USCA1 Opinion
November 19, 1992
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
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No. 91-2296
JULIO A . MERCADO-GARCIA,
MARIA DEL CARMEN AVILA MUGICA,
AND THEIR MARITAL CONJUGALSHIP,
Plaintiffs, Appellants,
v.
PONCE FEDERAL BANK, ET AL.,
Defendants, Appellees.
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APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Raymond L. Acosta, U.S. District Judge]
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Before
Breyer, Chief Judge,
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O'Scannlain,* and Cyr, Circuit Judges.
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Pia Gallegos with whom Harry Anduze Montano was on brief for
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appellants.
Gregory T. Usera with whom Goldman Antonetti Ferraiuoli &
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Axtmayer was on brief for appellees.
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*Of the Ninth Circuit, sitting by designation.
O'SCANNLAIN, Circuit Judge: In this case involving
O'SCANNLAIN _____________
claims of age and employment discrimination we must resolve
several issues of first impression.
I
Julio Mercado-Garcia ("Mercado") was fifty years
old and had been in the employ of the Ponce Federal Bank
("the Bank") for eleven years when he was discharged from
his position as Vice President for Human Resources in 1988.
The final year of his tenure had not apparently been
pleasant. Mercado says that his problems began in November
1987 when he refused to accede to his supervisor's request
that he falsify certain personnel records. By his refusal
to act in a manner he believed to be illegal, Mercado
allegedly precipitated a campaign of harassment,
intimidation, and discrimination against himself.
Eventually Mercado was asked, and asked again, to
submit his resignation. When he refused, the Bank
terminated his employment. A letter from the Bank reached
Mercado on October 13, 1988, confirming his discharge
effective September 30, 1988. He alleges, however, that his
ill treatment at the hands of the Bank did not end there,
for the Bank, assertedly without cause, promptly cancelled
his VISA card and prematurely called a loan he had taken out
from the Bank. In addition, says Mercado, the Bank failed
to provide him timely notice of his rights to continue under
2
the Bank's health and life insurance policies, thereby
causing him to lose coverage.
Mercado filed his complaint in this case in July
1989 alleging violations of the Age Discrimination in
Employment Act, 29 U.S.C. 621-634 ("ADEA"), the Employee
Retirement Income Security Act, 29 U.S.C. 1001-1461
("ERISA"),1 the Equal Credit Opportunity Act, 15 U.S.C.
1691-1691f ("ECOA"), and the Consolidated Omnibus Budget
Reconciliation Act, 29 U.S.C. 1161-1168, ("COBRA"), as
well as a federal breach of contract claim2 and pendent
state law causes of action. In the district court, the Bank
prevailed on all claims, some by dismissal under Federal
Rule of Civil Procedure 12(b)(6) and others by grant of
summary judgment. Mercado timely appealed.
II
We turn first to Mercado's claim under the ECOA.
Section 701 thereof provides as follows:
(a) It shall be unlawful for any creditor to
discriminate against any applicant, with respect to
any aspect of a credit transaction --
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1 On appeal, Mercado has asserted no error in connection
with the district court's dismissal of his ERISA claim for
interference with retirement benefits in violation of 29
U.S.C. 1140. We therefore deem any such argument waived.
2 The district court had original jurisdiction over the
federal questions presented in this case pursuant to 28
U.S.C. 1331. See also 12 U.S.C. 632; 15 U.S.C.
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1691e(f); 29 U.S.C. 1132(e). This court has jurisdiction
over the final decision of the district court pursuant to 28
U.S.C. 1291.
3
(1) on the basis of race, color, religion,
national origin, sex or marital status, or age
(provided the applicant has the capacity to
contract) . . . .
15 U.S.C. 1691(a)(1). Mercado contends that summary
judgment was erroneously entered against him on his claims
under this section. Before reaching the merits of this
contention, we must first analyze how the commands of the
ECOA are to be applied, a matter we consider for the first
time.
It is apparent that the plain language of the
statute itself does not resolve a number of questions that
are fundamental to its enforcement by the courts. In
particular, the statute does not reveal what it is an ECOA
plaintiff like Mercado must establish in order to make out a
prima facie case of unlawful discrimination in a credit
decision and to withstand a creditor's motion for summary
judgment.
When faced with a matter of statutory construction
that is of first impression we have looked for guidance to
our construction of other, similar enactments. See De Jesus
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v. Banco Popular de Puerto Rico, 918 F.2d 232, 234 (1st Cir.
