although a legislature's descriptive label on a statute is not always dispositive, a reviewing court should reject that label only where a party challenging the statute provides "the clearest proof" that the statutory scheme is so punitive either in purpose or effect as to negate the stated civil intention. Kansas v. Hendricks, 521 U.S. 346, 361, 117 S.Ct. 2072, 2082, 138 LEd.2d 501, 515 (1997).

Whether placement on the internet sex offender list constitutes punishment is an issue of first impression in Colorado. We find the analyses in Femedeer v. Haun, 227 F.3d 1244 (10th Cir.2000), and People v. Stead, 845 P.2d 1156 (Colo.1993), to be instructive.

Femedeer examined a Utah statute, Utah Code Ann. § 77-27-21.5(10) (1998), that created a sex offender internet notification scheme substantially the same as Colorado's program. The court applied the factors outlined in Kennedy v. Mendoza-Martinez, 372 U.S. 144, 88 S.Ct. 554, 9 L.Ed.2d 644 (1963), to determine whether posting personal information on the Internet about convicted sex offenders constituted additional criminal punishment in violation of the Ex Post Facto Clause.

The Mendoga-Martines factors include: (1) whether the sanction involves an affirmative disability or restraint; (2) whether it has historically been regarded as a punishment; (8) whether it comes into play only on a finding of scienter; (4) whether its operation will promote the traditional aims of punishment-retribution - and - deterrence; - (5) whether the behavior to which it applies is already a crime; (6) whether an alternative purpose to which it may rationally be connected is assignable for it; and (7) whether it appears excessive in relation to the alternative purpose assigned.

The court in Femedeer determined that the Utah legislature intended to establish a civil remedy, not a criminal penalty. It then looked to the punitive effect of the statute under the Mendozo-Martines factors and concluded that, overall, the dissemination of an offender's personal information over the internet did not serve as punishment.

In Stead, supro, the Colorado Supreme Court examined similar factors to determine whether a $1000 drug offender surcharge, used to cover the costs of substance abuse assessment, testing, education, and treatment, constituted an additional punishment. The court started its analysis with the definition of "punishment" as "any fine, penalty, or confinement inflicted upon a person by the authority of the law." People v. Stead, supra, 845 P.2d at 1160 (quoting Black's Law Dictionary 1234 (6th ed.1990)). The court noted that the surcharge was part of the Colorado eriminal code, that it was available as a sanction after a person had been conviect-ed of a drug-related offense, and that the amount of the fine corresponded to the degree of felony committed. In addition, because the money collected was used primarily to fund education and treatment programs for substance abusers, the surcharge directly served the purposes of prevention and rehabilitation.

We now examine the Colorado sex offender Internet notification scheme under the factors articulated in Mendoza-Martines and Stead.

' 1. Affirmative Disability or Restraint

Here, as with the Utah statute, the Internet notification program does not impose a disability or restraint. It does not by itself restrict where sex offenders may live and work. Further, it does not affect the length of a defendant's incarceration or parole eligibility. See Gasper v. Gunter, S51 P.2d 912 (Colo.1993).

2. Traditional Punishment

We agree with the Femedeer court that public dissemination of information about criminal history is not traditionally considered a punishment, despite the potential negative consequences for a defendant. Much of the information on the Internet was previously available to the public, albeit on a more limited basis, through the sex offender registry, as well as through public criminal ree-ords. We do not consider this factor to weigh heavily towards finding that the internet notification scheme is a punishment.

8. Finding of Scienter

The statute may meet the third element of the Mendoza-Martines test in that it does, in some cases, require an additional finding of scienter.

We look only to the face of the statute, not to the offenses underlying an individual's classification as a sexually violent predator. See Femedeer v. Haun, supra (citing Hudson v. United States, 522 U.S. 98, 118 S.Ct. 488, 139 L.Ed.2d 450 (1997)).

To classify an offender as a sexually violent predator, the trial court must find, among other things, that the victim was a stranger or "a person with whom the offender established or promoted a relationship primarily for the purpose of sexual viectimization." - Section 18-8-414.5(1)(a)(III), C.R.S. 2001. Thus, where the victim is not a stranger, the court must be satisfied that the offender had a specific intent in forming the relationship.

We note, however, that this finding applies only to persons categorized as sexually violent predators, not to others subject to the Internet notification provisions of the statute.

4. Traditional Aims of Punishment

The fourth Mendozga-Martines factor is whether the statute promotes the traditional aims of punishment, such as deterrence or retribution. We agree with the Femedeer court that while the internet posting might indirectly have a deterrent effect, this factor is inconclusive.

Further, while an offender subject to this statute must pay for the cost of a photograph and fingerprints, this expense is distinguishable from the drug offender surcharge in People v. Stead, supra, which the supreme court concluded was a punishment. Unlike that surcharge, the amount collected here has no correlation to the degree of felony committed, and it covers the administrative costs of a program intended primarily to provide information to law enforcement and the public, not to rehabilitate convicted offenders. See Wood v. Beatrice Foods Co., 813 P.2d 821 (Colo.App.1991)(law will withstand an ex post facto challenge if the legislative intent is not to impose further punishment for past crimes, but instead is to regulate a present situation).

5. Behavior Already a Crime

Unquestionably, the behavior triggering the sanction is itself a crime. The Internet posting requirements for sexually violent predators are part of the criminal code and are triggered upon conviction of specified sexual offenses. See § 18-3-414.5(1)(a)(II), C.R.8.2001.

This factor is met even though a separate proceeding is held to determine whether an offender is a sexually violent predator. An offender does not come within the ambit of § 18-3-412.5(8.6)(a) unless that person has been convicted of a crime involving unlawful sexual behavior.

6. Rational Connection to a "Good Purpose"

As discussed, the purpose of the registry is to aid in the prevention and investigation of future sex crimes. Posting information about specific sex offenders on the Internet is rationally connected to this purpose.

Further, we note that the statute here is more narrowly drawn than the Utah statute examined in Femedeer. The Utah notification scheme included all offenders who had been convicted of particular crimes. Section 18-8-412.5(8.6), C.R.8.2001, by contrast, essentially applies only to sex offenders who are evaluated to be at a high risk of reoffend-ing, those who have reoffended, or those who have failed to register. By limiting the Internet list to those subcategories of offenders, the General Assembly has attempted to tailor the purpose of the list to its actual effect.

7. Exeessive Costs

Finally, we conclude that the Internet notification scheme does not impose excessive costs in relation to the public safety purpose for which it is intended.

As noted by the court in Femedeer, although the personal information about these offenders will be widely available, persons seeking this information still have to act affirmatively to obtain it. In addition, "the farther removed one is from a sex offender's community ..., the less likely one will be to have an interest in accessing this particular registry." - Femedeer v. Haun, supra, 227 F.3d at 1253. Given the great harms inflict, ed by sex offenders, the dangers presented by the dissemination of this information are not excessive.

In sum, we find that the internet notification scheme may have the purpose or effect of a punishment in that it is triggered by a criminal offense, and it may require an additional finding of scienter. However, the scheme is not punitive in that it imposes no fine, confinement, or restraint; it has an expressly nonpunitive intent and purpose; it is not traditionally considered a type of punishment; and it is not excessive in relation to the public safety purposes it serves.

We conclude that, taken as a whole, the Internet posting provision of the sex offender statute does not constitute additional punishment. Thus, the trial court's adjudication of defendant as a sexually violent predator did not violate his constitutional rights under Apprendi to trial by jury and due process.

IL

Defendant's next contention is that the trial court abused its discretion by adopting in its findings the evidence of an uncertified sex offender evaluator and her supervisor. We disagree.

The trial court made detailed findings and determined that defendant met the four statutory criteria of a sexually violent predator under § 18-3-414.5. Defendant contests only the last criterion: whether the risk assessment screening instrument showed that he was likely to reoffend.

Two sex offender evaluators administered the risk assessment screening instrument on defendant; one was not certified and thus her work was supervised by another evaluator. According to the risk assessment instrument, an offender is considered likely to reoffend if he or she meets four of ten risk seale descriptors. The two evaluators here agreed that defendant met three of the descriptors.

The trial court agreed with the evaluators and found, further, that defendant met two additional descriptors: defendant was employed less than full time at the time of arrest and he scored high on a denial scale. Although the evaluators disagreed with each other as to whether defendant met the last two descriptors, we give deference to the trial court's findings of fact and will not overturn them if they are supported by competent evidence. See People v. Owens, 969 P.2d 704 (Colo.1999).

