Vaughan v. Jacobs & Jacobs

Filed 11/8/01
NOT TO BE PUBLISHED
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or
ordered published for purposes of rule 977.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SIX
LARRY VAUGHAN,
Plaintiff and Appellant,
v.
JACOBS & JACOBS,
Defendant and Respondent.
2d Civil No. B144394
(Super. Ct. No. CIV 191592)
(Ventura County)
Larry Vaughan appeals the dismissal of his action against former employer,
Jacobs & Jacobs (Jacobs). The dismissal followed summary adjudication of claims for
wrongful termination and disability discrimination in violation of the California Fair
Employment and Housing Act (FEHA), Government Code section 12900 et seq.,1 and
voluntary dismissal of the remaining breach of contract claim. Vaughan contends, among
other things, that the trial court erred in concluding that statements on his disability
application estop him from asserting that he was able to perform the essential functions of
his job with a reasonable accommodation for his disability. We reverse. Triable facts
exist on whether Vaughan established a prima facie case of disability discrimination and
whether Jacobs' reasons for terminating Vaughan were pretextual.
1 All statutory references are to the Government Code unless otherwise indicated.

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2.
FACTS AND PROCEDURAL HISTORY
Vaughan worked as an accountant for Jacobs, a small accounting firm, for
five months before he left during tax season on an unpaid medical leave. He had back
pains along with fatigue, slurred speech, sore muscles, and experienced difficulty
walking. He was diagnosed with multiple sclerosis (MS).2 Vaughan immediately began
a course of treatment that alleviated many of his symptoms. Toward the end of March
1999, Vaughan's doctor told him that he could return to work. On March 27, 1999,
Vaughan called Jacobs and told him that he was ready to come back to work. But
Vaughan did not return. Instead, another doctor certified that Vaughan would be unable
to work until April 30, 1999. To handle the extra work during tax season, Jacobs hired a
temporary accountant.
During April, Vaughan called Jacobs after tax season, three days before his
leave expired. During that conversation, Vaughan told Jacobs that he was ready to "come
back to work, try part time and work up to full time." Vaughan recalls that Jacobs told
him he would have to check with his partners. Jacobs never got back to Vaughan.
While on medical leave, Vaughan applied for and received monthly
disability benefits from the government. In his disability benefits application, Vaughan
declared that his condition prevented him from returning "to regular and customary
work." On the application, Vaughan's neurologist estimated June 1, 1999, as the date
when Vaughan could return to work.
On May 1, 1999, when Vaughan's medical leave expired, he did not return
to work. On May 12, 1999, Jacobs fired him.
2 MS is a slowly progressive, debilitating disease of the central nervous system.
"Typically, the symptoms . . . are weakness, incoordination, paresthesias, speech
disturbances, and visual complaints. The course of the disease is usually prolonged, so
that the term multiple also refers to remissions and relapses that occur over a period of
many years." (Dorland's Illustrated Medical Dict. (28th ed. 1994) pp. 1495-1496.)

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3.
Vaughan filed suit for disability discrimination (§ 12940, subd. (a)),3
wrongful termination in violation of public policy, and breach of contract. Jacobs moved
for summary adjudication of 20 specified issues.
The trial court chose one issue as the basis for its order granting summary
adjudication. It concluded that Vaughan was not a qualified individual with a disability
under FEHA and thus could not proceed with his FEHA or tort claim. It did so on two
grounds: (1) Vaughan's statements on his disability benefits application precluded
recovery on his FEHA claim, and (2) Vaughan's doctor had certified on that application
that Vaughan could not perform the essential functions of his job until June 1, 1999.
Thus, Vaughan was unable to perform his job with or without reasonable
accommodations on May 12, 1999, when he was terminated. We conclude the court
erred on both grounds.
DISCUSSION
Disability Discrimination
Where an employer moves for summary adjudication of a FEHA cause of
action, "the plaintiff bears the burden of establishing a prima facie case of discrimination
based upon physical disability . . . . [T]he burden then shifts to the employer to offer a
legitimate, nondiscriminatory reason for the adverse employment action. Once the
employer has done so the plaintiff must offer evidence that the employer's stated reason
is either false or pretextual, or evidence that the employer acted with discriminatory
animus, or evidence of each which would permit a reasonable trier of fact to conclude the
employer intentionally discriminated. [Citation.]" (Deschene v. Pinole Point Steel Co.
(1999) 76 Cal.App.4th 33, 44; see also Guz v. Bechtel Nat., Inc. (2000) 24 Cal.4th 317,
354-356.) We independently review the trial court's ruling on a summary adjudication
motion. (Romano v. Rockwell Internat., Inc. (1996) 14 Cal.4th 479, 487; see (Code Civ.
Proc., § 437c, subd. (f)(1).)
3 Section 12940, subdivision (a) makes it an unlawful employment practice for an
employer "because of the . . . physical disability . . . of any person, to discharge the
person from employment . . . ."