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1990) (looking to precedent regarding grant of attorney's
fees under 42 U.S.C. 1988 in interpreting "similar"
attorney's fees provisions of Truth in Lending Act). Doing
so in this instance, we find in the Equal Employment
Opportunity Act, 42 U.S.C. 2000e-2 ("EEOA"), an
4
appropriate model, and cases interpreting that statute
instructive. The EEOA seeks to prohibit discrimination in
the employment arena much as does the ECOA in the realm of
credit decisions. Indeed, the two statutes use nearly
identical language in seeking to achieve their purposes. We
therefore approve the district court's decision to follow
the lead of other circuits and analyze the ECOA as we have
analyzed the parallel provisions of the EEOA. See Bhandari
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v. First Nat'l Bank of Commerce, 808 F.2d 1082, 1100-01 (5th
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Cir. 1987) (language of ECOA is "closely related" to that of
EEOA and "was intended to be interpreted similarly");
Williams v. First Fed. Sav. & Loan Ass'n, 554 F. Supp. 447,
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448-49 (N.D.N.Y. 1981) ("protections afforded by the ECOA
should be applied in the same manner as those created by"
the EEOA), aff'd, 697 F.2d 302 (2d Cir. 1982).
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Applying the settled law regarding discrimination
in employment to Mercado's claim of age discrimination in
the Bank's credit decisions, it is apparent that Mercado
bore the burden of pleading a prima facie case of age
discrimination. See Texas Dep't of Community Affairs v.
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Burdine, 450 U.S. 248, 252-56 (1981); Olivera v. Nestle
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Puerto Rico, Inc., 922 F.2d 43, 46-47 (1st Cir. 1990).
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Assuming arguendo that he succeeded in doing so, the burden
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then shifted to the Bank "to articulate some legitimate,
nondiscriminatory reason" for the actions of which Mercado
complains. Burdine, 450 U.S. at 253.
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5
We think the Bank carried this burden. The Bank
explained that the cancelled VISA card was a special
employee credit card, to which Mercado was no longer
entitled after his termination. A new non-employee VISA
card was made available to Mercado just two weeks after
cancellation of the employee card. Similarly, the called
loan had been offered to Mercado on favorable terms, as a
special benefit incident to his employment by the Bank.
Mercado, the Bank argued, could not reasonably expect to
continue to be afforded the preferential treatment reserved
for Bank employees once he was one no longer. Furthermore,
it appears that Mercado had, upon learning that his
discharge was imminent, run up substantial checking account
overdrafts and withdrawn large amounts of cash through his
employee VISA card, suggesting that he might be a credit
risk.
The Bank having come forward with apparently
legitimate, nondiscriminatory reasons for its actions,
Mercado, in order to defeat the Bank's motion for summary
judgment, was required to offer evidence sufficient to
demonstrate by a preponderance that these reasons were in
reality a pretext for age discrimination. Id.; Olivera, 922
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F.2d at 47-48. This he was unable to do. Mercado failed to
plead any verifiable facts showing that the Bank's credit
decisions were based on his age. While he recited alleged
incidents of age discrimination by the Bank against himself
6
and others, he did not present any facts showing such
discrimination in the calling of his loan and the temporary
invalidation of his VISA card. Conclusory assertions or
mere allegations, in lieu of documented facts, cannot
withstand a summary judgment motion. Sheinkopf v. Stone,
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927 F.2d 1259, 1262 (1st Cir. 1991).
Mercado's showing raised no genuine issue as to
whether the Bank's articulated reasons for limiting his
credit were merely pretextual. The district court therefore
correctly granted summary judgment against Mercado on this
claim. See Ramos v. Roche Products, Inc., 936 F.2d 43, 47
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(1st Cir.) (where there is no direct evidence that unlawful
discrimination was a motivating factor in employer's
decision, defendant need only articulate a plausible
nondiscriminatory reason therefor to meet its burden in
showing the absence of discriminatory intent), cert. denied,
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112 S. Ct. 379 (1991); Villanueva v. Wellesley College, 930
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F.2d 124, 127-28 (1st Cir.) (plaintiff must introduce
evidence sufficient to raise a reasonable inference of
discriminatory intent to defeat summary judgment), cert.
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denied, 112 S. Ct. 181 (1991).
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III
Mercado next attempts to establish that the Bank
breached his loan agreement by calling his loan
7
prematurely.3 His task is complicated by the fact that
there is a written document evidencing the loan agreement --
a promissory note signed by Mercado -- that provides that
the loan is due on demand. In the district court, Mercado
sought to introduce parol evidence to show an oral agreement
that the loan term was in fact five years. The Bank,
perhaps contrary to its interest, responded by presenting
extrinsic evidence that the loan was for a one year term.