There was evidence that defendant had not worked thirty-five or more hours per week for one year at the time of his arrest, the definition of "full-time" employment in the risk assessment instrument. The trial court properly used this definition in its findings.

Further, there was evidence that defendant continued to exhibit a high level of denial. According to the testimony of one evaluator, defendant maintained that his vie-tims "enjoyed it," that they had initiated the sexual contact, and that he did not view himself as a sex offender.

This evidence supports the trial court's findings that defendant met the criteria of a sexually violent predator. Therefore, we perceive no abuse of discretion.

III.

Defendant also contends that the trial court's determination that he is a sexually violent predator subjects him to ex post facto punishment in violation of the United States and Colorado Constitutions. Because defendant did not raise this contention at any time in the trial court, it arguably is not properly before us, but, in any event, the issue is resolved adversely to defendant by Jamison v. People, supra.

Order affirmed.

Judge JONES and Judge DAVIDSON concur.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S.2001.


source: Caselaw Access Project

author: Judge CASEBOLT. Judge WEBB Judge WEBB

license: Public Domain

text:
    Larry N. WISEHART, Plaintiff-Appellant, v. Michael MEGANCK and Vectra Bank Colorado, NA, Defendants-Appellees.
    No. 01CA1327.
    Colorado Court of Appeals, Div. I.
    Aug. 15, 2002.
    Rehearing Denied Oct. 10, 2002.

    Certiorari Denied March 24, 2003.

      William C. Danks, Denver, Colorado, for Plaintiff-Appellant.
    McNamara Law Firm, P.C., John N. McNamara, Jr., Griffith A. Kundahl, Denver, Colorado, for Defendants-Appellees.

       WEBB, J., would Grant.

       Justice RICE does not participate; Cheif Justice MULLARKEY and Justice BENDER would grant as the following issue:
      Whether the court of appeals erred when it af firmed the trial court's summary judgment order rejecting the plaintiff's fraud claim.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S.2001.

   Opinion by

Judge CASEBOLT.

In this civil case arising from termination of an employment relationship, plaintiff, Larry N. Wisehart, appeals the summary judgment in favor of defendants, Vectra Bank Colorado, NA and Michael Meganek, dismissing his claims for fraudulent misrepresentation and concealment. We affirm.

Plaintiff worked for the bank as a loan officer in an at-will relationship. Bank policy required him to obtain the approval of other bank officers when processing certain loans. While the bank's loan policy required written approval of the officers to be obtained before any closing, in practice the approvals were sometimes obtained afterwards.

On the day before the scheduled closing of a particular loan, plaintiff met with a senior loan officer to obtain his approval. That officer told plaintiff that he needed more detailed information regarding the loan and requested plaintiff to provide it. When plaintiff returned with the requested information later that afternoon, the officer had departed and could not be located.

Following the meeting with plaintiff, and without receiving the requested information, the officer informed another bank employee that he was not going to approve the loan. Nevertheless, in fact, neither the officer nor the bank had any objection to the loan.

Plaintiff's superiors knew the loan closing date well in advance and specifically were aware on the date of the closing that plaintiff intended to proceed with it. Despite opportunities to do so, no one informed plaintiff that the bank officer did not intend to give his approval.

While plaintiff was attending the closing the next day' in another city, the bank issued his final paycheck in anticipation of termination. When plaintiff returned to the bank, Meganck, one of his supervisors, informed him that he was being terminated for failing to obtain the required written approvals before closing.

Plaintiff then initiated this action asserting claims for fraudulent misrepresentation and concealment against the bank and Meganck, essentially alleging that defendants had fraudulently set him up to be terminated. Plaintiff further alleged that the bank's stated reason for termination masked a plan to replace employees like himself who had been long-term employees of another financial institution that had merged with the bank.

Contending that Colorado does not recognize a claim of fraud in the employment at will context, defendants filed a motion for summary judgment. The trial court held, inter alia, that plaintiff's claims, even though couched in terms of fraud, essentially asserted a claim for wrongful termination, and the fact that his termination was achieved through fraud did not change the true nature of the claims. The court concluded that, even though defendants may have created a reason to terminate plaintiff's employment, that action did not give rise to a claim because defendants were free to terminate him without any reason whatsoever. Hence, the court dismissed plaintiff's claims, and this appeal followed. i

I.

Plaintiff contends the trial court incorrectly held that he could not pursue his fraud claims because he was an at-will employee. He asserts that employers should be subject to ordinary fraud rules that apply generally in all settings. Defendants assert the trial court correctly held that allowing a fraud claim under these cireumstances would improperly undermine the employment at will doctrine. We agree with defendants.

We review summary judgments de novo. Aspen Wilderness Workshop, Inc. v. Colorado Water Conservation Board, 901 P.2d 1251 (Colo.1995); Mohr v. Kelley, 8 P.3d 548 (Colo.App.2000).

A reviewing court applies the same standards as the trial court in determining whether summary judgment is warranted. Smith v. Boyett, 908 P.2d 508 (Colo.1995). Summary judgment is appropriate only if the pleadings and supporting documents demonstrate that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Aspen Wilderness Workshop, Inc. v. Colorado Water Conservation Board, supra. The nonmoving party is also entitled to the benefit of all favorable inferences that may reasonably be drawn from the undisputed facts. City of Aspen v. Marshall, 912 P.2d 56 (Colo.1996).

A.

In Colorado, an agreement of employment that is for an indefinite term is presumed to be at will. Either the employer or the employee may terminate at-will employment at any time with or without cause, and such termination generally does not give rise to a claim for relief. Martin Marietta Corp. v. Lorenz, 823 P.2d 100 (Colo.1992); Continental Air Lines, Inc. v. Keenan, 731 P.2d 708 (Colo.1987).

The at-will nature of the employment relationship reflects a matter of public policy. Crawford Rehabilitation Services v. Weissman, 938 P.2d 540 (Colo.1997). The at-will employment doctrine promotes flexibility and discretion for employees to seek the best position to suit their talents and for employers to seek the best employees to suit their needs. By removing encumbrances to quitting a job or firing an employee, the at-will doctrine promotes a free market in employment analogous to the free market in goods and services generally. See Mackenzie v. Miller Brewing Co., 241 Wis.2d 700, 623 N.W.2d 739 (2001).

At the same time, strict application of the at-will doctrine may invite abuse and lead to injustice. Accordingly, legislation and the common law have restricted application of the at-will doctrine to balance the interests of employers and employees. See Martin Marifetta Corp. v. Lorenz, supra. For example, certain federal and state statutes have created private claims for relief for wrongful discharge based on discrimination with respect to race, color, gender, national origin, ances-tey, religious affiliation, disability, and age. State statutes also permit such claims in cases of termination resulting from an employee engaging in lawful activity off premises during nonworking hours, responding to a jury summons, and certain activities of "whistleblowing." See Crawford Rehabilitation Services v. Weissman, supra.

Colorado also recognizes a claim for relief for wrongful discharge in violation of public policy. This judicially crafted exception restricts an employer's right to terminate when the termination contravenes accepted and substantial public policies as embodied by legislative declarations, professional codes of ethics, or other sources. Rocky Mountain Hospital & Medical Service v- . - Mariani, 916 - P.2d - 519 (Colo.1996)(approving wrongful discharge claim based on accountant's refusal to violate code of professional conduct); see also Martin Marietta Corp. v. Lorens, supra (proscribing termination for refusing to engage in illegal conduct); Johnson v. Jefferson County Board of Health, 662 P.2d 463 (Colo.1983)(government employer may not terminate at-will employee for exercising right of free speech); Jones v. Stevinson's Golden Ford, 36 P.3d 129 (Colo.App.2001)(approving - wrongful - discharge claim based on employee's refusal to violate Consumer Protection Act and Motor Vehicle Repair Act); Lathrop v. Entenmann's, Inc., 770 P.2d 1367 (Colo.App.1989)(employer's retaliatory termination against employee for exercising right to apply for and receive workers' compensation benefits provided grounds for wrongful discharge claim).

These exceptions address societal concerns, while honoring the general rule that employment affects private interests, and therefore parties generally are free to bargain for conditions of employment. See Crawford Rehabilitation Services v. Weiss-man, supra (claims that relate to a private contract or promise between an employer and an employee do not raise public policy concerns, other than the general interest society has in the integrity of the employment relationship).

Operating from the premise that parties are free to require ecause for termination, Colorado also recognizes that an employer's failure to follow termination procedures contained in an employment manual can serve as the basis for a breach of contract or promissory estoppel claim. Continental Air Lines, Inc. v. Keenan, supra; see also Schoff v. Combined Insurance Co., 604 N.W.2d 43 (Iowa 1999); Mackenzie v. Miller Brewing Co., supra.

