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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Mills v. Hankla (3/22/2013) sp-6765

Mills v. Hankla (3/22/2013) sp-6765

        Notice: This opinion is subject to correction before publication in the PACIFIC  REPORTER . 

        Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 

        303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email 

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                THE SUPREME COURT OF THE STATE OF ALASKA 



WILLIAM MILLS, KAREN MILLS,                       ) 

ANNETTE McLAUGHLIN, and                           )   Supreme Court No. S-14041 

CAROLE WELSH,                                     ) 

                                                  ) 

                       Appellants,                ) 

                                                  )   Superior Court No. 1JU-09-00466 CI 

        v.                                        ) 

                                                  )   O P I N I O N 

JEFFERSON HANKLA and the                          ) 

CITY OF HOONAH,                                   ) 

                                                  )   No. 6765 - March 22, 2013 

                       Appellees.                 ) 

                                                  ) 



               Appeal from the Superior Court of the State of Alaska, First 

               Judicial District, Juneau, Philip M. Pallenberg, Judge. 



               Appearances: Douglas K. Mertz and William F. Cummings, 

               Mertz      Law    Offices,   Juneau,    for   Appellants.      Leslie 

               Longenbaugh,        Margot    Knuth,    and   Janice   Gregg    Levy, 

               Longenbaugh        Law    Firm,   Juneau,   for  Appellee     City  of 

               Hoonah.      Vance     A.   Sanders,   Law    Office   of  Vance    A. 

                Sanders, LLC, Douglas, for Appellee Jefferson Hankla. 



               Before:     Carpeneti,    Chief   Justice,  Winfree    and   Stowers, 

               Justices.   [Fabe, Justice, not participating.] 



               WINFREE, Justice. 



I.      INTRODUCTION 



               In 2008 a city promoted a police officer to police chief.         The city’s hiring 



determination and the officer’s subsequent conduct led four police department employees 


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to sue the police chief and the city.        The employees asserted several claims including 



wrongful   termination,   sexual   harassment,   and   negligent   hiring.       The   superior   court 



entered summary judgment in favor of the police chief and the city on all claims. 



                The employees appeal several of the superior court’s summary judgment 



rulings, its denial of sanctions for evidence spoliation, and an attorney’s fees award in 



the city’s favor.  Because there are no genuine issues of material fact barring judgment, 



we    affirm    the  superior    court’s   dismissal    of   both   the  employees’      hostile   work 



environment   sexual   harassment   claims   against   the   police   chief   and   the   employees’ 



negligent hiring claim against the city.          Because the superior court did   not abuse its 



discretion in denying discovery sanctions, we affirm that ruling as well.                But because 



genuine issues of material fact preclude summary judgment as to the employees’ claims 



against   the   city   for   wrongful   termination   and   sexual   harassment,   we   reverse   those 



rulings, vacate the attorney’s fees award, and remand for further proceedings. 



II.     FACTS AND PROCEEDINGS 



                A.      Facts 



                        1.      Chief Hankla 



                In 2006 the City of Hoonah (the City) hired Jefferson Hankla as a patrol 



officer with the Hoonah Police Department.  In early 2008 Hankla applied for an open 



position as police chief.   The city council appointed Hankla as police chief in February, 



but later was informed by Hankla’s colleague, Lieutenant William Mills, that Hankla did 



not meet the eligibility requirements for the position, making the appointment a violation 



of city code.  The mayor rescinded the appointment; the city council then amended the 



city   code   to   allow   Hankla   to   qualify   and   re-opened   the   position. Lt.   Mills   had   not 



applied for the position when it was first advertised, but he applied when the position re­ 



opened.    In April, the city council again appointed Hankla as police chief. 



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                        2.      Chief Hankla and Lt. Mills 



                Following Chief Hankla’s second appointment, relations between Chief 



Hankla   and   Lt.   Mills   broke   down.   According   to   the   employees,   tension   developed 



within the police department between those who supported Chief Hankla and those who 



did not.  Lt. Mills and Chief Hankla avoided each other at work.  Lt. Mills claimed Chief 



Hankla filed false reports concerning Lt. Mills’s work and foreshadowed a termination 



by talking about “an opening” in the department.            When the police department hired a 



new officer, Chief Hankla trained the new employee even though   Lt. Mills was the 



department’s training officer.   Lt. Mills claimed Chief Hankla favored others within the 



department in various ways, including having personal driveways plowed by the city, 



allowing   an   employee   to   come   to   work   drunk,   allotting   more   overtime   work,   and 



arranging rent-free city housing.        Lt. Mills claimed those disfavored by Chief Hankla 



“were subjected to humiliation and high-handedness, intended to drive [them] away.” 



                In   late   April,   three   weeks   after   Chief   Hankla’s   appointment,   someone 



contacted   Lt.   Mills   about   an   opening   with   the   Craig   Police   Department.  Lt.   Mills 



applied, was offered the position, and accepted the next day.  Lt. Mills gave three weeks 



notice of his resignation and left Hoonah in late May. 



                        3.      Chief Hankla and dispatcher Welsh 



                Carole Welsh was hired as the Hoonah Police Department’s dispatcher in 



2006.     Welsh      claimed    that  throughout     her   employment      before    Chief   Hankla’s 



appointment, then-patrol-officer Hankla repeatedly asked to see her breasts, and that she 



always refused.      She claimed that these requests were only made when the two were 



alone,   and   that   she   never   told   anyone. Shortly   after   Chief   Hankla’s   appointment, 



Welsh’s husband accepted a job in Washington and the family relocated.  On her final 



day of work, “as [her] shift ended,” she entered Chief Hankla’s office to have him sign 



her time card.    Welsh claimed that during this encounter, Chief Hankla requested one 



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final time to see her breasts.     Again, Welsh refused. 



                        4.      Chief Hankla and dispatchers Mills and McLaughlin 



                Karen Mills and Annette McLaughlin were dispatchers with the Hoonah 



Police Department while Chief Hankla was in charge.                 Both Mills and McLaughlin 



claimed they observed Chief Hankla behave inappropriately or make sexual comments. 



They claimed Chief Hankla reduced their hours and altered their time cards to deny them 



overtime pay.      They also claimed Chief Hankla sent sexually inappropriate emails to 



members of the police department. 



                McLaughlin claimed that while she was working, Chief Hankla once saw 



her accidentally open an email containing pictures of topless women. She claimed Chief 



Hankla told her “if [she] wanted to [she] could take some pictures of [her]self topless and 



send them to his email.”       McLaughlin also described arriving late for a party at Chief 



Hankla’s house and explaining that she came directly from the shower — she claimed 



that   he   replied,   “If   you’re   naked,   come   on   in.” McLaughlin   further   claimed   Chief 



Hankla   commented   on   the   clothes   she   wore   to   work   and   she   was   aware   of   crude 



comments Chief Hankla made to other employees. 



                Mills described several instances that she claimed “show a pattern of sexual 



harassment.”     Mills claimed after Chief Hankla returned to the police station following 



a fire call near another female dispatcher’s home, Chief Hankla told the dispatcher, in 



Mills’s presence, that “he had looked over to [the dispatcher’s] house, hoping to see her 



standing in her front window wearing something ‘small and see-through.’ ” She claimed 



she heard Chief Hankla joke that he was going to purchase new dispatcher uniforms from 



Victoria’s Secret.  She also described one occasion when Chief Hankla approached her 



from behind to get a stapler and put his hand on her back. 



                                                 -4-                                            6765
 


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        B.       Proceedings 



                 1.      The employees’ suit 



                 Lt. Mills and dispatchers Mills, McLaughlin, and Welsh sued Chief Hankla 



and   the   City   on   several   theories. The   scope   of   the   employees’   amended   complaint 



caused some contention between the parties, with confusion about the actual claims 



pleaded.   The following claims are specifically enumerated in the employees’ amended 



complaint and are the subject of this appeal. 