In any event, we are convinced that the demand note
is conclusive of this issue. The extrinsic evidence
presented by the parties is of no relevance because Puerto
Rico's parol evidence rule, P.R. Laws Ann. tit. 32, App. IV
R. 69 (1983), requires us to ignore such evidence "when the
agreement . . . is clear and unambiguous." Catullo v.
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Metzner, 834 F.2d 1075, 1079 (1st Cir. 1987). Rule 69(B)
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reads in pertinent part:
When in an oral or written agreement . . .
all the terms and conditions constituting
the true and final intention of the parties
have been included, such agreement shall be
deemed as complete, and therefore, there
can be between the parties . . . no
evidence extrinsic to the contents of the
same, except in the following cases:
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3 Civil claims involving a United States corporation that
arise out of a banking transaction in a dependent or insular
possession of the United States are placed within the
original jurisdiction of the district courts by 12 U.S.C.
632. Puerto Rico is a dependent possession for purposes of
this statute. Conjugal Soc'y Composed of Juvenal Rosa v.
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Chicago Title Ins. Co., 646 F.2d 688, 689 (1st Cir. 1981)
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(per curiam).
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(1) Where a mistake or imperfection of
the agreement is put in issue by the
pleadings;
(2) Where the validity of the
agreement is the fact in dispute.
This rule does not exclude other evidence
of the circumstances under which the
agreement was made or to which is related
such as the situation of the subject matter
of the instrument or that of the parties,
or to establish illegality or fraud.
P.R. Laws Ann. tit. 32, App. IV R. 69(B).
Mercado does not allege in his pleadings that the
demand note contained any mistakes or imperfections, and he
admits signing the note. He argues, however, that his
proffered evidence as to the actual term of the note
constitutes "other evidence of the circumstances under which
the agreement was made," and is, as such, admissible. We do
not agree. Consideration of "other evidence" is neither
necessary nor permissible if it is offered to contradict a
clear term of a written agreement. In this case, as to the
term of the loan, the promissory note can "be understood in
one sense alone, without leaving any room for doubt,
controversies or difference of interpretation, . . . without
necessitating for [its] understanding any reasoning or
illustration susceptible to challenge." Catullo, 834 F.2d at
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1079 (quoting Heirs of Ramirez v. Superior Court, 81 P.R.R.
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347, 351 (1959)). We are therefore bound to look no further
than the note itself. Its repayment provisions could hardly
be clearer or less ambiguous: the loan is due upon the demand
9
of the Bank. The plain terms of the parties' written
agreement cannot be contradicted with parol evidence. The
district court thus properly entered summary judgment for the
Bank on this issue, since the agreement itself was conclusive
as to all material questions of fact.
IV
Mercado contends that the district court erred in
granting summary judgment against him on his COBRA claim.
Under the COBRA amendments to ERISA, a plan participant or
beneficiary must, on leaving his employer, be advised by the
plan administrator that he may continue his ERISA health and
life insurance coverage if he is willing to assume the
payments. 29 U.S.C. 1166. Mercado alleged that the Bank
failed to inform him timely of his right to elect to continue
his benefits and that because of this failure he missed the
deadline for electing continued insurance coverage.
The district court correctly found that Mercado
raised no genuine issue of fact as to whether the Bank had
caused his failure to make the necessary election. The Bank,
as the ERISA plan administrator, asserted that it notified
Mercado on two separate occasions of his election rights. The
first notice was sent by first class mail within fourteen days
of Mercado's termination in compliance with 29 U.S.C.
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1166(c). Mercado denies ever receiving the letter.4 In any
case, after Mercado complained to the Bank, the Bank sent him
the relevant forms and a copy of its earlier letter by
certified mail. Mercado admits that he received this letter.
Under COBRA, Mercado had sixty days from the date he
received the notice conveyed by this certified letter to elect
continued insurance coverage. 29 U.S.C. 1165(1)(C)(ii).
See Communications Workers of America, Dist. One, AFL-CIO v.
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NYNEX Corp., 898 F.2d 887, 888-89 (2d Cir. 1990). Mercado
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admits failing to make the necessary election within this time
period, and does not explain how the Bank's conduct prevented
him from doing so. The Bank was therefore properly granted
summary judgment on this claim.
V
Finally, Mercado asserts that the district court
erred in dismissing his ADEA claim.