In addition, Colorado recognizes the viability of certain other tort claims that arise around the employment relationship. See Jet Courier Service, Inc. v. Mulei, 771 P.2d 486 (Colo.1989)(employee owes duty of loyalty to employer that prohibits soliciting employer's customers before terminating employment); Berger v. Security Pacific Information Systems, Inc., 795 P.2d 18380 (Colo.App.1990)(employee induced to enter into at-will employment by employer's concealment may pursue fraud claim); Cronk v. Intermountain Rural Electric Ass'n, 765 P.2d 619 (Colo.App.1988)(tortious interference claim allowed against supervisor who induced employer to exercise its at-will termination power by presenting corrupt reason).

To summarize, employers operating under at-will employment principles are generally free to discharge employees for any reason, even if that reason is wrong or incorrect, as long as the reason asserted does not trigger a recognized exception to the at-will termination doctrine noted above. Employees in such a relationship likewise may leave employment for any reason and at any time. Moreover, the presumption of at-will employment places the burden on the plaintiff to plead and prove circumstances that would authorize application of one of the recognized exceptions to the doctrine. See Schur v. Storage Technology Corp., 878 P.2d 51 (Colo.App.1994).

Here, plaintiff's claims arise out of the termination of his at-will employment relationship under which his employer was free to terminate him any time, with or without any reason. Plaintiffs claims do not fall within any of the recognized exceptions to the doctrine of at-will employment, nor do they allege allowable theories or tort claims surrounding the employment relationship.

Moreover, plaintiff does not assert that the parties agreed to vary the at-will relationship to require cause for termination. Courts in other states have recognized claims for fraudulent misrepresentation resulting in termination when there is evidence of such an agreement in part because the presumption of at-will employment is rebuttable by evidence of a contrary agreement between the parties. Sea-Land Service, Inc. v. O'Neal, 224 Va. 848, 297 S.E.2d 647 (1982); accord Pickell v. Arizona Components Co., 981 P.2d 1184 (Colo.1997)(presumption of at-will employment is rebuttable).

Here, in contrast, plaintiff specifically disavowed any contract or estoppel claim for relief, and he does not assert any agreement varying the at-will employment relationship. Further, he did not plead a claim of wrongful discharge in violation of public policy.

Accordingly, unless there is another basis to allow a fraud claim under these cireum-stances, plaintiff's claims fail.

B.

Plaintiff asserts that he is entitled to pursue claims that his termination resulted from fraudulent misrepresentation and concealment. He contends that an employer may not assert its right to terminate at will as a defense to a fraud claim. Plaintiff essentially asks us to recognize an exception to the at-will doctrine where the employer commits fraud to justify termination of an at-will employee. We decline to do so.

This is a question of first impression in Colorado. Most other courts that have considered such claims have concluded that the at-will doctrine precludes a claim for relief when fraud is the means used to effect termination. See Salter v. Alfa Insurance Co., 561 So.2d 1050 (Ala.1990); Hunter v. Up-Right, Inc., 6 Cal.4th 1174, 26 Cal.Rptr.2d 8, 864 P.2d 88 (1993); Tatge v. Chambers & Owen, Inc., 219 Wis.2d 99, 579 N.W.2d 217 (1998); see also Mackenzie v. Miller Brewing Co., supra (Tatge holding equally applicable to intentional and negligent misrepresentation claims). But of Mueller v. Union Pacific R.R., 220 Neb. 742, 371 N.W.2d 732 (1985).

Salter v. Alfa Insurance Co., supra, involved claims factually and legally similar to plaintiff's claims. In Salter, an insurance company instructed its agent not to investigate a particular claim. The agent complied with that instruction, but was subsequently terminated because she had failed to follow company policy requiring agents to cooperate with claims investigation. The court, noting that it did not sanction the insurance company's conduct, nevertheless recognized that the at-will doctrine permits termination for any reason, which necessarily includes grounds that are malicious or otherwise improper. The court therefore concluded that the agent's fraud claim failed as a matter of law. In its holding, the court recognized that the law will not punish a party for doing by misdirection that which it has a right to do forthrightly. Salter v. Alfa Insurance Co., supra; see also Hunter v. Up-Right, Inc., supra.

Here, while we likewise do not condone the bank's conduct, we find no basis to depart from the general rule that either party to an at-will employment contract may terminate the relationship for any reason, even if wrong, without giving rise to liability. See Martin Marietta Corp. v. Lorenz, supra; Continental Air Lines, Inc. v. Keenan, supra. Unless the plaintiff pleads and proves a recognized exception to the at-will employment doctrine, see Schur v. Storage Technology Corp., supra, the doctrine restrains courts from inquiring into the basis for termination and advances the value of a free market in employment for which the parties bargained.

We therefore decline to recognize an exception to the at-will employment doctrine for claims in which a fraud is employed to justify the termination of an at-will employment relationship. Plaintiffs' claims against the bank and Meganck therefore fail as a matter of law. See Mackenzie v. Miller Brewing Co., supra (at-will employment doe-trine precludes recognition of fraud claims against both employer and supervisor).

The parties do not raise, and we therefore do not address, the effect, if any, of 12 U.S.C. § 24 (Fifth) (2001) on the state law claims asserted here.

IL.

Plaintiff nevertheless contends that the bank, in its role as an employer, entered into a confidential relationship with him that gave rise to a duty to communicate honestly and openly regarding termination. We disagree.

The existence of a special relationship between contracting parties may trigger a tort duty of care in addition to duties arising from the contract. See Town of Alma v. Azco Construction, Inc., 10 P.3d 1256 (Colo.2000)(recognizing special relationship giving rise to tort duty of care between attorney and client, physician and patient, and insurer and insured).

However, a special relationship that would give rise to a tort duty of honesty and disclosure is not recognized in the usual employment relationship. See Decker v. Browning-Ferris - Industries, 931 P.2d 486 (Colo.1997)(rejecting analogy of employer-employee relationship to that of insurer-insured); see also Foley v. Interactive Data Corp., 47 Cal.3d 654, 254 Cal.Rptr. 211, 765 P.2d 373 (1988). But cf. Jet Courier Service, Inc. v. Mulei, supra.

Here, the record does not suggest any departure from the usual employment relationship or any basis for a confidential relationship during plaintiffs tenure with the bank. Accordingly, we conclude the bank did not owe plaintiff a tort duty of honesty and disclosure relating to his at-will termination.

IIL.

Plaintiff contends that, because the bank ostensibly terminated him for violating bank policy, and the bank has consistently maintained that his termination was for cause, we should review whether that cause was just. Essentially, he asks us to conclude that, although the bank had the right to terminate him with or without cause and for any reason, the fact that it claimed to have terminated him with cause and for a specific reason transformed the employment relationship from at will to one in which he could only be terminated for good cause. We reject this contention.

Any claim for relief arising because the bank terminated plaintiff's employment without cause or a valid reason requires as a predicate an agreement between the parties that cause or a valid reason is necessary for termination. Such a claim would also necessarily sound in contract. See Continental Air Lines, Inc. v. Keenan, supra (employment policy termination procedures imply existence of agreement to vary at-will relationship). To permit plaintiff to inquire into the cause for his termination in the guise of a tort claim would undo the parties' essential contractual bargain that there need be no such cause. See Town of Alma v. Azco Construction, Inc., supra (tort action is not permitted to enforce contractual obligations); Mackenzie v. Miller Brewing Co., supra (rejecting fraud claim in context of at-will employment on basis that it would envelop contract law with tort law).

At-will employment confers upon employer and employee the right to terminate with cause or without cause. The fact that the party that terminates the relationship claims that it had a good reason for doing so does not alter the nature of the relationship, nor does it give rise to a claim for relief.

IV.

Plaintiff contends that Berger v. Security Pacific Information Systems, supra, compels a different result. We disagree.

In Berger, a division of this court recognized a claim for fraudulent inducement against a former employer that had misrepresented its financial condition and business prospects to lure the plaintiff to accept an employment offer. The employer later terminated the plaintiff's employment. As the Berger division noted when the defendant asserted the right to terminate at will, a fraudulent inducement claim does not implicate the at-will employment doctrine. In such an instance, the fraud is not related to the at-will termination right. Rather, the fraud arises prior to employment, before the at-will relationship is formed. See Bernoudy v. Dura-Bond Concrete Restoration, 828 F.2d 1816 (8th Cir.1987).

