Rodgers v. Georgia Tech Athletic Ass'n
303 S.E.2d 467, 1983 Ga. App. LEXIS 2084, 166 Ga. App. 156 (1983)
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Rule of Law:
When an employment contract is breached without cause, recoverable damages may include the value of lost 'perquisites,' including those from third-party sources, if they were contemplated by the parties as part of the employee's compensation package. However, benefits that are purely business expenses or 'tools of the trade' necessary only for job performance are not recoverable after the employee's duties have been removed.
Facts:
- The Georgia Tech Athletic Association ('the Association') hired Franklin C. 'Pepper' Rodgers as its head football coach under a multi-year employment contract.
- The contract specified an annual salary and entitled Rodgers to various 'perquisites as [he] become[s] eligible therefor.'
- During his employment, Rodgers received numerous benefits, some directly from the Association (e.g., car expenses, game tickets, country club memberships) and others from third parties due to his position (e.g., profits from TV/radio shows, use of a new car).
- On December 18, 1979, with approximately two years remaining on his contract, the Association's Board of Trustees removed Rodgers from his coaching duties.
- The Association's decision to remove Rodgers was not for any of the 'for cause' reasons specified in the contract, such as moral turpitude or conduct embarrassing to the school.
- Following his removal, the Association continued to pay Rodgers' base salary but discontinued providing the perquisites associated with his position.
Procedural Posture:
- Franklin C. Rodgers filed a breach of contract action against the Georgia Tech Athletic Association in the State Court of Fulton County.
- Both parties filed motions for summary judgment in the trial court.
- The trial court granted the Association's motion for summary judgment and denied Rodgers' motion.
- Rodgers, as appellant, appealed the trial court's judgment to the Court of Appeals of Georgia.
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Issue:
Does the term 'perquisites' in an employment contract for a head football coach, which was breached by the employer without cause, encompass fringe benefits provided by both the employer and third parties, entitling the coach to recover their value as damages?
Opinions:
Majority - Pope, Judge.
Yes, the term 'perquisites' can encompass fringe benefits from both the employer and third parties, and the coach may be entitled to recover their value. A wrongfully discharged employee is entitled to damages that represent the actual loss sustained by the breach, which can include the value of perquisites contemplated by the contract. The court found the contract ambiguous as to the scope of 'perquisites' and construed it against the drafter (the Association), concluding it included benefits specific to the head coach position, not just those available to all employees. However, recovery is limited. Items that are purely business expenses or 'tools' for performing duties (like a secretary or work-related travel) are not recoverable since the duties were removed. For third-party benefits to be recoverable, they must have been contemplated by both parties at the time of contracting, their loss must be a direct result of the breach, and their value must be capable of reasonably certain computation. Therefore, benefits like speculative gifts or those unknown to the employer are not recoverable.
Analysis:
This decision clarifies that damages for a breach of an employment contract can extend beyond base salary to include the value of fringe benefits, even those provided by third parties. It establishes a crucial distinction between perquisites that are part of an employee's overall compensation package and those that are merely business expenses. The ruling underscores the importance of precise contract drafting, as ambiguities regarding compensation will likely be construed against the employer. For future cases involving high-profile employees with complex compensation structures, this case provides a framework for determining which non-salary benefits are recoverable as contract damages.
