Does a wrongfully discharged employee's rejection of a substitute job offer that differs in kind and is inferior to the original employment bar recovery of the full contract compensation for failure to mitigate damages?

Shirley MacLaine Parker (plaintiff), a well-known actress, contracted with Twentieth Century-Fox Film Corporation (defendant) in August 1965 to play the female lead in a musical production, "Bloomer Girl," for guaranteed compensation of $53,571.42 per week for 14 weeks beginning May 23, 1966, totaling $750,000. The film was to be shot in California, and the contract gave Parker approval rights over the director, the dance director, and the screenplay. Before May 1966, Fox decided not to produce the picture and notified Parker by letter dated April 4, 1966, that it would not comply with its contractual obligations. The same letter offered Parker the lead in a different film, "Big Country, Big Man," at identical compensation and with 31 of the 34 original contract articles unchanged. Unlike "Bloomer Girl," "Big Country" was a dramatic Western to be filmed in Australia. The offer also eliminated or impaired Parker's director and screenplay approval rights, replacing them with a promise of mere consultation. Parker was given one week to accept and did not, and the offer lapsed. Fox admitted the contract's validity, Parker's readiness to perform, and its own breach, and asserted only that Parker failed to mitigate damages by rejecting the substitute role.

Parker sued Fox in California trial court, alleging a first cause of action for money due under the contract and a second for damages from breach. Fox answered, admitting the contract and its breach but pleading as an affirmative defense Parker's failure to mitigate damages. Parker moved for summary judgment under Code of Civil Procedure section 437c. The trial court granted the motion and entered judgment for $750,000 plus interest. Fox appealed to the California Supreme Court, which affirmed.

(Burke, J.)

No. Rejection of the "Big Country" offer does not bar recovery because the substitute employment was both different in kind and inferior to the original employment, and Fox presented no triable issue of fact on that point.

A wrongfully discharged employee may recover the agreed salary for the contract period, less amounts the employer proves the employee earned or with reasonable effort could have earned from other employment. But before earnings from an unaccepted opportunity can be applied in mitigation, the employer must show the other employment was comparable or substantially similar to the employment lost. An employee need not seek or accept employment of a different or inferior kind. W.F. Boardman Co. v. Petch, 186 Cal. 476 (1921); Gonzales v. Internat. Assn. of Machinists, 213 Cal. App. 2d 817 (1963); de la Falaise v. Gaumont-British Picture Corp., 39 Cal. App. 2d 461 (1940). Reasonableness is not an element of the employee's right to reject different or inferior work.

"Bloomer Girl" was a California-based musical calling on Parker's talents as a dancer and actress, while "Big Country" was a straight dramatic Western filmed in an Australian opal mine setting. A dramatic lead in a Western cannot be considered equivalent to or substantially similar to the lead in a song-and-dance production, so the two jobs differ in kind.

The substitute offer also eliminated or impaired the director and screenplay approval rights granted in the original contract. Depriving an employee of rights held under the original contract makes the alternative employment inferior, without need for expert testimony or judicial notice.

Fox's affidavits asserting that the new role was not different or inferior merely repeated its pleadings and offered conclusory statements about undisputed facts, so they raised no triable issue. Summary judgment was therefore proper, and the Court did not reach Parker's alternative argument that she was excused from mitigating.

Dissent (Sullivan, J.) Whether the "Big Country" offer was substantially similar to the "Bloomer Girl" employment or was different or inferior is a factual question that cannot be resolved on summary judgment. The mitigation doctrine embodies fairness and requires reasonable conduct, and an employee must accept comparable work in the same field and of the same quality. The majority merely lists differences between the two films and asserts they constitute a difference in kind, which proves nothing; differences between jobs always exist, and the relevant inquiry is whether they are substantial enough to render the work different or inferior. The majority's per se rules, that any difference in the nature of the work or any elimination of a contract right makes substitute employment inferior, would effectively eliminate the duty to mitigate. The importance of the approval rights, which were qualified, was never shown by Parker's declarations, and the trial court improperly relied on judicial notice of industry practices without the notice and hearing required by Evidence Code section 455, although the majority answered that no expertise or judicial notice is needed to conclude that losing contract rights makes a substitute job inferior. The judgment should be reversed for trial.