Other courts permit claims of fraudulent inducement in the at-will employment context while forbidding claims of fraud used to effect an at-will termination. See Kidder v. AmSouth Bank, 639 So.2d 1361 (Ala.1994); Lazar v. Superior Court, 12 Cal.4th 631, 49 Cal.Rptr.2d 377, 909 P.2d 981 (1996); see also Mackenzie v. Miller Brewing Co., supra (dicta approving fraudulent inducement claim).

Accordingly, we reject this contention.

v.

To the extent plaintiff contends that his claims do not relate to his termination, but merely seek to hold his employer liable for acts of fraud that are generally actionable, we disagree.

Plaintiff describes defendants' fraudulent statements and acts as having been taken to set him up for termination. Plaintiff further asserts that he would not have acted as he did in reliance on defendants' fraud if he had known it would lead to his termination. See Hunter v. Up-Right, Inc., supra (plaintiff claiming fraud as means to effect termination fails to allege detrimental reliance as a matter of law). Likewise, all plaintiff's claimed damages arise directly from termination. See Salter v. Alfa Insurance Co., supro (plaintiff suffers no injury as a matter of law from misrepresentation resulting in termination).

Here, plaintiff's claims definitely relate to the termination of his employment. The employer used deception to justify a termination that it was entitled to carry out without explanation or reason. Limiting our decision to these cireumstances, we conclude that plaintiff may not challenge his at-will termination by asserting a fraud claim.

In light of our disposition, we need not address plaintiff's remaining contentions.

The judgment is affirmed.

Judge STERNBERG concurs.

Judge WEBB

dissents.

Judge WEBB

dissenting.

With respect, I dissent from the holding that plaintiffs nondisclosure claim depends on a "fraud exception" to the at-will employment rule. This is not a case of an employer that passively waited until it had cause to terminate an at-will employee, whether needed or not, but instead the bank allegedly resorted to fraud by nondisclosure. I find adequate support in Colorado tort law for applying basic fraud principles to plaintiff's employment relationship, despite his at-will status.

In Berger v. Security Pacific Information Systems, Inc., 795 P.2d 1380 (Colo.App.1990), a division of this court upheld the fraud claim of an employee who relied on the employer's concealment of a fact that cast doubt on the longevity of their at-will relationship, without purporting to create an exception to the at-will employment rule. Both the claim in Berger and plaintiff's claim here share the fact that the employees suffered injury from the fraud when the employers terminated them for tainted reasons, rather than merely exercising their right to terminate without reason.

I disagree with the majority's limitation of Berger to fraud "not employed to effect termination." The fraud claim there arose because the employer terminated the employee for the reason that it had allegedly concealed. Berger v. Security Pacific Information Systems, Inc., supra, 795 P.2d at 1885 ("[The employee] did not know, when she accepted the job with SPIS, that there was a substantial risk that SPIS would discontinue [her project] in the near future.").

In my view, Colorado's recognition of a claim for tortious interference with an at-will employment contract, see e.g., Cronk v. Intermountain Rural Electric Ass'n, 765 P.2d 619 (Colo.App.1988), also supports plaintiffs claim here. Tortious interference involves third party misconduct. Nevertheless, I discern no reason to recognize a claim against the supervisor in Cronk, who induced the employer to exercise its at-will termination power by presenting a corrupt reason concerning subordinates whom he had targeted, but here reject plaintiff's claim against the bank, which allegedly targeted plaintiff by contriving a reason for terminating him.

While the majority points to the general public policy underpinnings of the at-will rule, I do not see plaintiff as "inquiring into the basis for termination," which the majority correctly notes is prohibited by the at-will employment rule. Rather, plaintiff's allegations focus on the alleged cause and effect relationship between the timing of the bank's termination decision and its purported fraud. Thus, here as in many employment disputes, "timing is everything." NLRB v. Joy Recovery Technology Corp., 184 F.3d 1307, 1314 (7th Cir.1998).

Moreover, I am persuaded by the specific public policy of protecting employees against fraud by employers. See § 8-2-104, C.R.S. 2001 (remedy for employees fraudulently induced to come to Colorado for work). Hence, I would allow plaintiff an opportunity to prove that, as in any fraud case, he was put in a worse position for having relied on the bank's alleged fraudulent concealment. See generally 37 C.J.S. Fraud § 41 (1948).

The background facts are undisputed: the bank acquired plaintiff's prior employer in 1998, retained him as its at-will employee, and acknowledged that he was an exemplary employee until it terminated him in 1999 for having violated credit policy. The termination memorandum read, in relevant part:

The loan has not been approved internally according to Vectra Bank Colorado credit policy, yet you have willfully disregarded this fundamental rule and completed the transaction. You leave me no alternative but to terminate your employment at Vee-tra Bank for cause effective this date .... (emphasis supplied)

The unrefuted complaint allegations and differing reasonable inferences from undisputed facts show a viable fraudulent nondisclosure claim because: (1) the bank wanted to replace officers of the predecessor with its own people; (2) the bank took no action against plaintiff for approximately one year following the acquisition; (8) as a matter of past practice, the three signatures required by the credit policy were sometimes obtained after a loan closed; (4) the afternoon before the scheduled loan closing, the senior officer told another employee that he did not intend to sign the approval form on the loan at issue, but neither communicated this information to plaintiff nor directed anyone else to do so; (5) the senior officer's statement to plaintiff at about the same time that he wanted more information on the loan created a false impression that he had not yet decided against signing the loan approval form; (6) the senior officer intended plaintiff to close the loan the following morning in ignorance of the officer's decision not to sign; (7) given the past practice, plaintiff closed the loan in reasonable reliance on this false impression; (8) ultimately, the bank did not object to the loan; and (9) but for plaintiff's having thereby violated credit policy, the bank would not have terminated his employment at that time.

The only element of plaintiff's fraud claim disputed by the majority is detrimental reliance. However, the bank's alleged plan to replace at-will employees inherited from the predecessor with its own people could have been implemented at any time since the acquisition. Yet the bank acted only after- and then immediately after-according to plaintiff it had fraudulently orchestrated cause.

The inference that but for this contrived cause the bank would not have acted against plaintiff when it did, even though it did not need cause at all, finds support in factors beyond the bank's alleged machinations.

First, termination without cause would have left the bank at risk of litigation because of the many and somewhat unpredietable exceptions to the at-will employment rule.

Defense attorneys should not cause or allow their clients to believe in the vitality of the employment at-will doctrine. The doctrine is so riddled with exceptions that it will rarely be the case that the termination of a particular employee does not fall within one of the exceptions. In short, if an employer terminates an employee, prudence dictates that the employer have a good reason for the termination, which should be documented.

Practitioner's Guide to Colorado Employment Law 2-2 (Supp.2001)(emphasis supplied).

Second, absent clear cause for termination the bank could have been exposed to a claim by plaintiff under state and federal statutes protecting even at-will employees against age discrimination, because of the implication of age bias arising from plaintiff's status as a long-term and otherwise exemplary employee who was within the protected age group.

The narrow ground on which I would sustain plaintiff's claim-that the bank obtained through fraudulent nondisclosure a basis for termination without which it would not have terminated his employment when it did-does not contravene "the value of a free market in employment," as the majority fears. Fraud has long been recognized as an exception to caveat emptor. See, e.g., Mastin v. Bartholomew, 41 Colo. 328, 92 P. 682 (1907).

Even if employment at will is treated as a defense under basic tort principles, a jury question exists whether the bank's alleged contrivance of a reason for termination through fraudulent nondisclosure precludes a defense based on the at-will employment rule. Cf. First Interstate Bank v. Piper Aircraft Corp., 744 P.2d 1197 (Colo.1987)(fraudulent concealment of 2 wrongful act tolls the limitations period). See generally F. Harper et al., The Law of Torts 495 (2d ed. 1986)("Misrepresentation may also avoid a defense.").

That the bank could have terminated plaintiff's at-will employment the very next day or any time thereafter, for some other reason or even for no reason, raises a dilemma equally inherent in many Colorado cases that recognize public policy wrongful termination claims by at-will employees. This factor may limit plaintiff's damages, but should not extinguish his claim. See Berger v. Security Pacific Info. Sys., Inc., supra, 795 P.2d at 1385 (rejecting the argument that fraud damages should be limited because the employee had "no guarantee of continued employment," because the jury "could reasonably infer from the evidence that [the employee's] employment would have continued for a reasonable time").

