from the Superior Court in Maricopa County No. CV2011-055776
The Honorable John R. Hannah, Jr. Judge
Manolio & Firestone, PLC, Scottsdale By Veronica L.
Manolio Counsel for Plaintiffs/Appellees
Pierce, Coleman, PLLC, Phoenix By Justin S. Pierce, Kylie
Crawford TenBrook Counsel for Defendant/Appellant
Presiding Judge Diane M. Johnsen delivered the opinion of the
Court, in which Judge Michael J. Brown and Judge Jennifer B.
A jury awarded damages to a former police detective who
alleged the City of Surprise constructively discharged her in
retaliation for reporting repeated instances of sexual
harassment. We hold that an employee who fails to exhaust
administrative remedies for an alleged constructive discharge
based on sex discrimination may not sue for retaliation under
the Employment Protection Act ("EPA"), Arizona
Revised Statutes ("A.R.S.") section
23-1501(A)(3)(c) (2018). Accordingly, we reverse the judgment.
AND PROCEDURAL BACKGROUND
The Surprise Police Department hired Alicia Peterson as a
patrol officer in April 2005 and later promoted her to
detective. At the time, Peterson served in the United States
Marine Corps Reserve. In June 2010, the department announced
testing for a vacant sergeant position. Because Peterson was
away on military reserve duty, she did not receive the
announcement until after the application deadline had passed.
The department allowed her to test for the position even
though she had missed the deadline to apply.
After testing, Peterson advanced to the next phase of the
promotion process, and later that summer, she was ranked
first among the candidates. On August 17, however, Peterson
gave notice she intended to resign. At a meeting with the
interim chief of police, Peterson repeated earlier complaints
she had raised with her supervisor that other members of the
department had repeatedly and persistently harassed her
during the promotion process. Peterson resigned effective
September 1. Citing "a negative environment" that
had caused Peterson to feel "ridiculed . . . undermined
and . . . subjected to personal attack by fellow
members" of the department, the interim chief closed the
promotion process without filling the position.
A year later, Peterson sued the City, alleging constructive
discharge and breach of contract. Peterson asserted she was
compelled to resign because the City failed to protect her
from intolerable discriminatory conduct based on her gender
and military status. She also asserted the City breached an
implied-in-fact contract by failing to comply with its
After discovery, the City moved for summary judgment. The
City did not dispute that the harassment Peterson alleged had
occurred, but argued it was not so bad that it amounted to
constructive discharge. The City argued that to the extent
Peterson's wrongful-termination claim was based on her
gender, it was barred by her failure to exhaust
administrative remedies under the Arizona Civil Rights Act,
A.R.S. §§ 41-1401 to -1493.04 (2018). The City also
denied it had any employment contract with Peterson.
In response, Peterson argued that exhaustion of
administrative remedies is required only for
"firsthand" violations of the Arizona Civil Rights
Act, and not for a whistleblower's retaliation claim
under § 23-1501(A)(3)(c)(ii). She also argued there was
a question of fact about whether the City's manual or
policies created an employment contract.
The court dismissed Peterson's contract claim but denied
the motion for summary judgment on her claim for retaliatory
constructive discharge. After a four-day trial, the jury
found in favor of Peterson and awarded her $375, 000 in
damages. The court denied the City's request for
attorney's fees on the contract claim and later denied
the City's motion for judgment as a matter of law or for
a new trial.
The City timely appealed. We have jurisdiction pursuant to
Article 6, Section 9, of the Arizona Constitution ...