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Keywords

contractlawsuitbreach of contracttortattorneycontractual obligation
contractbreach of contractplaintiffdefendantattorneyappealrespondentappellant

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Nordling v. Northern States Power Co., 478 N.W.2d 498, 60 USLW 2406, 124 Lab.Cas. P 57,260, 7 IER Cases 10

Facts

Gale K. Nordling began working for NSP in 1971 and became an in-house attorney in 1975. His employment was governed by NSP's Employee Handbook, which outlined a Positive Discipline system for addressing employee behavior. In 1987, after Nordling objected to a proposed investigation plan that he believed involved illegal activities, he faced scrutiny from his supervisor, David McGannon, and was ultimately discharged without following the disciplinary procedures outlined in the handbook. Nordling subsequently filed a lawsuit against NSP and McGannon, alleging wrongful discharge and other claims.

Plaintiff-appellant Gale K. Nordling began working for defendant-respondent Northern States Power Company (NSP) in 1971 as an engineer. While working, he also attended law school with NSP's help and in 1975 became a duly licensed Minnesota attorney.

Issue

Whether an in-house attorney's status as corporate counsel alters the ordinary attorney-client relationship, thereby affecting the attorney's ability to bring a wrongful discharge claim against the employer.

The main issue is whether an attorney's status as in-house counsel alters the ordinary attorney-client relationship under which the client has the right to discharge its attorney at any time.

Rule

An employee who is an in-house attorney is not precluded from bringing a wrongful discharge claim against their employer due to the attorney-client relationship, provided that the employer has not followed its own disciplinary procedures.

The general rule, long established in this state, is that the client has the right to discharge its attorney with or without cause.

Analysis

The court analyzed the nature of the attorney-client relationship in the context of employment, concluding that while NSP had the right to discharge Nordling as its attorney, it was also bound by the contractual obligations outlined in the Employee Handbook. The court found that the failure to follow the Positive Discipline procedures before termination raised factual questions regarding Nordling's claims, particularly concerning the tortious interference with contract.

Relevant, we think, is the evidence that Nordling's 'clients' in the engineering department for whom he did legal work found him to be competent and personally compatible, as did almost all of his colleagues in the legal department.

Conclusion

The court reversed the lower court's ruling that dismissed Nordling's claims and remanded the case for further proceedings, allowing Nordling to pursue his claims for breach of contract and tortious interference.

We reverse, therefore, the court of appeals' ruling denying Nordling the right to proceed with his action for breach of contractual provisions in an employee handbook.

Who won?

Gale K. Nordling prevailed in part, as the court allowed him to proceed with his claims for breach of contract and tortious interference, emphasizing that the attorney-client relationship did not shield NSP from its contractual obligations.

In this case we decide that an employee who is in-house attorney for his corporate employer is not, by reason of the attorney-client relationship, precluded from making a claim against the employer for wrongful discharge.

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