Lazar v. Superior Court, 12 Cal.4th 681, 49 Cal.Rptr.2d 377, 909 P.2d 981 (1996), cited by the majority, also illustrates the importance of looking at whether the bank would have terminated plaintiff without the allegedly tainted reason. There, explaining why it had earlier rejected an employee's fraud claim in Hunter v. Up-Right, Inc., 6 Cal.4th 1174, 26 Cal.Rptr.2d 8, 864 P.2d 88 (1993), the court said, "[Blecause [the employer] had both the power and intention of discharging him in any event, [the employee] was no worse off for being induced by [the employer's] misrepresentation to resign." Lazar v. Superior Court, supra, 12 Cal.4th at 642, 49 Cal.Rptr.2d 377, 909 P.2d at 987 (emphasis supplied).

The majority correctly concludes that most courts hold the at-will doctrine precludes a claim when "fraud is the means used to effect the termination." However, the other cases on which the majority relies do not discuss the three factors whose convergence I see as precluding summary judgment here: (1) an ulterior motive for terminating the at-will employee; (2) followed by a significant delay until the employer fraudulently fabricated a reason for termination; and (8) termination soon thereafter on the basis of that tainted reason. See Salter v. Alfa Insurance Co., 561 So.2d 1050 (Ala.1990); Mackenzie v. Miller Brewing Co., 241 Wis.2d 700, 623 N.W.2d 789 (2001); Tatge v. Chambers & Owen, Inc., 219 Wis.2d 99, 579 N.W.2d 217 (1998).

Finally, I do not share the majority's concern that accepting plaintiff's fraud theory here would unduly conflate contract claims and tort claims. See Town of Alma v. Azco Construction, Inc., 10 - P.3d 1256 (Colo.2000)(Iimiting negligence claims where the parties have a contractual relationship, but citing with approval Brody v. Bock, 897 P.2d 769, 776 (Colo.1995), which held, "The fact that such alleged representations constitute the substance of Bock's breach of contract claim does not require dismissal of his [fraud] claim.").

Accordingly, I would reverse the summary judgment order and allow the jury to consider plaintiffs fraud claim based on why the bank terminated him when it did, rather than foreclosing that inquiry because of what the bank legally could have done much earlier, but did not do.


author: Judge DAILEY.

text:
    W.O. BRISBEN COMPANIES, INC., Plaintiff-Appellee and Cross-Appellant, v. Eric KRYSTKOWIAK, Defendant-Appellant and Cross-Appellee.
    No. 00CA2007.
    Colorado Court of Appeals, Div. III.
    Aug. 29, 2002.
    Certiorari Granted April 14, 2003.

      Deutsch, Spillane, Reutzel & Foster, P.C., John M. Spillane, Denver; Hall & Evans, L.L.C,, Alan Epstein, Denver, for Plaintiff-Appellee and Cross-Appellant.
    Anderson, Dude & Lebel, P.C., Lawrence A. Hecox, Lenard Rioth, Colorado Springs, for Defendant-Appellant and Cross-Appel-lee.
    Kelly, Haglund, Garnsey & Kahn, LL.GC,, Lori Potter, Denver, for Amicus Curiae SLAPP Resource Center.
   Opinion by

Judge DAILEY.

In this tort action for intentional interference with a contract, defendant, Eric Kryst-kowiak, appeals from a judgment granting his motion to dismiss, but denying his request for attorney fees and costs. Plaintiff, W.O. Brisben Companies, Inc. (Brisben), cross-appeals the judgment dismissing the action. We affirm in part, reverse in part, and remand.

Brisben proposed to build an apartment complex on vacant land located directly across the street from Krystkowiak's house.

Krystkowiak and his neighbors organized the Northeast Colorado Springs Neighborhood Association (NECSNA) to oppose Bris-ben's project. Krystkowiak, an unpaid volunteer, was NECSNA's Design Committee Chair and Spokesperson.

NECSNA alleged that Brisben's project violated City of Colorado Springs zoning and planning ordinances. The city planning commission coordinated a mediation session between NECSNA, Brisben, and city staff.

Krystkowiak attended the lengthy mediation session on NECSNA's behalf. While it is disputed whether the mediation resulted in an agreement between the parties, it is not disputed that at some point, NECSNA's president signed a draft settlement agreement. Krystkowiak did not, however, sign the agreement, even though a separate line for his signature was provided.

Under the terms of the alleged agreement, Brisben was to make certain modifications to its proposed project, and NECSNA was to discontinue its opposition to the project. However, Krystkowiak continued to appear before the city council on behalf of NECSNA in opposition to Brisben's project. Ultimately, the city rejected Brisben's proposed project because it did not comply with city code.

Thereafter, Brisben filed the present suit against both NECSNA and Krystkowiak for $16 million in damages. In its complaint, Brisben alleged that Krystkowiak's continued opposition to the project, after NECSNA contracted to discontinue its opposition, constituted a breach of contract by NECSNA and intentional interference with the contract by Krystkowiak.

Claiming immunity from liability under the First Amendment to the United States Constitution and the Volunteer Service Act, § 18-21-115.5, C.R.8.2001, Krystkowiak filed a C.R.C.P. 12(b) motion to dismiss for lack of subject matter jurisdiction.

In resolving Krystkowiak's motion, the trial court utilized the analysis set forth in Protect Our Mountain Environment, Inc. v. District Court, 677 P.2d 1861, 1868-69 (Colo. 1984)(POME ), whereby, "when confronted with a motion to dismiss predicated on the First Amendment right to petition the government," the motion is treated as one for summary judgment and resolved after giving the parties the opportunity to develop evidence material to specific First Amendment standards.

Here, after receiving and considering affidavits, depositions, and other evidence from the parties, the trial court granted Krystkow-iak's motion to dismiss based on POME. The court denied Krystkowiak's request for attorney fees and costs under § 18-17-201, C.R.S. 2001, however, because POME requires that a motion to dismiss be treated as a motion for summary judgment. The court certified its decision for appellate review under C.R.C.P. 54(b).

I.

Brisben contends that POME is inapposite to its intentional interference claim against Krystkowiak because the claim stems solely from a contractual dispute. We agree.

In POME, supra, 677 P.2d at 1368, the supreme court recognized that "suits filed against citizens for prior administrative or judicial activities can have a significant chilling effect" on exercise of the First Amendment right to petition the government.

Nonetheless, the right to petition the government is not without limits; parties may, consistent with the First Amendment, contractually obligate themselves not to exercise their right to comment on matters of public concern. Cohen v. Cowles Media Co., 501 U.S. 663, 669, 111 S.Ct. 2518, 2518, 115 L.Ed.2d 586, 597 (1991); see Pierce v. St. Vrain Valley School District RE 1J, 981 P.2d 600, 604 (Colo.1999)(parties imposed their own restrictions on their ability to speak publicly by signing settlement agreement). Where a party has thus contracted, POME protections are not applicable to immunize petitioning activity. See Duracraft Corp. v. Holmes Products Corp., 427 Mass. 156, 166, 691 N.E.2d 935, 942 (1998).

IL

Our conclusion that POME is inapplicable does not dispose of this appeal. Brisben's suit proceeds upon the assumption that, as NECSNA's agent, Krystkowiak can be held personally liable for interfering with the alleged contract between Brisben and NECS-NA. However, liability of this type appears to be the exception, rather than the norm.

A.

One who intentionally and improperly interferes in the performance of a contract between another and a third person is liable in tort to the other for the pecuniary loss resulting from the nonperformance of the contract. Trimble v. City & County of Denver, 697 P.2d 716, 726 (Colo.1985).

However, an agent who, while acting within the seope of official duties, causes his or her principal to breach a contract generally will not be held liable for tortious interference with that contract. See Cronk v. Inter-mountain Rural Electric Ass'n, 765 P.2d 619, 628 (Colo.App.1988); see also Larry v. Penn Truck Aids, Inc., 567 F.Supp. 1410, 1416 (E.D.Pa.1983)("The aggrieved party already has a claim against the corporate principal for breaching the [contract]. Where the individual agent of the corporation is acting in the best interest of his principal, nothing is gained by recognizing, in addition, a cause of action against the individual for inducing the breach.").

In some cireumstances, agents ostensibly acting within the seope of their official duties will be held liable for interfering with their principals contractual relations. In those instances, the inquiry focuses not on whether the agent intended the interference or at least knew that it was certain or substantially certain to occur as a result of the agent's actions, see Restatement (Second) of Torts § 766 emt. j (1979), but, rather, on whether the agent acted "improperly" in doing so. See, eg., Trimble v. City & County of Denver, supra, 697 P.2d at 720-21, 725-27 (agent acted improperly by abusing administrative authority to fire employee because of personal hostility, rather than bona fide organizational purposes).