                 Lt. Mills claimed that Chief Hankla, and therefore the City, constructively 



discharged      Lt.  Mills   through     “harassment      and   unprofessional      treatment,”    thereby 



breaching the covenant of good faith and fair dealing.                Lt. Mills claimed that the City 



improperly refused to consider other candidates and hired Chief Hankla in violation of 



the   city   code,   and   further   that   Chief   Hankla   and   the   City   violated   public   policy   by 



retaliating   against   Lt.   Mills   for   competing   with   Chief   Hankla   for   the   police   chief 



position.  The three dispatchers claimed Chief Hankla and the City maintained a hostile 



work     environment       through    sexual    harassment     and   discrimination      in  violation    of 

AS   18.80.220(a).1      Mills   and   McLaughlin   also   claimed   Chief   Hankla   and   the   City 



violated   wage   and   overtime   laws   by   altering   time   cards   and   denying   overtime   pay. 



Lt. Mills and the three dispatchers further claimed the City was negligent in hiring, 



training, and retaining Chief Hankla. 



                 2.      The employees’ motion for sanctions 



                 The employees moved for sanctions against Chief Hankla and the City for 



        1        AS 18.80.220(a) makes it unlawful for an employer “to discriminate against 



a person in compensation or in a term, condition, or privilege of employment . . . because 

of the person’s age, physical or mental disability, sex, marital status, changes in marital 

status, pregnancy, or parenthood when the reasonable demands of the position do not 

require distinction . . . .” 



                                                    -5-                                              6765
 


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spoliation of evidence.  The employees alleged Chief Hankla and the City failed to turn 



over two pieces of evidence: Chief Hankla’s police department personnel file and former 



Hoonah   Mayor   Alf   Skaflestad’s   citizen   complaints   file.        The   employees   pointed   to 



testimony   from   the   previous   police   chief   describing   Chief   Hankla’s   personnel   file, 



including performance and psychological evaluations, medical file, and discipline record. 



The   employees   claimed   that   they   did   not   receive   the   personnel   file   and   that   it   was 



reasonable to conclude Chief Hankla had destroyed it.                The employees also pointed to 



testimony from Skaflestad describing a file of complaints against Chief Hankla “several 



inches” thick and kept in a “secret” drawer in Skaflestad’s desk.  Claiming they did not 



receive   the   complete   file,   the   employees   argued   it   must   have   been   destroyed.     The 



employees requested sanctions, including exclusion of evidence and shifting the burden 



of proof.    Chief Hankla and the City asserted they had produced both files and argued 



the   allegedly   destroyed   or   withheld   evidence   was   irrelevant.      The   court   denied   the 



motion for sanctions, finding no evidence of destruction or failure to produce evidence. 



                 3.	     Chief Hankla and the City’s motion to exclude expert testimony 

                         and allegedly new claims 



                 Chief Hankla and the City moved to exclude Welsh’s and Lt. Mills’s expert 



testimony and reports on economic damages and to exclude evidence relating to claims 



not   pleaded,   including   Welsh’s   wrongful   termination   and   retaliation   claims.         Chief 



Hankla and the City argued that the expert testimony and reports were prejudicially late 



and that the deadline to amend pleadings had passed. 



                 The    employees      responded      that  both   sides   had    caused    the  delay    in 



submitting expert testimony and reports.   Welsh also argued that her claim for economic 



damages was based on (1) being compelled, as a result of Chief Hankla’s harassment, 



to leave her position at the police department and (2) a later poor performance review 



from Chief Hankla that prevented her from acquiring new work.                       Welsh argued that 



                                                    -6-	                                             6765
 


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Chief   Hankla   and   the   City   were   aware   that   she   sought   economic   damages   and   that 



although the amended complaint did not specifically reference constructive termination 



or   retaliation,   Chief   Hankla   and   the   City   “ha[d]   done   discovery   and   litigated   with 



knowledge of [the claims].” 



                The    superior    court  granted    the  motion    to  exclude    Welsh’s    wrongful 



constructive discharge and retaliation claims and to preclude Welsh’s and Lt. Mills’s 



expert testimony.      The court recognized a plaintiff does not have to plead a separate 



cause of action for constructive discharge to receive economic damages, but found Welsh 



had not indicated she was pursuing economic damages until the last day of discovery and 



did not itemize her damages until two weeks before trial.             The court further concluded 



it was not clear from the pleadings that Welsh was asserting a retaliation claim. 



                4.      Motion for summary judgment 



                Chief Hankla and the City moved for summary judgment on all of the 



employees’ claims.         The superior court granted summary judgment in favor of Chief 



Hankla and the City on all but one claim, concluding that onlyWelsh’s sexual harassment 



claim presented a genuine issue of material fact. The court explained that an issue of fact 



existed whether Welsh   was still employed by the City when Chief Hankla allegedly 



made his final request to see Welsh’s breasts, the only alleged request made while he was 



police chief.  The court also concluded that if the City could be liable, then Chief Hankla 

could be personally liable under the aiding and abetting provision of AS 18.80.260.2 



                As to Lt. Mills’s wrongful constructive discharge claim, the court noted that 



Lt. Mills did not appear to contest summary judgment.              The court explained that Chief 



Hankla and the City had made a prima facie showing that there was no material issue of 



        2       AS 18.80.260 provides, “It is unlawful for a person to aid, abet, incite, 



compel, or coerce the doing of an act forbidden under this chapter or to attempt to do so.” 



                                                  -7-                                               6765 


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fact as to the constructive discharge element of the claim, and entered summary judgment 



in their favor without considering whether there was sufficient evidence to support a 



claim for breach of the covenant of good faith and fair dealing.               As to Lt. Mills’s claim 



of retaliation against public policy for exercising his right to seek public employment, 



the   court   entered   summary   judgment   because   “[Lt.   Mills]   provid[ed]   no   authority 



whatsoever for the existence of the tort . . . nor [was] the court aware of any case in 



which [that] tort has been recognized.” 



                 As   to  Mills’s   and   McLaughlin’s   sexual   harassment   claims,   the   court 



concluded Chief Hankla’s alleged conduct was not “sufficiently severe or pervasive to 



alter the conditions of the victim[s’] employment,” and could not amount to a hostile 



work     environment   in   violation   of   AS   18.80.220.       Additionally,   as     to  Mills’s   and 



McLaughlin’s claims against the City for denial of overtime wages, the court explained 



                                           3 

that the Alaska Wage and Hour Act  under which the employees brought their claim did 



not    apply   to  subdivisions     of  the   state,  including     the  City.   Although       Mills   and 



McLaughlin argued that alterations of time cards and denial of overtime amounted to 



violations of federal law and the Hoonah code, to discriminatory treatment, and to breach 



of the covenant of good faith and fair dealing, the court concluded that none of those 



“hypothetical causes of action” had been pleaded and declined to consider the theories. 



                 As to the negligent hiring, training, and retention claims against the City, 



the court concluded the claims were precluded by discretionary function immunity under 

AS 09.65.070.4      With respect to negligent training, the court explained it was “unaware 



        3        AS 23.10.050-.150. 



        4        AS 09.65.070(d) provides, “An action for damages may not be brought 



against a municipality or any of its agents, officers, or employees if the claim . . . is based 

upon the exercise or performance or the failure to exercise or perform a discretionary 

                                                                                           (continued...) 



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of authority for the proposition that there is an independent cause of action for ‘negligent 



training,’ ” but noted it may be relevant to the remaining sexual harassment claim. 



                5.      Chief Hankla and the City’s motion for reconsideration 



                Chief   Hankla   and   the   City   moved   for   reconsideration   of   the   denial   of 



summary judgment on Welsh’s sexual harassment claim.                    They pointed to portions of 



Welsh’s affidavit, deposition testimony, and interrogatory responses which they asserted 



showed that Chief Hankla’s only alleged request to see her breasts while he was police 



chief occurred after Welsh had left the City’s employment. At a status hearing, the court 



granted the reconsideration motion and entered summary judgment against Welsh on this 



final claim.  Welsh protested the ruling, concerned that it precluded a common law claim 



for intentional infliction of emotional distress.   The court responded that Welsh had not 



pleaded intentional infliction of emotional distress. 



