      Notice: This opinion is subject to correction before publication in the P ACIFIC R EPORTER .
      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
      corrections@appellate.courts.state.ak.us.



               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.                                           )
                                                   )    OPINION
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 Appellees.

              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
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.
                     2.      Chief Hankla and Lt. Mills
              Following Chief Hankla’s second appointment, relations between Chief

                                            -2-                                      6765

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



                                           -3-                                     6765

                     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

       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

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

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
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
that the Alaska Wage and Hour Act3 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...)

                                             -8-                                         6765

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
              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

             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 novo 8 to “determine whether



      8
            Yost v. State, Div. of Corps., Bus. & Prof’l Licensing, 234 P.3d 1264, 1272
(Alaska 2010).

                                          -11-                                      6765
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).

                                          -12-                                      6765

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.

                                          -13-                                      6765

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
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

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 A LAN W RIGHT & A RTHUR R.
M ILLER , FEDERAL PRACTICE AND PROCEDURE § 2716, at 435-36 (1973 & 1978 Supp.)).

                                            -16-                                       6765
             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

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

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 A GENCY
                                                                     (continued...)

                                            -19-                                       6765

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

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
                     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
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
              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
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
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
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

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

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.”).

                                          -29-                                      6765

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)).

                                            -30-                                      6765
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).

                                           -31-                                       6765

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”).

                                           -32-                                    6765

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