Ordinarily, whether a person acts "improperly" in interfering with a contract depends upon consideration of the following factors: (1) the nature of the person's conduct; (2) the person's motive; (8) the interests of the other with which the person's conduct interferes; (4) the interests sought to be advanced by the person; (5) the social interests in protecting the person's freedom of action and others' contractual interests; (6) the proximity or remoteness of the person's conduct to the interference; and (7) the relations between the parties. See Trimble v. City & County of Denver, supra, 697 P.2d at 726.

Perhaps because this analysis does not readily lend itself to predicting outcomes or deciding one's rights or duties, see W.P. Keeton et al., Prosser & Keeton on Torts § 129, at 984 n. 68 (5th ed.1984), it has not been strictly applied in the agency context. See Trimble v. City & County of Denver, supro, 697 P.2d at 726-27 (noting the importance of not unduly curtailing agents' freedom to act on behalf of principals); see also Ed Peters Jewelry Co. v. C & J Jewelry Co., 124 F.3d 252, 275 (1st Cir.1997)("specialized rules apply to tortious interference claims against corporate agents").

In the agency context, the analysis focuses on whether the agent acted, in part at least, to serve the corporation's interests, see Ed Peters Jewelry Co. v. C & J Jewelry Co., supra; Young v. West Coast Industrial Relations Ass'n, 763 F.Supp. 64, 77 (D.Del.1991)(agent who usurped a corporate opportunity for himself was liable), aff'd, 961 F.2d 1570 (3d Cir.1992), or whether the agent was "motivated out of personal animus towards one or both of the contracting parties." Powell Products, Inc. v. Marks, 948 F.Supp. 1469, 1478 (D.Colo.1996); see King v. Driscoll, 418 Mass. 576, 587, 638 N.E.2d 488, 495 (1994)(agent acting with a spiteful, malignant purpose unrelated to the legitimate corporate interest was liable); Boers v. Payline Systems, Inc., 141 Or.App. 238, 243, 918 P.2d 432, 435 (1996)(agent retaliating against a party not for the benefit of the principal was liable); see also Meehan v. Amax Oil & Gas, Inc., 796 F.Supp. 461, 465 (D.Colo.1992)("Colorado courts have looked to whether the defendant acted in good faith to serve the corporation's interests and whether the defendant acted with malice towards the plaintiff or was motivated by a desire to harass or retaliate against the plaintiff").

In synthesizing these considerations, we conclude that an agent acts improperly only when he or she is motivated solely by the desire to harm one of the contracting parties or to interfere in the contractual relations between the parties. See Trimble v. City & County of Denver, supra, 697 P.2d at 726 (agent who fired employee for personal reasons was liable); Zappa v. Seiver, 706 P.2d 440, 442 (Colo.App.1985)(agent who harassed or retaliated against party to contract was liable); see also Cronk v. Intermountain Rural Electric Ass'n, supra, 765 P.2d at 623.

B.

Here, although Krystkowiak postured his motion to dismiss as one for lack of subject matter jurisdiction, see C.R.C.P. 12(b)(1), a motion to dismiss brought, as here, in connection with POME is really a motion to dismiss for failure to state a claim upon which relief can be granted. See POME, supra, 677 P.2d at 1368.

The determination whether Brisben failed to state a claim against Krystkowiak should have focused on whether Brisben adequately alleged that Krystkowiak acted outside the seope of his ageney and solely with the intent to harm one of the contracting parties or to interfere in the contract.

While the trial court did not engage in such analysis, we see no need to remand the matter where, as here, we can resolve it ourselves as a matter of law. Cf. Norsby v. Jensen, 916 P.2d 555, 559 (Colo.App.1995)(where trial court improperly treated motion to dismiss as a C.R.C.P. 12(b)(5), rather than a C.R.C.P. 12(b)(1), motion, reviewing court may, in appropriate cireum-stances, apply governing rule without remand).

In analyzing a C.R.C.P. 12(b)(B) motion, a court considers only those matters stated in the complaint, accepting them as true and viewing them in the light most favorable to the plaintiff. A court may not grant the motion to dismiss unless it appears beyond doubt that the plaintiff cannot prove facts in support of a claim that would entitle it to relief. Coors Brewing Co. v. Floyd, 978 P.2d 663, 665 (Colo.1999).

In its complaint, Brisben alleged only that, inasmuch as Krystkowiak continued to petition against its project despite his principal's prior agreement not to do so, he knowingly and intentionally interfered in the performance of that contract. Brisben did not allege that Krystkowiak "improperly" interfered with the contract. Nor did Brisben allege (or, for that matter, present any evidence to the trial court) that Krystkowiak acted outside the scope of his ageney with NECSNA, that he and NECSNA were in conflict with respect to his petitioning activity, or that he was motivated solely by a desire to harm Brisben or NECSNA or to interfere with their contract. Cf. Cronk v. Intermountain Rural Electric Ass'n, supra, 765 P.2d at 628-24 (although complaint did not allege that agent acted improperly, it alleged he acted intentionally and outside the seope of his official duties).

Although Brisben argued, in response to the motion to dismiss, that Krystkowiak had a personal motivation to act, it failed to argue that Krystkowiak was "solely" motivated to harm one of the contracting parties or to cause a breach of their contract. See King v. Driscoll, supra, 418 Mass. at 587, 688 N.E.2d at 495 ("'The motivation of personal gain, including financial gain ... generally is not enough to satisfy the improper interference requirement.").

Brisben's complaint thus failed to state a claim upon which relief could be granted against Krystkowiak. See Public Service Co. v. Van Wyk, 27 P.3d 377, 891 (Colo.2001)(affirming dismissal of trespass claim because plaintiffs "did not allege specific physical damage to their property resulting from the intangible intrusions of which they complained"); see also Roe v. Aware Woman Center for Choice, Inc., 253 F.3d 678, 684 (11th Cir.2001)(affirming dismissal of action because "Roe's complaint contains no allegations, inferential or otherwise, regarding defendants' motive, and Roe will ultimately have to prove that defendants acted with the proseribed motive if she is to prevail on the merits"); Institute for Professional Development v. Regis College, 536 F.Supp. 682, 634 (D.Colo.1982)(dismissing abuse of process claim for failure to allege improper use of process); 5A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure: Civil 2d § 1357, at 340 (1990)(under notice pleading rules, "the pleader must set forth sufficient information to outline the elements of his claim or to permit inferences to be drawn that those elements exist").

Finally, we reject Brisben's assertion that it ought to be permitted an opportunity now to amend its pleadings. While "permission to amend a complaint should be freely given where there is a possibility that the complaint could be amended to set forth a claim for which relief could be granted," Wisehart v. Zions Bancorporation, 49 P.3d 1200, 1208 (Colo.App.2002), in view of the evidence submitted to the trial court in response to plaintiff's motion to dismiss, we see no such possibility here.

Consequently, we affirm the trial court's order of dismissal, albeit on other grounds. See Bengtson v. USAA Property & Casualty Insurance, 3 P.3d 1233, 1236 (Colo.App.2000)(appellate court will uphold decision by trial court that reached correct result).

TIL

In his appeal, Krystkowiak contends that the trial court erred by denying his request under § 18-17-201 for an award of attorney fees. We agree, but on grounds different from those upon which he relies.

Because Krystkowiak's C.R.C.P. 12(b) motion to dismiss, if properly postured, would have succeeded without a POME inquiry, he may be entitled under § 18-17-201 to a reasonable portion of his attorney fees. Consequently, we remand the case to the trial court to determine what amount, if any, would be reasonable under the cireum-stances.

Accordingly, that part of the judgment dismissing Brisben's claim against Krystkowiak is affirmed; that part of the judgment denying Krystkowiak attorney fees is reversed; and the case is remanded to the trial court with directions to conduct further proceedings consistent with the views expressed in this opinion.

Judge NEY and Judge ROY concur.


author: Chief Judge HUME.

text:
    Susan J. PROVO, Petitioner, v. INDUSTRIAL CLAIM APPEALS OFFICE OF the STATE OF COLORADO, Atmel Corporation, and Industrial Indemnity Company, Respondents, and Concerning Dworkin, Chambers & Williams, P.C., jointly; and Gregory K. Chambers, individually, Respondents.
    No. 01CA1239.
    Colorado Court of Appeals, Div. II.
    Sept. 12, 2002.
    Rehearing Denied Nov. 7, 2002.
    Certiorari Denied March 24, 2003.