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4.
Prima Facie Case of Discrimination
To establish a prima facie case of disability discrimination, Vaughan must
prove that he (1) has a disability, (2) is qualified to perform the duties of the position with
or without reasonable accommodation, and (3) has suffered an adverse employment
action because of his disability. (Brundage v. Hahn (1997) 57 Cal.App.4th 228, 236.)
There is no dispute that Vaughan suffered an adverse employment action of termination,
but Jacobs contends that Vaughan cannot establish that he was disabled as defined in
FEHA, or that he was qualified to perform his job duties with or without reasonable
accommodation.
1. Disability under FEHA
Jacobs contends that Vaughan cannot establish that, at the time of his
termination, MS sufficiently limited a major life activity to qualify as a disability under
FEHA. We disagree. Evidence in the record reveals a disputed issue of material fact as
to whether Vaughan's ability to walk and work rendered him disabled under FEHA.4
Vaughan states in his declaration that he had difficulty walking and walks with a cane. It
is uncontroverted that Vaughan requested a reduced work schedule presumably because
he could not work full time and control his MS.
Intervening amendments and additions to FEHA have arguably altered the
standard by which we view whether Vaughan has a disability. The amendment to section
12926, subdivision (k) and the addition of section 12926.1 state that a substantial
4 When Vaughan was fired (and summary adjudication was granted), FEHA
defined "physical disability" as an actual or perceived "physiological disease, disorder,
condition, cosmetic disfigurement, or anatomical loss [that both] [a]ffects . . . the
neurological, immunological, musculoskeletal, special sense organs, respiratory,
including speech organs, cardiovascular, reproductive, digestive, genitourinary, hemic
and lymphatic, skin and endocrine [systems of the body and] [l]imits an individual's
ability to participate in major life activities." (Former § 12926, subd. (k), enacted by
Stats. 1992, ch. 913, § 21.3.) Major life activities include working and walking. (Cal.
Code Regs., tit. 2, § 7293.6, subd. (e)(1)(A)(2)(a).)

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5.
limitation is not required to demonstrate a limit on a major life activity.5 Whether or not
these changes to FEHA apply retroactively is now before our Supreme Court.
(Colmenares v. Braemar Country Club, Inc. (2001) 89 Cal.App.4th 778, review granted
Aug. 22, 2001, S098895 [amendment and addition not retroactive]; see contra Wittkopf v.
County of Los Angeles (2001) 90 Cal.App.4th 1205, review granted, Oct. 10, 2001,
S100231.) Assuming the legislation is retroactive, Vaughan has presented sufficient
evidence of a triable issue.
2. Qualified Individual with a Disability
Jacobs contends that Vaughan cannot establish that he was qualified to
perform his job duties with or without reasonable accommodation. Jacobs argues, and
the trial court agreed, that Vaughan's disability claim for the purpose of obtaining
disability benefits constitutes a judicial estoppel. Jacobs argues that Vaughan's statement
on his disability application, that he could not perform his regular or customary work, is
inconsistent with his litigation position that he is capable of performing his job with
reasonable accommodations. (Prilliman v. United Air Lines, Inc. (1997) 53 Cal.App.4th
935, 956-960 (Prilliman); see also Bell v. Wells Fargo Bank, N.A. (1998) 62 Cal.App.4th
1382, 1387 (Bell).) We disagree.
Judicial estoppel is invoked "only in situations where the litigant has taken
positions so clearly inconsistent that one necessarily excludes another. [Citation.]" (Bell,
supra, 62 Cal.App.4th at p. 1386.) Although Jacobs recognizes that the doctrine did not
preclude the FEHA claim by the employees in either Prilliman or Bell, the authorities
Jacobs relies upon here, it contends those cases are factually different. We are not
persuaded.
5 Section 12926.1, subdivision (c), provides in part: "[T]he Legislature has
determined that the definition[] of 'physical disability' . . . under the law of this state
require[s] a 'limitation' upon a major life activity, but do[es] not require, as does the
American with Disabilities Act of 1990, a 'substantial limitation.' This distinction is
intended to result in broader coverage under the law of this state than under that federal
act."