                6.      Offers of judgment and fee awards 



                 Shortly before discovery closed, Chief Hankla and the City tendered Alaska 



Civil Rule 68 offers of judgment of $2,000 each to Lt. Mills and dispatchers Mills and 



McLaughlin,   and   $4,000   to   dispatcher   Welsh.       The   employees   did   not   accept   these 



offers, and following dismissal of all of the employees’ claims by way of summary 



judgment, Chief Hankla and the City moved for Rule 68 attorney’s fees. The employees 



opposed, arguing that the Rule 68 offers were invalid because they would have left the 



employees with no net recovery.  The superior court rejected the employees’ argument 



and granted the motion in full, holding the employees jointly and severally liable for 



Rule 68 fees and costs in excess of $100,000. 



        4       (...continued) 



function . . . .” 



                                                   -9-                                               6765 


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                7.      Appeal 



                On appeal the employees challenge the superior court’s denial of discovery 



sanctions, grant of summary judgment, and entry of attorney’s fees. 



III.    DISCUSSION 



        A.      Discovery Sanctions 



                The employees argue that the superior court erred in denying their request 

for   discovery   sanctions   for   spoliation   of   evidence.5 “We   review   a   superior   court’s 



rulings on discovery issues for abuse of discretion.”6         We review a trial court’s findings 



of fact underlying its discovery sanction determination for clear error and “will not 



declare a trial court’s finding to be clearly erroneous unless, after a review of the entire 

record, we are left with a definite and firm conviction that a mistake has been made.”7 



                The    employees      claim   that  the  City   withheld    documents     from    Chief 



Hankla’s personnel file, including a psychological evaluation, performance evaluations, 



medical files, a file of citizen complaints, and a disciplinary record.           They note that the 



previous police chief referred to those documents as part of Chief Hankla’s personnel 



file.  The employees also argue that the City withheld former Mayor Skaflestad’s file of 



complaints until shortly before the then-scheduled trial. 



        5       See Doubleday v. State, Commercial Fisheries Entry Comm’n, 238 P.3d 



100,    106   (Alaska    2010)   (explaining    party   claiming    spoliation   to  gain  evidentiary 

presumption must demonstrate missing records hindered the party’s ability to establish 

prima   facie   case   and   adverse   party   either   intentionally   or   negligently   destroyed   or 

withheld records). 



        6       Wooten v. Hinton, 202 P.3d 1148, 1155 (Alaska 2009). 



        7       Spenard Action Comm. v. Lot 3, Block 1, Evergreen Subdivision, 902 P.2d 



766, 776 (Alaska 1995) (internal citations omitted). 



                                                 -10-                                            6765
 


----------------------- Page 11-----------------------

                As to Chief Hankla’s personnel file, the superior court recognized that the 



previous police chief referred to documents not in the personnel file turned over to the 



employees, but the court concluded that the discrepancy was not sufficient to establish 



spoliation and that it was not clear the documents were relevant.               City Clerk Marlene 



Duvall   stated   that   the   entirety   of   Chief   Hankla’s   file   was   turned   over   to   the   City’s 



attorney.  She noted that personnel files were under her supervision and control and that 



city policy provided no employees, including the police chief, were to keep separate 



personnel files.     She also stated that psychological evaluations were   not kept in the 



personnel files.    Given the lack of evidence indicating destruction or withholding, we 



conclude that it was not clearly erroneous to find no spoliation and that it was not an 



abuse of discretion for the superior court to deny sanctions regarding Chief Hankla’s 



personnel file. 



                As to Skaflestad’s complaints file, early in the litigation the City obtained 



Skaflestad’s   files   and   turned   over   all   non-privileged   documents   to   the   employees. 



Skaflestad later stated that he had continued to add to his file.           Upon learning of these 



additions, the City requested a copy of the expanded file and subsequently gave a copy 



to the employees.      The City’s attorney stated that she did not know about Skaflestad’s 



late additions until the spoliation claim arose, and the employees presented no evidence 



showing otherwise.       The superior court’s finding that there was no spoliation was not 



clearly erroneous, and in light of that finding it did not abuse its discretion in denying 



sanctions regarding Skaflestad’s file. 



        B.      Summary Judgment 

                We review a grant of summary judgment de novo8 to “determine whether 



        8       Yost v. State, Div. of Corps., Bus. & Prof’l Licensing, 234 P.3d 1264, 1272 



(Alaska 2010). 



                                                  -11-                                              6765 


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any genuine issue of material fact exists and whether the moving party is entitled to 

judgment on the law applicable to the established facts.” 9    “[W]e construe the facts in the 



light most favorable to the non-moving party . . . .”10 



               1.     Lt. Mills’s wrongful termination claim against the City 



               Lt. Mills challenges the superior court’s entry of summary judgment on his 



wrongful termination claim.      To prevail on a wrongful termination claim, an employee 



must prove (1) the employee was terminated by his or her employer and (2) the employer 

breached     a  contract  or  committed     a  tort  in  connection   with   the  termination.11 



“Constructive discharge satisfies the first element; a breach of the implied covenant of 

good faith and fair dealing satisfies the second.”12 



               “Constructive     discharge   occurs   where    an  employer    makes    working 



conditions so intolerable that a reasonable person in the employee’s position would have 

felt compelled to resign.”13   The employee must show that he or she was “forced into an 



involuntary     resignation.”14  Constructive     discharge   may   result  from   a  “sustained 



        9      Wright v. State, 824 P.2d 718, 720 (Alaska 1992). 



        10     McCormick v. City of Dillingham , 16 P.3d 735, 738 (Alaska 2001). 



        11     Okpik v. City of Barrow, 230 P.3d 672, 679 (Alaska 2010) (quoting Charles 



v. Interior Reg’l Hous. Auth. , 55 P.3d 57, 59 (Alaska 2002)). 



        12     Id. (citations omitted). 



        13     Pyramid Printing Co. v. Alaska State Comm’n for Human Rights , 153 P.3d 



994, 999 (Alaska 2007) (quoting Cameron v. Beard, 864 P.2d 538, 547 (Alaska 1994)) 

(internal quotation marks omitted). 



        14     Beard v. Baum , 796 P.2d 1344, 1350 (Alaska 1990). 



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campaign” of harassment.15       For example, in Cameron v. Beard the employee presented 



evidence that the employer had campaigned to vote him out of his position as union 



representative; submitted unjustified negative job performance evaluations; stated he 

would never be promoted; and warned that he was about to be fired.16                 We held those 



facts were sufficient to support a jury’s constructive discharge finding.17            Similarly, in 



Finch v. Greatland Foods, Inc. the employee alleged that the employer criticized him for 



taking family leave; reassigned his distribution route to a junior employee; altered the 



pay system such that only his income dropped; and failed to support his customer service 

efforts.18  Any of the events alone might not have supported a constructive discharge 



claim, and the employer submitted strong evidence controverting the alleged events.19 



But when reviewing summary judgment we view the events “in totality and in the light 

most favorable to [the employee],”20 and in that light, we held the events could lead a 



reasonable person in the employee’s position to conclude that the employer pursued a 

sustained campaign of harassment, compelling the employee’s resignation.21 



                Viewing the facts of this case in totality and in the light most favorable to 



Lt. Mills, there is a genuine issue of material fact whether Chief Hankla and the City 



        15      Finch v. Greatland Foods, Inc. , 21 P.3d 1282, 1285-86  (Alaska 2001) 



(quoting Cameron, 864 P.2d at 547). 



        16      864 P.2d at 540-41, 548. 



        17      Id. at 548. 



        18      21 P.3d at 1286. 