      Steven U. Mullens, P.C., Steven U. Mul-lens, Colorado Springs, Colorado, for Petitioner.
    Ken Salazar, Attorney General, Eric S. Rothaus, Assistant Attorney General, Denver, Colorado, for Respondent Industmal Claim Appeals Office.
    No Appearance for Respondents Atmel Corporation and Industrial Indemnity Company.
    Larry N. Harris, Littleton, Colorado, for Respondents - Dworkin, - Chambers & Williams, P.C. and Gregory K. Chambers.

       Justice RICE does not participate.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.$.2001.

   Opinion by

Chief Judge HUME.

In this workers' compensation case, Susan J. Provo (claimant) seeks review of a final order of the Industrial Claim Appeals Office (Panel) dismissing her claim for penalties against Dworkin, Chambers & Williams, P.C. and Gregory K. Chambers (collectively attorneys), the law firm and individual attorney previously representing Atmel Corporation and its insurer, Industrial Indemnity Company (collectively employer). We affirm the order in part, set it aside in part, and remand the case with mstructlons for further proceedings.

In 1998, the first Administrative Law Judge (ALJ) granted a change of medical provider and ordered employer to pay "all reasonable and necessary medical expenses for treatment" by a particular chiropractor. The ALJ specifically found that "occasional chiropractic treatment for temporary relief is especially reasonable and appropriate for Grover [v. Indus. Comm'n, T59 P.2d 705 (Colo.1988) ] medical benefits for a claimant with such severe injuries and permanent consequences." This order was not appealed.

Claimant received treatment from the chiropractor and submitted bills to employer. The attorneys advised employer that the first ALJ had not determined the reasonableness of chiropractic treatment and had not required employer to pay any specific medical benefits. Based on this advice, employer refused to pay for the chiropractic treatment.

In 1999, a second ALJ found that the 1998 order indeed required payment for this treatment and that employer's refusal to pay was wrongful, deliberate, intentional, willful, unreasonable, and legally unsupportable. Penalties were assessed against employer under the penalty statute specific to medical benefits, § 8-48-401(2)(a), C.R.S.2001, in the amount of eight percent of the wrongfully withheld medical benefits.

Claimant then applied for a hearing on the issue of penalties against the attorneys, requested at the rate of $500 per day, under the general penalty statute, § 8-43-304(1), C.R.S.2001, for the attorneys' failure to obey the 1998 order, refusal to perform their duties, and interference with claimant's medical care. The attorneys moved to dismiss the penalty claim, asserting that the general provisions in § 8-48-304(1) did not apply here because only the specific provisions in § 8-48-401(2)(a) governing medical benefits apply to denials or late payments of medical bills. Furthermore, the attorneys asserted that they could not be held liable under the specific penalty statute because that statute imposes liability only on insurers and self-insured employers. Alternatively, the attorneys argued that even if the general penalty statute were applicable, penalties could not be assessed against them because the 1998 order was directed to employer, not the attorneys.

It appears, and the parties do not dispute, that the second ALJ denied the attorneys' motion to dismiss the penalty claim. However, a signed and dated order to that effect is not in the record before us.

Before a third ALJ, the attorneys filed a second motion to dismiss based on issue preclusion, asserting that claimant was barred from relitigating the issue of whether the general penalty statute, § 8-48-804(1), applied to this claim. The third ALJ granted that motion, not on issue preclusion grounds, but on the alternative ground raised in the attorneys' first motion to dismiss. Thus, the third ALJ found that the 1998 order to pay benefits was directed to employer, not the attorneys, and because the attorneys were not parties to that order, they could not be held liable for the refusal to pay claimant's medical benefits. The ALJ also found that, other than the alleged violation of the 1998 order, claimant had listed no other basis for the penalties. Claimant then sought review before tke Panel, which affirmed.

I.

Claimant raises two procedural objections to the third ALJ's order, both of which we reject. We also reject claimant's argument that the ALJ erred in dismissing her claims for statutory violations.

A.

Claimant contends that the third ALJ exceeded his authority in reversing the order of the second ALJ. We disagree.

There is no prohibition against one judge rescinding an interlocutory order previously issued by another judge. Broyles v. Ft. Lyon Canal Co., 695 P.2d 1136 (Colo.1985)(every order made in an ongoing proceeding may be rescinded or modified during that proceeding upon proper grounds, and fact that another judge is sitting does not impair the authority of the court to act in this manner); Denver Elec. & Neon Serv. Corp. v. Gerald H. Phipps, Inc., 143 Colo. 530, 354 P.2d 618 (1960)(previously denied motion to dismiss can be renewed before another judge).

The denial of a motion to dismiss a claim for penalties is interlocutory and therefore may not be reviewed. See § 8-48-8301(2), C.R.S.2001 (petition for review may be filed only if penalty claim is granted or denied); Feigin v. Digital Interactive Assocs., Inc., 987 P.2d 876 (Colo.App.1999) (denial of a motion to dismiss is normally not reviewable because it is not a final order); M & M Mgmt. Co. v. Indus. Claim Appeals Office, 979 P.2d 574, 576 (Colo.App.1998)(where ALJ denied penalty "at this point," order was interlocutory because it left open the possibility of further litigation of the issue).

Frequently, a judge uses the law of the case doctrine to rely on a previous ruling by another judge. Application of this doe-trine, however, is discretionary, and a second judge may modify a prior ruling as necessary if new facts, changes in the applicable law, or other persuasive cireumstances warrant such modification. In re Marriage of Burford, 26 P.3d 550 (Colo.App.2001); see People ex rel. Garner v. Garner, 33 P.3d 1289 (Colo.App.2001)(one division of appellate court denied motion to dismiss; then another division granted a similar motion that raised an additional argument, even though the first ruling might have been considered law of the case); Moore v. 1600 Downing St., Ltd., 668 P.2d 16 (Colo.App.1983)(reconsideration of a motion for summary judgment, even if based on the same issues argued in earlier motions to dismiss, is not barred by law of the case doctrine).

Here, because the second ALJ's denial of the attorneys' first motion to dismiss was interlocutory, the third ALJ could subsequently grant a dismissal.

B.

In a related contention, claimant asserts that the third ALJ erred in ruling on the motion sua sponte, thereby denying her due process, because she had no notice that the order of the second ALJ would be reconsidered. She also argues that she was denied due process because she was not afforded a hearing. Again, we disagree.

Although the two motions to dismiss were ostensibly different, the common issue was whether the specific, § 8-48-401(2)(2), or the general, § 8-48-304(1), penalty statute could apply to the attorneys. Because the third ALJ was required to assess the totality of the circumstances to resolve that issue, we perceive no impropriety in his revisiting all of the arguments that had been presented up to that time.

Furthermore, an ALJ may properly reconsider a ruling sua sponte, if the parties were afforded due process in the first ruling. Cf. Antelope Co. v. Mobil Rocky Mountain, Inc., 51 P.3d 995 (Colo.App.2001)(where court converted motion in limine to motion for summary judgment, and granted summary judgment without notice to the parties and a reasonable opportunity for them to argue the disputed issues of fact and to submit affidavits and other evidence, resulting prejudice required reversal). While dismissals on the parties' motions are preferred, an ALJ may dismiss a claim sua sponte, provided that the claimant had an opportunity to be heard. See Rubins v. Plummer, 813 P.2d 778 (Colo.App.1990). The opportunity to be heard may be satisfied by the filing of written objections and is not limited to a personal appearance in the presence of an ALJ. See In re Marriage of LeBlanc, 800 P.2d 1384 (Colo.App.1990).

Here, claimant was afforded an opportunity to be heard in connection with both motions when she filed responses. She was not entitled to appear in person before the ALJ. Accordingly, there was no due process violation.

C.

Claimant next contends that the third ALJ erred in determining that she sought penalties against the attorneys only for violation of the 1998 order. She argues that the attorneys' conduct supports the imposition of penalties for various statutory violations, which are also governed by § 8-48-804(1). She specifically asserts that the attorneys may have violated §§ 8-40-102(1), 8-48-402, and 8-48-508(8), C.R.S.2001, and that the ALJ erred in summarily dismissing these claims. We agree that claimant sufficiently raised these claims in the administrative proceedings, but the claims were properly dismissed nonetheless.