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6.
Both Prilliman and Bell involved equivocal statements on disability
applications. In Prilliman, an airline pilot's disability application stated he was grounded,
a reason not inconsistent with his litigation position that his employer failed to reasonably
accommodate him by not informing him of suitable job opportunities. (Prilliman, supra,
53 Cal.App.4th at pp. 962-963.) In Bell, the applicant stated that he could not perform
his "regular work" but also indicated that he anticipated returning to his previous job but
had requested accommodation. (Bell, supra, 62 Cal.App.4th at pp. 1387-1388.)
Here, just as in Prilliman and Bell, Vaughan's response to a question asking
him why he could not perform his regular and customary duties was equivocal. The
statement alone does not tell us what Vaughan considered his regular and customary
work. If Vaughan was referring to his job prior to medical leave, then the position he
takes in this litigation is not inconsistent. Vaughan maintains he was capable of
performing his regular job but with reasonable accommodations in his work schedule.
This raises an issue of fact. (Bell, supra, 62 Cal.App.4th at p. 1389.)
The trial court also erred in emphasizing that Vaughan's doctor certified
that Vaughan was disabled until the end of his initial medical leave on June 1, 1999.
FEHA requires that Vaughan be able to perform the essential functions of his job with or
without reasonable accommodations. An extension of an unpaid medical leave is a
reasonable accommodation, provided it does not pose an undue hardship. (Nunes v. Wal-
Mart Stores, Inc. (9th Cir. 1999) 164 F.3d 1243, 1247.) If Vaughan's medical leave was
a reasonable accommodation, then his inability to work during an extended leave period
would not automatically render him unqualified.
Moreover, Vaughan offered his own declaration testimony that he "would
have [worked] part-time, and then full time, had [he] not been fired." The trial court
erred by striking this testimony as lacking foundation. Declarations and affidavits "shall
be made . . . on personal knowledge, shall set forth admissible evidence, and shall show
affirmatively that the affiant is competent to testify to the matters stated [therein]." (Code
Civ. Proc., § 437c, subd. (d).) Vaughan is competent to testify regarding the effect his

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7.
disability had on his ability to perform job duties at the time. (Liberty Mut. Ins. Co. v.
Industrial Acc. Commission (1948) 33 Cal.2d 89, 96-97.)
Jacobs asks that we uphold the summary adjudication on the alternative
grounds that (1) Vaughan is not disabled, (2) Jacobs did not fail to reasonably
accommodate him, and (3) Jacobs has proffered legitimate reasons for Vaughan's
termination that have not been rebutted by competent evidence.6 We consider these
alternative grounds and conclude that they do not support Jacobs' position.
Reasonable Accommodation
Under FEHA, employers must make reasonable accommodations to the
disability of an individual unless the employer can demonstrate that doing so would
impose an "undue hardship." (Prilliman, supra, 53 Cal.App.4th at p. 947; Cal. Code
Regs., tit. 2, § 7293.9.) Reasonable accommodations include part-time or modified work
schedules. (Cal. Code Regs., tit. 2, § 7293.9, subd. (a)(2).) Jacobs urges us to affirm
because it made a reasonable accommodation for Vaughan (medical leave) and it was
Vaughan's inaction during April that caused a breakdown in the interactive process of
determining a reasonable accommodation. We are not persuaded.
Citing Hanson v. Lucky Stores, Inc. (1999) 74 Cal.App.4th 215, 226, Jacobs
argues that Vaughan's medical leave was a reasonable accommodation and that it was not
required to indefinitely extend it before replacing him. We agree. But we cannot
overlook the fact that Vaughan did not request an additional period of leave or ask for an
extended one. Instead, he requested a modified work schedule.
We also reject Jacobs' contention that Vaughan was responsible for the
breakdown in communication. As stated in Prilliman, supra, 53 Cal.App.4th at p. 950,
once an employee has given the employer notice of a disability, "'[t]his notice
triggers . . .the employer's burden to take 'positive steps' to accommodate the employee's
limitations. . . . Reasonable accommodations thus envisions an exchange between
6 The trial court rejected the latter two arguments in denying Jacobs' motion for
summary adjudication on Vaughan's tort claim. Inexplicably, it did not address those
issues on Vaughan's FEHA claim.