A statutory prerequisite to a civil action alleging
age discrimination in employment is the filing of a timely
complaint with the Equal Employment Opportunity Commission
("EEOC"). 29 U.S.C. 626(d). A charge of unlawful
discrimination must be filed with the EEOC within 300 days of
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4 Because we decide this issue on other grounds, we need
not address the widely accepted presumption that Mercado
would have received the properly addressed, stamped, and
mailed letter in a timely fashion. See, e.g., Federal Ins.
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Co. v. Summers, 403 F.2d 971, 975 (1st Cir. 1968) (applying
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Massachusetts law).
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the allegedly discriminatory act in states that have enacted
employment discrimination laws, and within 180 days in states
having no such laws. 29 U.S.C. 626(d)(1) & (2), 633(b).
See Kale v. Combined Ins. Co., 861 F.2d 746, 750 (1st Cir.
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1988). While Puerto Rico appears to have laws of the required
type, we do not here decide whether for purposes of 29 U.S.C.
633(b) Puerto Rico is a "state" such that the 300-day
limitations period applies. In this case, whichever deadline
controls, Mercado failed to file a timely complaint. Mercado
was terminated no later than October 13, 1988, the date he
received the Bank's letter confirming his discharge. He did
not file a claim with the Puerto Rico Anti-Discrimination Unit
and the EEOC until November 8, 1989, well beyond the maximum
limitations period on ADEA claims.
Mercado nonetheless argues that equitable estoppel
or equitable tolling should save his claim. We are not
persuaded. "Equitable estoppel occurs where an employee is
aware of his ADEA rights but does not make a timely filing due
to his reasonable reliance on his employer's misleading or
confusing conduct." Kale, 861 F.2d at 752. Mercado suggests
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that the Bank's offer to consider settlement, or its alleged
requests that he refrain from filing an age discrimination
complaint, constituted misleading conduct that adequately
excuses his failure to meet the statutory deadlines. We are
constrained to believe, however, that it is something less
than "reasonable" for a party contemplating litigation to
12
allow itself to miss filing deadlines in "reliance" upon such
cajolery from the opposing party. See Dillman v. Combustion
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Eng'g, Inc., 784 F.2d 57, 61 (2d Cir. 1986) (employer must
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misrepresent the limitations period or lull the plaintiff into
believing commencing litigation is not necessary); Naton v.
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Bank of California, 649 F.2d 691, 696 (9th Cir. 1981)
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(defendant must have improper purpose or actual knowledge of
its deceptive conduct before estoppel will toll time
limitations).
"Equitable tolling . . . casts a wider net." Kale,
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861 F.2d at 752. Tolling is appropriate where a plaintiff is
"excusably ignorant" of his rights. Ignorance of an ADEA
filing deadline may be "excusable" where it "is caused either
by misconduct of an employer or by failure of that employer to
conspicuously post the informational EEOC notices required by
the ADEA . . . ." Id.; see Torres v. Superintendent of Police
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of Puerto Rico, 893 F.2d 404, 407-08 (1st Cir. 1990). Even
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then, however, tolling ends once "the employee receives actual
notice of his statutory rights or retains an attorney." Kale,
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861 F.2d at 752.
Here, Mercado had actual knowledge of his right to
file with the EEOC during the entire period in which filing
might have been sufficient to permit a later ADEA action. In
his position as human resources manager, he himself had
counseled the Bank in matters relating to age discrimination.
13
In addition, he was represented by counsel from November 1988
on regarding this very suit.
We are satisfied that neither equitable tolling nor
equitable estoppel is implicated on these facts. The district
court therefore correctly dismissed Mercado's ADEA claim.5
VI
Once the court dismissed some of the federal claims
and resolved the others before trial by summary judgment, it
had the discretion also to dismiss the pendent state claims.
28 U.S.C. 1367(c)(3). Mercado's arguments to the contrary
are without merit.
Affirmed.
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5 Mercado further argues that the district court erred in
disposing of his claimed entitlement to equitable tolling or
estoppel under Federal Rule of Civil Procedure 12(b)(6).
According to Mercado, the court considered evidence outside
the pleadings, and thus should have treated the Bank's motion
to dismiss as a motion for summary judgment. We affirm the
district court's dismissal because Mercado wholly failed to
plead facts showing actively misleading or deceptive conduct
by the Bank that might permit him to rely on equitable
tolling or estoppel. A fortiori, Mercado failed "to make a
showing sufficient to establish the existence" of facts
entitling him to relief under either of these doctrines, so
that summary judgment would have been granted against him in
any case. Celotex Corp. v. Catrett, 477 U.S. 317, 322
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(1986).
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