Claimant's application for hearing stated: Claimant is seeking penalties at the rate of $500.00 per day under § 8-48-304(1) against [the attorneys] for their/his refusal to obey a lawfully issued Order, their/his refusal to perform duties lawfully enjoined and their/his interference with the Claimant's medical care. The basis for this penalty claim arose following the issuance of an Order by the [first ALJ] on November 17, 1998. (emphasis added)

In her response to the first motion to dismiss, claimant affirmatively stated that she was seeking penalties under $ 8-48-304(1), which provides for penalties against

[Alny employer or insurer or any officer or agent of either, or any employee, or any other person who violates any provision of articles 40 to 47 of this title, or does any act prohibited thereby, or fails or refuses to perform any duty lawfully enjoined within the time prescribed by the director or panel, for which no penalty has been specifically provided, or fails, neglects, or refuses to obey any lawful order. (emphasis added)

She explained that she was seeking penalties under this statute for the interference with medical care, which is specifically prohibited by § 8-48-508(8). She also asserted that additional facts which might be adduced at hearing could show that the attorneys' actions violated § 8-48-402, which prohibits false statements or representations. Furthermore, she asserted that the attorneys' actions were in direct violation of the legislative declaration at § 8-40-102(1), which provides that the General Assembly intended the Workers' Compensation Act to "assure the quick and efficient delivery of disability and medical benefits."

On this record, we reject the attorneys' assertion and the third ALJ's conclusion that claimant failed to raise these statutory provisions below.

D.

Because claimant raised statutory claims that were not addressed below and upon which we presume an attorney could, given a sufficient factual basis, be found liable, our ordinary course would be to remand those claims for determination by the ALJ or the Panel. Here, however, it is clear that summary dismissal was appropriate.

Summary judgments "are rulings of law in the sense that they may not rest on the resolution of disputed facts." Cooper v. Aspen Skiing Co., 48 P.3d 1229, 1232 (Colo.2002)(quoting Pierson v. Black Canyon Aggregates, Inc., 48 P.3d 1215 (Colo.2002)).

Clearly, there are no disputed facts here that may influence this determination. Accordingly, we reject claimant's argument that she is entitled to recover for alleged violations of §§ 8-40-102(1), 8-48-402, and 8-483-508(8).

Specifically, § 8-40-102(1), the legislative declaration of the Act, provides guidance, in that the Act should "be interpreted so as to assure the quick and efficient delivery of disability and medical benefits ... recognizing that the workers' compensation system in Colorado is based on a mutual renunciation of common law rights" (emphasis added). Notably absent from this language is any reference to a specific duty that the attorneys might possibly have violated. As there is no statutory duty under this section that the attorneys could possibly have violated, claimant's claim with respect to § 8-40-102(1) should be dismissed. Furthermore, claimant's reliance on Giddings v. Industrial Claim Appeals Office, 39 P.3d 1211, 1214 (Colo. for this point is unfounded.

Notably present in § 8-40-102(1) is language that workers' compensation is in derogation of the common law. Statutes in derogation of the common law are not to be expanded beyond their specific terms. See Ryals v. St. Mary-Corwin Reg. Med. Cir., 10 P.3d 654, 661 (Col0.2000). This principle guides our disposition of claimant's remaining claims.

Further, § 8-48-402 is, by its plain language, inapplicable to this case. "When the plain language of a statute is clear and unambiguous, we will not resort to interpretive rules of statutory construction and we will apply the statute as written." EHolliday v. Bestop, Inc, 23 PS8d 700, 705 (Colo.2001)(quoting Vaughan v. McMinn, 945 P.2d 404, 408 (Colo.1997)).

Section 8-48-402 provides for sanctions against anyone who takes certain action "for the purpose of obtaining any order, benefit, award, compensation, or payment under the provisions of" the Act (emphasis added). In this case, the attorneys' actions or omissions were not for the purpose of obtaining anything under the relevant articles of the Act, nor does claimant so assert. The attorneys only acted after the 1998 order was issued. Accordingly, claimant may not recover under § 8-48-402.

Finally, § 8-43-508(@) provides that no one shall "dictate to any physician the type or duration of treatment" (emphasis added). Here, the evidence shows that the attorneys advised their clients not to pay benefits for the ordered chiropractic treatment, but there is no indication that they dictated any action or inaction by any physician. Accordingly, claimant may not recover under § 8-483-508(8).

Consequently, we affirm the Panel's dismissal of claimant's statutory claims under §§ 8-40-102(1), 8-48-402, and 8-48-508(8).

II.

Next, we must determine whether penalties under § 8-48-804(1) may be assessed against an attorney representing an employer or insurer. We conclude that the violations must be predicated on statutory language which includes an attorney as a person against whom penalties may be sought and also must be based upon the attorney's fraud or malice.

A.

Section 8-48-804(1) appears to be potentially applicable to attorneys. That seetion provides that penalties may be assessed against "any officer or agent" of the employer or insurer "or any other person" for violating "any provision of articles 40 to 47 of this title," doing "any act prohibited thereby," failing or refusing to perform "any duty lawfully enjoined," or failing, neglecting, or refusing to "obey any lawful order made by the director or panel."

An attorney representing an employer or insurer or both clearly is an "agent" of the employer or insurer and is "any other person." Compare § 8-48-804(1) (allowing penalties against "any other person"), with § 8-48-401(2)(a) (limiting penalties to only the "insurer or self-insured employer").

B.

- However, it is a basic rule that attorneys generally cannot be held liable to third parties for advice given to their clients. See Montano v. Land Title Guar. Co., 778 P.2d 328 (Colo. for limiting the liability of attorneys to nonelients include: (1) the attorney's duty of loyalty and effective advocacy for the client; (2) the nature of the adversarial relationship between an attorney and other parties; and (8) the potential for liability to an unlimited number of third parties).

This rule has two relevant exceptions. The first exception is generally applicable and is invoked where there is a finding of fraud or malice. See Weigel v. Hardesty, 37 Colo.App. 541, 548, 549 P.2d 1335, 1337 (1976); see also Mehaffy, Rider, Windholz & Wilson v. Central Bank Denver, 892 P.2d 230 (Colo.1995)(expanding upon the fraud or malice standard to include negligent misrepresentation under particularized facts of case). The second exception, specific to the context of § 8-43-304(1), is invoked where an attorney has willfully violated an order that specifically directs the attorney to act.

Here, the attorneys have not violated any orders directed at them personally, making the second exception inapplicable. Therefore, we hold the attorneys may be held liable for penalties under § 8-483-804(1) only upon a finding that their conduct was fraudulent or malicious. We need not address negligent misrepresentation pursuant to Mehaffy, supra, because no such theory was presented here.

Accordingly, upon remand to the Panel for a determination whether penalties should be imposed under § 8-48-304(1) for violation of the 1998 order, claimant must be given the opportunity to prove that the attorneys' conduct was fraudulent or malicious.

C.

We reject attorneys' continued assertion that the applicable penalty provision is the specific penalty statute, § 8-48-401(2)(a), and that the prior "gravamen" test applies. The gravamen test looked to the underlying basis of the complaint to determine if a specific penalty existed for that basis. See Giddings v. Indus. Claim Appeals Office, supra, 39 P.3d at 1215 (citing Sears v. Penrose Hosp., 942 P.2d 1345, 1347 (Colo.App.1997)). Although that was the law when the second ALJ imposed penalties against employer, it is no longer the law. See Holliday v. Bestop, Inc., supra; see also Giddings v. Indus. Claim Appeals Office, supra, 39 P.3d at 1215 ("[tYhus, it appears that the supreme court [in Holliday ] has overruled the Sears 'gravamen' test"). The issue on remand involves the attorneys' direct liability to claimant for their role in the violation of the 1998 order.

We also reject the attorneys' argument that under the doctrine of issue preclusion, claimant is barred from relitigating whether § 8-48-304(1) applies here. The previous proceedings have not examined the attorneys' culpability in the denial of benefits based on the rule announced above. Consequently, claimant did not have any reason to address this issue in the prior proceedings and is not now precluded from addressing the issue. See Sunny Acres Villa, Inc. v. Cooper, 25 P.3d 44, 47 (Colo.2001).

Accordingly, we remand the portion of the case regarding the applicability of penalties under § 8-48-304(1) against the attorneys for their role in violating the 1998 order. The Panel is directed to decide this issue pursuant to the rule announced in part II(B) of this opinion.

We deny the attorneys' request for an award of attorney fees based on the frivolous and groundless nature of the appeal. See One Hour Cleaners v. Indus. Claim Appeals Office, 914 P.2d 501 (Colo.App.1995).

The order of the Panel with respect to penalties under § 8-48-804(1) is set aside, and the case is remanded for further proceedings before the Panel in accordance with the views expressed in this opinion. The Panel's order dismissing claimant's claim for penalties against the attorneys alleged under §§ 8-40-102(1), 848-402, and 8-48-508(8) is affirmed.

Judge TAUBMAN and Judge STERNBERG concur.