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8.
employer and employee where each seeks and shares information to achieve the best
match between the employee's capabilities and available positions.' [Citation.]" (See
also Spitzer v. The Good Guys, Inc. (2000) 80 Cal.App.4th 1376, 1385.) In Jensen v.
Wells Fargo Bank (2000) 85 Cal.App.4th 245, 262-263, the court concluded that in order
for the employer to prevail on a failure to accommodate claim, the employer must show it
did "everything in its power to find a reasonable accommodation, but the informal
interactive process broke down because the employee failed to engage in discussions in
good faith."
Vaughan creates a factual dispute on this issue by testifying that he asked
for a modified work schedule. It is uncontroverted that there was no further
communication between Jacobs and Vaughan on this issue. Jacobs did not accept, reject
or propose an alternative accommodation.
Reason for Termination
As an additional basis for its motion, Jacobs proceeded to the next step in
the burden-shifting test by producing substantial evidence of reasons, unrelated to
Vaughan's disability, why it fired Vaughan. (Code Civ. Proc., § 437c, subd. (o)(2); Guz
v. Bechtel Nat., Inc., supra, 24 Cal.4th at p. 357.) According to Jacobs, Vaughan was
fired because customers complained about him and he had excessive write-offs of billable
hours; he failed to return to work at the end of his medical leave; and he failed to
communicate with Jacobs regarding his intention to return to work so Jacobs hired his
replacement and when it did so, had to fire Vaughan because it could not support three
accountants in its Ojai office.
Notwithstanding Jacobs' rebuttal evidence, Vaughan could still prevail if he
produced evidence establishing a prima facie case plus sufficient additional evidence
from which a reasonable fact finder could reject "the employer's asserted justification [as]
false." (Reeves v. Sanderson Plumbing Products, Inc. (2000) 530 U.S. 133, 148.)
Vaughan has met his burden and presented evidence in both categories.
As discussed, Vaughan offered evidence comprising a prima facie case of
disability discrimination. In addition, he presented this evidence: (1) Jacobs never

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9.
complained about his work nor did he receive complaints from any clients before he was
fired; (2) Jacobs does not dispute that Vaughan called on April 27, 1999, three days
before his medical leave expired, and told Jacobs he was ready to return to work but
received no response to his request for a modified work schedule; (3) Jacobs did not
comply with its own policy of allowing up to four months of unpaid medical leave as
Vaughan had been on medical leave for less than two months when he was fired;
(4) Jacobs did not establish that Vaughan accepted other employment during his
disability period; and (5) Jacobs began considering whether to permanently hire the
accountant who replaced Vaughan "shortly after April 15th," almost two weeks before
Vaughan's medical leave had expired and following tax season when its business slowed
down. From the additional evidence, a trier of fact could reasonably reject as false
Jacobs' asserted business justifications for Vaughan's termination. Thus, having raised an
issue of fact in dispute, the trial court erred in granting summary adjudication.
Wrongful Discharge in Violation of Public Policy
Since disability discrimination can form the basis of a common law
wrongful discharge claim, the trial court erred in dismissing Vaughan's tort claim. (City
of Moorpark v. Superior Court (1998) 18 Cal.4th 1143, 1161.) Although Jacobs sought
adjudication that Vaughan was not entitled to punitive damages, the court made no
separate findings limiting Vaughan's damages. Thus, Vaughan's claim for punitive
damages as alleged in this cause of action also is reinstated.
Attorneys' Fees
In light of this ruling, the trial court's award of fees to Jacobs as the
prevailing party must be reversed. We note that a prevailing defendant is entitled to fees
and costs "upon a finding that the plaintiff's action was frivolous, unreasonable, or
without foundation, even though not brought in subjective bad faith." (Cummings v.
Benco Building Services (1992) 11 Cal.App.4th 1383, 1387, citing Christianburg
Garment Co. v. Equal Employment Opportunity Commission (1978) 434 U.S. 412, 421,
citing Carrion v. Yeshiva University (2d Cir. 1976) 535 F.2d 722, 727.) Here, there were

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10.
no such findings. The award could not be upheld without such findings, even if Jacobs
had prevailed in this appeal.
The judgment of dismissal is reversed. Vaughan is awarded attorneys'
fees and costs on appeal, in an amount to be determined on motion in the trial court.
(§ 12965, subd. (b); Cal. Rules of Court, rule 870.2(c)(1).)
NOT TO BE PUBLISHED.
PERREN, J.
We concur:
YEGAN, Acting P.J.
COFFEE, J.

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11.
Roland N. Purnell, Judge
Superior Court County of Ventura
______________________________
Lascher & Lascher, Gabriele Mezger-Lashly, Wendy C. Lascher;
Lowthorp, Richards, McMillan, Miller, Conway & Templeman and Alan Templeman for
Plaintiff and Appellant.
Anderson, Krehbiel, McCreary & Bryan, Michael E. McCreary and David
L. Krehbiel for Defendant and Respondent.

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