        19      Id. 



        20      Id. 



        21      Id. 



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engaged in a sustained campaign of harassment, leaving Lt. Mills no reasonable choice 



but to leave.   Although we agree with Chief Hankla and the City that merely believing 



one’s    supervisor     is  critical  or  incompetent      does   not   create   intolerable    working 

conditions,22 Lt. Mills asserted more. Lt. Mills claimed Chief Hankla made it known that 



Lt. Mills was an “enemy”; filed false reports concerning his work; removed his training 



duties; and foreshadowed a termination by talking about “an opening” in the department. 



And given the testimony regarding the City’s favorable treatment of Chief Hankla — 



including amending the city code to make him eligible to become police chief and not 



responding to complaints lodged against him — a reasonable jury could conclude Lt. 



Mills    had   a  well-founded     belief   the  City  was   not   likely  to  protect   him   from   the 



harassment, thereby compelling his resignation. 



                The fact that Lt. Mills left the police department for another job does not 



preclude a constructive discharge claim. Lt. Mills asserted he did not plan on leaving the 



department and explained, “I would not have left Hoonah if I thought I had a choice.” 



In the light most favorable to Lt. Mills, the fact that his departure was for a position 



elsewhere does not require us to conclude he did not reasonably feel compelled to leave. 



                As   to   the   second   element   of   a   wrongful   termination   claim   —   a   tort   or 



breach of contract connected with the termination — we conclude that Lt. Mills raised 



a genuine issue of material fact concerning a breach of the implied covenant of good 



faith and fair dealing.      We have explained that “[t]he covenant operates as a check on 



employers’ traditional freedom to terminate at-will employment for any reason” and 



        22      See Pitka v. Interior Reg’l Hous. Auth. , 54 P.3d 785, 790 (Alaska 2002) 



(“[C]riticism of job performance or other management decisions do not, standing alone, 

create intolerable workplace conditions . . . .”         (quoting Cameron, 864 P.2d at 547)). 



                                                  -14-                                               6765 


----------------------- Page 15-----------------------

contains subjective and objective components.23              The objective component “requires 



employers to act in a manner that a reasonable person would regard as fair.”24                     The 



subjective   component is breached if the employer “discharges the employee for the 

purpose of depriving him or her of one of the benefits of the contract.”25 “[G]enerally 



whether the covenant has been breached is a question for the trier of fact.”26 



                In  Finch ,   where    there   was   sufficient   evidence    to  support   a  claim   of 



constructive discharge through a sustained campaign of harassment, we explained that 



it “follow[ed] that [there was] sufficient evidence to overcome summary judgment on 

[the] breach of covenant.”27       The same is true here.      Lt. Mills asserted that he had been 



subjected   to   “a   campaign   of   hostility   and   retaliation”   from   the   time   Chief   Hankla 



“declared [Lt. Mills] an enemy and began cutting back on [his] duties and in other ways 



trying to drive [him] out.”       Taking the asserted events in the light most favorable to 



Lt. Mills, there are genuine issues of material fact whether Chief Hankla’s and the City’s 



alleged   “harassment   and   unprofessional   treatment”   were   objectively   unfair   or   were 



subjectively intended to deprive Lt. Mills of the benefits of his employment. 



                Chief Hankla and the City argue that Lt. Mills did not address his wrongful 



termination claim in the opposition to summary judgment.                 Although the employees’ 



        23      Hoendermis       v.  Advanced     Physical   Therapy,   Inc. ,   251   P.3d   346,   356 



(Alaska 2011) (quoting Era Aviation, Inc. v. Seekins , 973 P.2d 1137,   1139   (Alaska 

1999)). 



        24      Id. (quoting Charles v. Interior Reg’l Hous. Auth., 55 P.3d 57, 62 (Alaska 



2002)) (internal quotation marks omitted). 



        25      Id. (internal quotation marks omitted). 



        26      Okpik v. City of Barrow, 230 P.3d 672, 681 (Alaska 2010) (quoting Witt v. 



State, Dep’t of Corr., 75 P.3d 1030, 1034 (Alaska 2003)). 



        27      21 P.3d 1282, 1286 (Alaska 2001). 



                                                  -15-                                            6765
 


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group   opposition   had   Lt.   Mills’s   affidavit   attached,   the   opposition’s   only   assertion 



supporting   Lt.   Mills’s   claim   is   the   broad   statement   that   “it   is   evident   that   there   is 



substantial evidence to support the allegations in the complaint, and that the defenses 



raised by the defendants are not adequate to defeat the claims as a matter of law.” 



                 Rule 56(e) provides that a party opposing summary judgment “may not rest 



upon the mere allegations or denials of the adverse party’s pleading,” but must “set forth 



facts showing that there is a genuine issue for trial.”              For this claim the facts were set 



forth   but   not   well   presented   to   the   superior   court   —   nonetheless,   because   there   is 



sufficient evidence to raise a genuine issue of material fact as to Lt. Mills’s wrongful 



termination claim, summary judgment is not appropriate. 



                 2.      Lt. Mills’s retaliation claim against the City 



                 We   affirm   the   superior   court’s   grant   of   summary   judgment   dismissing 



Lt. Mills’s claim against the City for retaliation against public policy for exercising his 



right   to   seek   public   employment.      The   superior   court   correctly   noted   that   Lt.   Mills 



“provid[ed]   no   authority   whatsoever   for   the   existence   of   the   tort   of   retaliation   for 



unsuccessfully applying for public employment.”  Lt. Mills attempts to substantiate the 



claim on appeal.   Lt. Mills argues that Chief Hankla retaliated against him for speaking 



out against Chief Hankla’s candidacy and competing for the position.                       Lt. Mills now 



asserts that the retaliation was a violation of both the federal and state constitutions.  But 



Lt. Mills did not raise either theory before the superior court.                  We therefore do not 

address the merits of the constitutional arguments on appeal.28 



        28       “[T]he parties cannot . . . advance new theories or raise new issues in order 



to secure a reversal of the lower court’s determination.”              Williams v. City of Valdez, 603 

P.2d 483, 488 n.15 (Alaska 1979) (quoting 10 CHARLES ALAN WRIGHT & ARTHUR R. 

MILLER , FEDERAL PRACTICE AND PROCEDURE  § 2716, at 435-36 (1973 & 1978 Supp.)). 



                                                    -16-                                                 6765 


----------------------- Page 17-----------------------

              3.     The dispatchers’ sexual harassment claims against the City 



              Dispatchers Welsh, Mills, and McLaughlin challenge the superior court’s 



grant of summary judgment dismissing their sexual harassment claims against the City. 

They argue that the City can be liable under AS 18.20.220(a),29 a provision of what is 



referred to as the Alaska Human Rights Act (AHRA),30        for hostile work environment 



caused by sexual harassment. We apply our independent judgment to issues of statutory 

interpretation and application, which present questions of law.31     When interpreting a 



statute, we “look to the meaning of the language, the legislative history, and the purpose 



of the statute and adopt the rule of law   that is most persuasive in light of precedent, 

reason, and policy.”32 



                     a.     Welsh’s sexual harassment claim against the City 



              In granting summary judgment dismissing Welsh’s claim, the superior court 



concluded that the City could not be liable under the AHRA for Chief Hankla’s conduct. 



The court reasoned that an employer’s liability is limited to acts of supervisors, not 



coworkers, and that Chief Hankla was not Welsh’s supervisor during the alleged acts of 



sexual harassment.  Although we agree that the law limits employer liability to the acts 



of supervisors, we disagree with the court’s determination that there was no genuine 



       29     AS 18.80.220(a) (“[I]t is unlawful for an employer . . . to discriminate 



against a person . . . because of the person’s age, physical or mental disability, sex, 

marital status, changes in marital status, pregnancy, or parenthood . . . .”). 



       30     See, e.g., Parson v. State, Dep’t of Revenue, Alaska Hous. Fin. Corp. , 189 



P.3d 1032, 1036 (Alaska 2008) (referring to AS 18.80.010-.300 as the Alaska Human 

Rights Act). 



       31     Mat-Su Valley Med. Ctr., LLC v. Advanced Pain Ctrs. of Alaska, Inc. , 218 



P.3d 698, 700 (Alaska 2009) (citing State v. Jeffery, 170 P.3d 226, 229 (Alaska 2007)). 



       32     Id. at 700-01 (quoting Enders v. Parker , 66 P.3d 11, 13-14 (Alaska 2003)). 



                                            -17-                                      6765
 


----------------------- Page 18-----------------------

issue of material fact regarding Chief Hankla’s status as a supervisor.                  We therefore 



reverse the summary judgment dismissal of Welsh’s AHRA claim against the City. 



                An employee must establish two elements to hold an employer liable for 



a hostile work environment:          (1) the employee experienced “discriminatory behavior 

sufficiently severe or pervasive to alter the conditions of the victim’s employment”;33 and 



(2) the discriminatory conduct can be imputed to the employer.34                The employer’s duty 



to   prevent    sexual   harassment     depends     on  the   relationship    between    the   harassing 



employee and the victim — an employer can be vicariously liable either for harassment 

by the victim’s supervisor or for failing to remedy known harassment by coworkers.35 



                The City does not dispute that a genuine issue of material fact exists with 



respect to the discriminatory nature of Chief Hankla’s behavior.                  The City contends, 



however,   that   Chief   Hankla   was   never   Welsh’s   supervisor   when   the   objectionable 



behavior   occurred.      According   to   the   City,   then-patrol-officer   Hankla   was   merely 



Welsh’s   coworker,   and   the   single   incident   of   harassment   while   he   was   police   chief 



occurred when Welsh was no longer an employee.  There are genuine issues of material 



fact as to both propositions. 



                In VECO, Inc. v. Rosebrock we concluded that an individual with the power 



to   fire,  discipline,  sanction,    and   affect  the  terms   or   conditions    of  an  employee’s 

employment was a supervisor.36          But we have had little opportunity to consider the outer 



limits of what constitutes a supervisory role. We look to similar federal cases under Title 



        33      French v. Jadon, Inc., 911 P.2d 20, 28 (Alaska 1996). 



        34       VECO, Inc. v. Rosebrock, 970 P.2d 906, 916-17 (Alaska 1999). 



        35      See id. at 915. 



        36      Id. at 916-17. 



                                                  -18-                                             6765
 


----------------------- Page 19-----------------------

VII of the Civil Rights Act of 1964 for guidance.37               These cases fall into two camps: 



those following the narrow view that a supervisor is one who has been entrusted with the 



actual authority to make tangible employment decisions, such as the authority “to hire, 

fire,   demote,   promote,   transfer,   or   discipline   an   employee”;38    and   those   following   a 



broader   view   that   includes   one   with   “authority   to   direct   the   employee’s   daily   work 

activities”39 and encompasses liability for apparent authority where the victim mistakenly 



but reasonably believed the harassing employee was a supervisor.40 



                 We    find   the  broader    view    persuasive.     In  VECO  we        explained     that 



“vicarious   liability   may   .   .   .   be   imposed   based   on   apparent   authority   or   where   an 



employee       is  aided   in  accomplishing       a  tort  by  the   employee’s      position   with   the 

employer.”41     We echoed that “it is precisely because the supervisor is understood to be 



        37       See id. at 912-13 (citing Title VII of the Civil Rights Act of 1964, 42 U.S.C. 



§ 2000e-2(a)(1)); see also Ellison v. Plumbers & Steam Fitters Union Local 375 , 118 

P.3d 1070, 1074 (Alaska 2005) (citing Alaska State Comm’n for Human Rights v. Yellow 

Cab, 611 P.2d 487, 490 (Alaska 1980)). 



        38       See Parkins v. Civil Constructors of Ill., Inc., 163 F.3d 1027, 1034 (7th Cir. 



1998). 



        39       See  Mack   v.   Otis   Elevator   Co. ,   326   F.3d   116,   126-27   (2d   Cir.   2003) 



(rejecting narrow view applied by courts following Parkins) (quoting EEOC Employer 

Guidance on Vicarious Employer Liability for Unlawful Harassment by Supervisors, 8 

Fair Emp. Prac. Man. (BNA) 405:7654 (1999)). 



        40       See Burlington Indus., Inc. v. Ellerth, 524 U.S. 742, 759 (1998) (“If, in the 



unusual case, it is alleged there is a false impression that the actor was a supervisor, when 

he in fact was not, the victim’s mistaken conclusion must be a reasonable one.”); see also 

EEOC, supra note 39 at 405:7655 (“[A]n employer may be subject to vicarious liability 

for harassment by a supervisor who does not have actual authority over the employee . 

. . if the employee reasonably believed that the harasser had such power.”). 



        41       VECO, 970 P.2d at 911 & n.8 (citing RESTATEMENT (SECOND) OF AGENCY 



                                                                                           (continued...) 



                                                   -19-                                              6765
 


----------------------- Page 20-----------------------

clothed with the employer’s authority that [the supervisor] is able to impose unwelcome 

sexual conduct on subordinates.”42       Thus, we focus on whether the employer enabled the 



harassing employee to hold himself or herself out as having authority over the victim. 



When an employer has clothed an employee with the appearance of authority, it has 



facilitated that employee’s harassing behavior and may be held vicariously liable. 



                For example, the Second Circuit applied this broader view in Mack v. Otis 

Elevator Co.43    There the allegedly harassing employee was titled “mechanic in charge” 



and had authority to “assign and schedule work, direct the work force, assure the quality 

and efficiency of the assignment, and . . . enforce the safety practice and procedures.”44 



Though the employee did not have the marks of actual authority necessary under the 



narrower view, the Second Circuit held that the employee was a supervisor because the 



employee “direct[ed] the particulars of each of [the victim’s] work days, including [the 

victim’s] work assignment, [and was] the senior employee on the work site.”45                  Those 



factors gave the employee “a special dominance over other on-site employees.”46                   The 



court explained that vicarious liability was not premised solely on whether the employee 



could take tangible employment actions impacting a subordinate, but on “whether the 



        41      (...continued) 



§ 219(2)(d) (1957)); see also Burlington Indus., Inc., 524 U.S. at 760, 763-65 (analyzing 

apparent authority and aided in agency theories in context of hostile environment claim). 



        42       VECO, 970 P.2d at 913 (quoting Meritor Sav. Bank, FSB v. Vinson , 477 



U.S. 57, 76-77 (1986) (Marshall, J., concurring)). 



        43      326 F.3d at 125-28. 



        44      Id . at 120. 



        45      Id . at 125. 



        46      Id. 



                                                 -20-                                           6765
 


----------------------- Page 21-----------------------

authority given by the employer to the employee enabled or materially augmented the 

ability of the latter to create a hostile work environment for his or her subordinates.”47 



                Here, there is a genuine issue of material fact whether Chief Hankla had 



that dominance when he was a patrol officer.             Though as a patrol officer Hankla could 



not unilaterally hire, fire, promote, or discipline Welsh, Welsh presented two pieces of 



evidence demonstrating that she reasonably believed he had the authority to materially 



affect her employment.  First, Welsh stated the former police chief solicited input from 



the patrol officers for Welsh’s performance evaluations and as a patrol officer Hankla 



could have given Welsh a negative review, possibly impacting her employment.  When 



an individual’s recommendation is given substantial weight, that individual has some of 

the marks of a supervisor.48        Second, Welsh stated dispatchers were trained “that all 



officers    were   considered     [their]  supervisors.”     While     the   City  is  correct   that  an 



employee’s unreasonable subjective belief about a coworker’s authority would not defeat 



summary judgment, the City has not established as a matter of law that Welsh’s belief 



was unreasonable. 



                There   also   is   a   genuine   issue   of   material   fact   whether   Welsh   was   still 



employed by the City when Chief Hankla asked to see her breasts while he was acting 



as police chief.  It is unclear from Welsh’s affidavit whether she actually had ended her 



employment   with   the   City   before   Chief   Hankla   made   his   remark   —   her   statements 



indicate she entered Chief Hankla’s office “as [her] shift ended” to have Chief Hankla 



sign her timecard. Drawing all reasonable inferences in Welsh’s favor, there is a genuine 



issue of material fact whether getting Chief Hankla’s signature on her time card at the 



end of her final work day was part of her duties as an employee. 



        47      Id . at 126. 



        48      See EEOC, supra note 39. 



                                                  -21-                                               6765 


----------------------- Page 22-----------------------

                        b.	     Mills’s     and   McLaughlin’s        sexual    harassment       claims 

                                against the City 



                We next consider whether the superior court erred in granting summary 



judgment dismissing Mills’s and McLaughlin’s sexual harassment claims.                     While it is 



undisputed   that   Chief   Hankla   was   their   supervisor   when   the   alleged   objectionable 



behavior occurred, the City argues that Chief Hankla’s behavior did not create a hostile 



work   environment.       In French v. Jadon, Inc. we held that “discriminatory behavior 



sufficiently severe or pervasive to alter the conditions of the victim’s employment and 

to   create   a   discriminatory   hostile   work   environment   violates  AS   18.80.220.”49      We 



adopted the United States Supreme Court’s two-prong standard from Harris v. Forklift 

Systems, Inc. :50   “the challenged conduct must be severe or pervasive enough ‘to create 



an objectively hostile or abusive work environment — an environment that a reasonable 



person would find hostile or abusive,’ ” but “there is no violation ‘if the victim does not 



subjectively   perceive   the   environment   to   be   abusive’   because   the   conduct   ‘has   not 

actually altered the conditions of the victim’s employment.’ ”51 



                Although it is a close call, there is a genuine issue of material fact whether 



Chief Hankla’s behavior towards dispatchers Mills and McLaughlin created a hostile 



work environment. Both asserted they witnessed and were victims of inappropriate jokes 



and   overtly   sexual   statements.    McLaughlin   stated   that   after   Chief   Hankla   saw   her 



accidentally open an email at work containing pictures of topless women, he told her “if 



[she] wanted to [she] could take some pictures of [her]self topless and send them to his 



email.” McLaughlin also claimed that when she arrived late for a party at Chief Hankla’s 



        49      911 P.2d 20, 28 (Alaska 1996). 



        50      510 U.S. 17, 21-22 (1993). 



        51      French , 911 P.2d at 28-29 (quoting Harris , 510 U.S. at 21-22). 



                                                  -22­                                              6765 


----------------------- Page 23-----------------------

house, she apologized, stating that she had come directly from the shower, to which he 



replied, “If you’re naked, come on in.”  Mills alleged she overheard Chief Hankla make 



several inappropriate sexual jokes about the dispatchers, such as that he was planning to 



purchase new dispatcher uniforms from Victoria’s Secret and that he had looked towards 



another dispatcher’s house while responding to a nearby fire call hoping to “see her 



standing in her front window wearing something ‘small and see-through.’ ”                   Mills also 



claimed that on one occasion when Chief Hankla approached her from behind to get a 



stapler from her desk, he put his hand on her back.            Both dispatchers were aware that 



Chief Hankla emailed some members of the department “pornographic and off-color 



photos.”    From these assertions, a reasonable jury could conclude that Chief Hankla’s 



harassing behavior created a hostile work environment, and it was error to dismiss the 



claim on summary judgment. 



                Some      jurisdictions   have    precluded    vicarious    liability  for  supervisor 



harassment when the employer exercised reasonable care to prevent and promptly correct 



harassing     behavior    and   the  victim   unreasonably      failed  to  take   advantage    of   any 

preventive or corrective opportunities or to otherwise avoid harm.52             But even if we were 



to allow that defense, the City cannot establish that there is no genuine dispute whether 



it met these elements.       Mills stated that the employee handbook containing the City’s 



sexual harassment policy was not distributed to new employees. Further, even if the City 



had    a  policy    on   sexual   harassment,     Chief    Hankla’s     own    deposition    testimony 



demonstrates that the City provided insufficient training regarding the policy:                  Chief 



Hankla stated he had “been taught” that conduct does not constitute sexual harassment 



unless   the   victim   objects   and   the   conduct   continues.  We   therefore   do   not   need   to 



consider now whether to allow this defense to hostile work environment claims. 



        52      See, e.g., Burlington Indus., Inc. v. Ellerth , 524 U.S. 742, 765 (1998). 



                                                  -23-                                              6765 


----------------------- Page 24-----------------------

                4.      The dispatchers’ sexual harassment claims against Chief Hankla 



                Welsh,   Mills,   and   McLaughlin   challenge   the   superior   court’s   entry   of 



summary judgment dismissing their sexual harassment claims against Chief Hankla.  In 



their amended complaint the dispatchers alleged that Chief Hankla’s behavior created a 



hostile environment “constitut[ing] sexual harassment and discrimination, causing pain, 



humiliation,     suffering,   and   physical   and   emotional   loss    .   .   .   in  violation  of  [AS] 



18.80.220(a).”     The superior court read the complaint to allege only a claim under the 



AHRA.      Although the court concluded Chief Hankla could be liable under the AHRA 



for aiding and abetting hostile environment sexual discrimination by the City, the court 



ultimately dismissed the AHRA claims against the City, precluding aiding and abetting 



liability.  On appeal, the dispatchers argue that the AHRA allows a claim against the 



harassing employee and further argue that their claims survive on theories of public 



policy tort and intentional infliction of emotional distress. 



                        a.      Chief Hankla’s liability under the AHRA 



                The employees argue that AS 18.80.270 allows individual employees to be 



liable for hostile work environment sexual discrimination. We disagree. Subsection .270 



creates liability for persons who willfully engage in “an unlawful discriminatory practice 



prohibited by this chapter.”  The statute  prohibits “persons” from committing a variety 

of   acts,53  but  prohibits   employment       discrimination     only   when    committed     by   “an 



employer.”54     Subsection .300(5) defines an employer as “a person, including the state 



and a political subdivision of the state, who has one or more employees in the state.” 



Chief Hankla plainly does not meet this definition.   We will not read subsection .270 as 



        53      AS 18.80.270; AS 18.80.220(a)(6). 



        54      AS 18.80.220(a)(1). 



                                                 -24­                                               6765 


----------------------- Page 25-----------------------

providing   grounds   to   find   a   person   who   is   not   an   employer   liable   for   employment 



discrimination. 



                The statute also does not evince any intention to create employee liability 



for hostile work environment sexual harassment. Subsection .200 provides that “it is the 



policy of the state and the purpose of this chapter to eliminate and prevent discrimination 



in   employment.”      To   effectuate   this   purpose,   the   AHRA   prohibits   certain   forms   of 

discrimination       by   employers,     employment       agencies,    and   unions,55    and   prohibits 



individual discrimination in the form of printing, publishing, broadcasting, or otherwise 



circulating     material    that  impermissibly       discriminates     with   regard    to  prospective 

employment.56      In drafting the statute, the legislature contemplated personal liability for 



certain acts and employer liability for others.57         Had the legislature wanted to establish 



personal liability for sexually inappropriate workplace behavior, as alleged against Chief 



Hankla, the legislature could have done so.  Instead, the legislature left employees with 



common law remedies against harassing employees.                   We therefore affirm the entry of 



summary   judgment   dismissing   Welsh’s,   Mills’s,   and   McLaughlin’s   AHRA   claims 



against Chief Hankla. 



                We note too that an employee may not be liable under the AHRA for aiding 



and abetting an employer when the discriminating employee’s own conduct is what gives 



rise to the employer’s liability.  In Ellison v. Plumbers & Steam Fitters Union Local 375 , 



we explained that under AS 18.80.260 “aiding and abetting liability occurs when the 



actor ‘knows that the other’s conduct constitutes a breach of duty and gives substantial 



        55      See AS 18.80.220(a)(1)-(5). 



        56      See AS 18.80.220(a)(6). 



        57      Compare AS 18.80.220(a)(6), with AS 18.80.220(a)(1), (3)-(5). 



                                                   -25­                                               6765 


----------------------- Page 26-----------------------

assistance or encouragement to the other.’ ”58         We do not believe the legislature intended 



to   use   the   aiding   and   abetting   provision   to   hold   employees   directly   liable   for   their 



discrimination.      Given the otherwise clear terms of the statute, we will not assume that 



on the critically important issue of individual liability the legislature decided not to use 



similarly clear language. We decline to hold that the legislature “intended to accomplish 

a result so significant by a method so abstruse.”59 



                        b.       Chief Hankla’s common law liability 



                The dispatchers argue that even if Chief Hankla cannot be liable under the 



AHRA, he still can be liable for sexual harrassment under common law theories of public 



policy tort or intentional infliction of emotional distress.  But the record is not clear that 



the dispatchers raised these theories before the superior court. 



                The dispatchers did not expressly mention these theories in their amended 



complaint,      which     alleged   “sexual    harassment      and   discrimination,      causing    pain, 



humiliation,      suffering,    and   physical     and   emotional      loss  .  .  .  in  violation    of 



[AS] 18.80.220(a).”  The dispatchers only referenced the theories in their opposition to 



summary judgment to rebut an argument that the AHRA shields the harassing employee. 



The dispatchers asserted that harassing employees are not protected both because of the 



language of the AHRA and because “[s]exual harassment is a well-recognized common 



law   tort   .   .   .   [that]   may   take   the   form   of   a   common   law   claim   based   on   assault,   on 



intentional infliction of emotional distress, on interference with contract . . ., and as a 



public policy tort” (emphasis omitted).   But they did not argue that they relied on those 



theories in their claims against Chief Hankla.           Welsh expressly asserted an intentional 



        58       118 P.3d 1070, 1077 (Alaska 2005) (quoting RESTATEMENT (SECOND) OF 



TORTS § 876 (1979)). 



        59      Reno v. Baird , 957 P.2d 1333, 1342 (Cal. 1998). 



                                                  -26-                                                6765 


----------------------- Page 27-----------------------

infliction of emotional distress claim, but only at a status hearing three days before the 



scheduled trial date.  The superior court concluded that Welsh’s intentional infliction of 



emotional distress claim had not been pleaded and declined to allow trial to proceed on 



that claim. 



                We have explained that “as a general rule, appellate review is precluded 



where questions which appellants denominate as triable issues of fact were not presented 

to the [trial court].”60    Because it is not clear that the claims of public policy tort or 



intentional infliction of emotional distress were expressly before the superior court, and 



because the superior court did not rule on the   merits of these claims, we decline to 



consider the merits of the claims on appeal.            But because we are reversing summary 



judgment dismissing the dispatchers’ sexual harassment claims against the City, the 



dispatchers may move to amend their complaint to include their common law claims 

against Chief Hankla.61       Rule 15(a) “commands that leave [to amend] is to be freely 



granted when justice so requires.”62 



                5.      Employees’ negligent hiring claim against the City 



                The employees challenge the superior court’s entry of summary judgment 

dismissing their negligent hiring claim against the City.63          The superior court concluded 



        60      Williams   v.   City   of   Valdez,   603   P.2d   483,   488   (Alaska   1979)   (internal 



quotation marks omitted). 



        61      See J&S Servs., Inc. v. Tomter, 139 P.3d   544, 550 n.25 (Alaska 2006) 



(“Amendment to the pleadings may be proper on remand.” (citing Swift v. Kniffen, 706 

P.2d 296, 305 n.11 (Alaska 1985))). 



        62      Id. (citing  Prentzel v. State, Dep’t of Pub. Safety , 53 P.3d 587, 590-91 



(Alaska 2002)). 



        63      The employees also pleaded claims for negligent retention and training, but 



on appeal they do not challenge summary judgment on those claims. 



                                                 -27-                                            6765
 


----------------------- Page 28-----------------------

that the employees’ claim for negligent hiring is precluded by discretionary function 



official immunity under AS 09.65.070(d)(2). Because we agree the City is immune from 



liability for its hiring decision, we affirm the entry of summary judgment dismissing this 



claim. 



                Alaska Statute 09.65.070(d)(2) immunizes municipalities from civil liability 



for claims “based upon the exercise or performance or the failure to exercise or perform 



a discretionary function or duty by a municipality or its agents . . . whether or not the 



discretion involved is abused.”   We have explained that this statute “expresses a type of 

official immunity,” protecting municipalities from liability for discretionary actions.64 



We   have   defined   discretionary   actions   as   “those   that   require   personal   deliberation, 

decision and judgment,”65        and have contrasted them with ministerial acts “amounting 



only to obedience of orders, or the performance of a duty in which the officer is left with 

no choice of his [or her] own.”66       The discretionary function immunity expressed in this 



statute   is   qualified,   meaning   “a   public   official   is   shielded   from   liability   only   when 



discretionary acts within the scope of the official’s authority are done in good faith and 

are not malicious or corrupt.”67 



                The City’s decision appointing Chief Hankla was a discretionary action 



immunized by AS 09.65.070(d)(2).  The employees concede that “selecting a person for 



a   particular   municipal   post   involves   discretion.”     But   they   argue   that   investigating 



        64      Pauley v. Anchorage Sch. Dist. , 31 P.3d 1284, 1285 (Alaska 2001). 



        65      Id. (quoting Samaniego v. City of Kodiak, 2 P.3d 78, 83 (Alaska 2000)) 



(internal quotation marks omitted). 



        66      Aspen Exploration Corp. v. Sheffield , 739 P.2d 150, 155 (Alaska 1987) 



(quoting State v. Haley, 687 P.2d 305, 316 (Alaska 1984)) (internal quotation marks 

omitted). 



        67      Pauley , 31 P.3d at 1286 (quoting Aspen , 739 P.2d at 158). 



                                                  -28-                                             6765
 


----------------------- Page 29-----------------------

candidates before hiring — by, for example, conducting a background check — is such 



a “basic step[] that any responsible municipality would take before making a decision,” 



that   it  cannot   be   considered     a  discretionary     act.  We     do   not  find   the  distinction 



persuasive.      The     evaluation    of  potential    employees,      the  factors   relied   on  in  that 



evaluation, and the decision to hire a particular individual from an applicant pool all 

require the City to act with “deliberation, decision and judgment.”68   The City’s hiring 



determination   therefore   falls   within   the   protection   of   discretionary   function   official 



immunity. 

                 Although official immunity for discretionary functions is qualified,69 there 



is   no  factual   basis   to   suggest   the   hiring   determination   was   malicious,      corrupt,   or 



otherwise not conducted in good faith.            As the parties moving for summary judgment, 



Chief Hankla and the City had the initial burden of demonstrating there was no material 

issue of fact as to the City’s good faith motive.70          Though Chief Hankla and the City did 



not   directly   argue   the   question   of   good   faith,   they   did   challenge   the   merits   of   the 



negligent   hiring   claim.     They   argued   that   “the   record   clearly   documents   the   City’s 



commitment to act properly.”           Chief Hankla and the City point to the following:  (1) a 



newsletter from the City disclosing that the first appointment of Chief Hankla violated 



the city code and discussing the council’s decision to amend the code; (2) a report from 



the    city  administrator      recommending        the   council    “duly    consider     [Lt.]  Mills’[s] 



application and approve an appointment they feel is appropriate”; (3) minutes from a 



        68       Id. at 1285 (quoting Samaniego, 2 P.3d at 83). 



        69       Id. at 1286. 



        70       Kelly v. Municipality of Anchorage , 270 P.3d 801, 803 (Alaska 2012) (“The 



moving party has the initial burden of showing by admissible evidence that there is an 

absence of genuine factual disputes and that it is entitled to judgment as a matter of 

law.”). 



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council meeting indicating that “[t]here was discussion regarding the two candidates” 



before unanimously   voting   to   appoint Chief Hankla; (4) a letter, written after   Chief 



Hankla’s   appointment,   notifying   the   Alaska   Police   Standards   Council   that   the   City 



received information about Chief Hankla’s alleged arrest for battery in a different state; 



(5) correspondence with the City’s attorney regarding actions the City could take in 



response   to   concerns   about   Chief   Hankla   continuing   as   police   chief;   (6)   a   written 



reprimand Chief Hankla was given; and (7) City correspondence regarding suspending 



Chief Hankla.   This evidence indicates good faith deliberation prior to appointing Chief 



Hankla and responsiveness to problems that arose after his appointment. 



                 The employees had the burden of demonstrating the existence of a genuine 

issue of material fact on that question,71 but raised nothing more than suspicions.  The 



employees argued that in amending the city code to make Hankla eligible to be police 



chief,   the   City   was   “motivated   by   the   decision   to   have   a   new   chief   who   would   not 



enforce the   liquor laws vigorously and would not arrest Council members and their 



relatives.”    While this allegation may point to conduct that is not in good faith, the 



employees may not “rest upon mere allegations, but must set forth specific facts showing 

that there is a genuine issue of material fact.”72 



                 The employees supported their argument with affidavit testimony from 



Lt. Mills that he knew “for a fact that the council wanted Hankla as chief . . . so as to be 



easier on themselves.”  Lt. Mills asserted that he had arrested a council member, that he 



had   been   present   at   the   arrest   of   another,   and   that   the   department   arrested   several 



relatives of council members, while Chief Hankla “made only one arrest during his entire 



        71       See id. 



        72       Id.   (quoting   Cikan   v.   ARCO   Alaska,   Inc.,   125   P.3d   335,   339   (Alaska 



2005)). 



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time   in   Hoonah   and   generally   had   a   ‘get   along’   attitude   that   the   council   members 

preferred.”   We “do not weigh evidence or witness credibility on summary judgment,”73 



but for affidavit testimony to raise a genuine issue of material fact it must “be made on 



personal knowledge, . . . set forth facts as would be admissible in evidence, and . . . show 

affirmatively   that   the   affiant   is   competent   to   testify   to   the   matters   stated   therein.”74 



Lt.   Mills   may   have   had   personal   knowledge   of   the   number   of   arrests   Chief   Hankla 



conducted, but those facts are not indicative of the City’s motive for appointing him as 



police chief.    There is no indication Lt. Mills actually had personal knowledge that the 



city council appointed Chief Hankla   to   reduce arrests of council members and their 



families.    Because Lt. Mills’s assertion was not based on personal knowledge, it is not 



sufficient to raise a genuine issue   of material fact that the hiring determination was 

malicious, corrupt, or otherwise not in good faith.75                We affirm   the   superior court’s 



determination   that   the   City’s   hiring   decision   is   protected   by   discretionary   function 



official immunity. 



                 6.      Other claims 



                 The employees raise several theories on appeal that they did not clearly 



raise before the superior court, including breach of the covenant of good faith and fair 



dealing   as   to   dispatchers   Welsh,   Mills,   and   McLaughlin;   retaliation   as   to   Mills   and 



        73       Kelly , 270 P.3d at 804. 



        74       Alaska R. Civ. P. 56(e); see also Nat’l Indem. Co. v. Flesher, 469 P.2d 360, 



368 (Alaska 1970). 



        75       Cf. Kelly, 270 P.3d at 804 (concluding that injured party seeing workers in 



yellow vests in general area of accident is not personal knowledge to support assertion 

that municipal workers caused accident); French v. Jadon , 911 P.2d 20, 25-27 (Alaska 

1996) (concluding employee’s “unsupported suppositions” that she was fired for not 

dating manager’s brother or for not participating in “unethical and illegal” activities did 

not raise genuine issue of material fact of bad faith termination). 



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McLaughlin;       wrongful    constructive    termination    and   retaliation  as  to  Welsh;    and 



intentional infliction of emotional distress as to all the employees. 



                Because it is not clear from the record that these claims were raised before 



the superior court, and because the superior court did not rule on them, we decline to 



consider their merits.     And because we are reversing the entry of summary judgment 



denying other claims by the employees, we do not need to address the superior court’s 



decision to exclude what it considered to be unpleaded claims raised late in discovery. 



On remand the employees may file a motion with the superior court to amend their 

pleadings to include these claims.76 



        C.      Attorney’s Fees 



                Because   we   remand      several   claims   for   further   proceedings,   including 



possible     pleading    amendments      for  additional    claims,   prevailing    party   status  is 



undetermined and we vacate the superior court’s judgment awarding attorney’s fees 



against the employees.  We do not need to determine at this time whether Chief Hankla 

and the City’s offer of judgment was valid under Rule 68.77             We note, however, that it 



was error to impose an award of attorney’s fees jointly and severally. 



                In Hughes v. Foster Wheeler Co. we recognized that parties could be made 



jointly   and   severally   liable   where   “the same issue [is] involved   in   each   claim.”   In 



Hughes , 30 merchant mariners filed similar complaints against shipowners and asbestos 



        76      J&S Servs., Inc. v. Tomter , 139 P.3d 544, 550 n.25 (Alaska 2006) (citing 



Prentzel v. State, Dep’t of Pub. Safety , 53 P.3d 587, 590-91 (Alaska 2002); Swift v. 

Kniffen , 706 P.2d 296, 305 n.11 (Alaska 1985)). 



        77      See   Anderson   v.   Alyeska   Pipeline   Serv.   Co.,   234   P.3d   1282,   1288-90 



(Alaska 2010) (analyzing validity of nominal Rule 68 offer made at the outset of the case 

after affirming dismissal of lawsuit); see also Beal v. McGuire, 216 P.3d 1154, 1177-78 

(Alaska 2009) (reversing entry of Rule 68 attorney’s fees where offers were “effectively 

zero in what appear[ed] to be a good faith dispute”). 



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manufacturers alleging personal injury and wrongful death claims.78   These cases were 



consolidated for the “purposes of hearing [the defendants’] motion to dismiss on [the 

grounds of] forum non conveniens.”79          The superior court granted the motion to dismiss 



and held the merchant mariners jointly and severally liable for costs and attorney’s fees.80 



We affirmed because the claims all concerned the “same issue” of whether to dismiss 

under forum non conveniens.81 



                The same is not true here.      Of the eight counts in the amended complaint, 



only two counts applied to all four of the employees.             (The two counts are misuse of 



public property and negligent hiring, retention, and training. Only the negligent hiring 



count is at issue on appeal.) It was therefore error to hold the employees jointly and 



severally liable for fees.     If after remand the superior court awards attorney’s fees to 



Chief   Hankla   and   the   City,   it   should   make   findings   allocating   the   fees   among   the 



employees. 



V.      CONCLUSION 



                We REVERSE the summary judgment ruling dismissing Welsh’s, Mills’s, 



and McLaughlin’s hostile work environment sexual harassment claims against the City 



and dismissing Lt. Mills’s wrongful discharge claim against the City and REMAND for 



further proceedings.      We VACATE the judgment and its award of costs and attorney’s 



fees.  The superior court’s decision is otherwise AFFIRMED. 



        78      Id. at 786. 



        79      Id. 



        80      Id. 



        81      Id. at 792; see also Stepanov v. Gavrilovich , 594 P.2d 30, 36 (Alaska 1979) 



(upholding joint and several liability for attorney’s fee award because plaintiffs’ claims 

“concerned the same issue” where contractors sued subdivider for damage to homes due 

to undisclosed permafrost melting). 



                                                 -33-                                              6765 

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