Berutti v. Dierks Foods, Inc.

• Citation: 496 N.E.2d 350,145 Ill.App.3d 931,99 Ill.Dec. 775
• Decision Date: 30 July 1986
• Docket Number: No. 2-85-0442,2-85-0442
• Parties: , 99 Ill.Dec. 775 Clifford BERUTTI, Plaintiff-Appellee, v. DIERKS FOODS, INC., Defendant-Appellant.
• Court: United States Appellate Court of Illinois

Page 350

496 N.E.2d 350

145 Ill.App.3d 931, 99 Ill.Dec. 775

Clifford BERUTTI, Plaintiff-Appellee, v. DIERKS FOODS, INC., Defendant-Appellant.

No. 2-85-0442.

Appellate Court of Illinois Second District.

July 30, 1986.

Fox & Grove, Chtd., S. Richard Pincus, William Henry Barrett, Martin K. Dennis, Chicago, Clark McGreevy & Johnson, Michael T. McGreevy and Lawrence R. Kream, Rockford, for defendant-appellant.

Marsha J. Caporaso, Sleepy Hollow, for plaintiff-appellee.

Justice STROUSE delivered the opinion of the court:

Clifford Berutti filed an action for damages for breach of an employment contract when he was terminated by Dierks Foods, Inc. He was granted summary judgment in the amount of $15,800.00. Dierks Foods timely appeals from the summary judgment.

Dierks Foods sells grocery products to retail outlets. Berutti, who was employed by a competitor, was contacted in February 1983 by Stanley Weinstein, a personnel recruiter for Dierks Foods. Weinstein forwarded Berutti's resume to Ronald Dierks, president of Dierks Foods, Inc., who thereafter dealt with Berutti. There followed several interviews concerning sales volume and compensation. Dierks told Berutti that he would want an increase in sales in his assigned area which should generate a million dollars in sales volume.

Dierks regularly used a straight commission basis to compensate street salesmen. Berutti, who did not know how many of his former customers would come over with him, refused to be compensated on a commission basis. Therefore, Dierks agreed to start Berutti with a compensation package which included a base weekly salary of $750, a monthly auto expense reimbursement of $250, and company health benefits.

Berutti wanted a written confirmation of how Dierks was going to compensate him. Weinstein sent Berutti a letter dated April 21, 1983, which, in pertinent part, stated:

"Per your agreement with Mr. Ron Dierks, you will be joining the Company on 9, May, 1983. The following terms and conditions have also been agreed upon:

A. Guaranteed salary for twelve months of $750.00 per week. ($39K per annum).

B. Guaranteed auto allowance of $250.00 per month.

C. Usual and customary Company medical benefit program."

A copy was sent to Dierks.

Berutti contends this was an agreement to compensate him at the weekly rate of $750, for a period of a year, and to thereafter pay him on a commission basis. Dierks argues that the $750 was only a base salary, and that the letter did not include all the terms to which the parties had agreed. Neither party sought to modify the written agreement.

Berutti's sales volume decreased from $65,457 in May, to $40,867 in September. In September, Dierks told Berutti that he was dissatisfied with Berutti's sales performance and that if his sales "didn't increase, he would have to take some action." Berutti expressed his own dismay about his sales performance and stated that he would endeavor to increase his sales. Berutti's October sales decreased to $37,318. Dierks then terminated Berutti on the basis of his inadequate sales performance.

Judge Layng granted summary judgment for Berutti ruling that he had "a guaranteed no-cut contract." He concluded that the April 21, 1983, Weinstein letter was for "12 months whether his performance was good, bad, indifferent," and there were no circumstances, "unless he was a criminal [or] something of that nature," under which Berutti could be terminated. He assessed damages at $15,800--the contract amount less monies received from unemployment compensation disbursements. Dierks timely appealed.

On appeal from an order granting summary judgment, a reviewing court must consider all grounds and facts urged below to determine if genuine issues of material fact exist and whether the moving party was entitled to summary judgment as a matter of law. (Talos v. Youngstown Sheet & Tube Co. (1985), 134 Ill.App.3d 103, 108, 89 Ill.Dec. 46, 479 N.E.2d 1052; Newell v. Field Enterprises, Inc. (1980), 91 Ill.App.3d 735, 741, 47 Ill.Dec. 429, 415 N.E.2d 434.) Defendant contends that the following issues of material fact are disputed: (1) the parties disagree as to the terms of the oral employment contract; and (2) the intent of the parties in using the terms in the written agreement.

Plaintiff contends that there is no genuine issue as to any material fact. Defendant points to the deposition of Mr. Dierks wherein he admits that he: (1) discussed the terms of employment that he had proposed to Mr. Berutti with the employment agent; (2) received the letter which was sent from the agent to Berutti; (3) read the contents of the letter; (4) testified that the representations made in the letter were not inaccurate; and (5) made no attempt to alter any terms of the agreement after receiving the copy.

Where terms of a contract are clear and unambiguous, they will be given their natural and ordinary meanings. (Wil-Shore Motor Sales, Inc. v. Continental Illinois National Bank & Trust Co. of Chicago (1984), 130 Ill.App.3d 167, 85 Ill.Dec. 648, 474 N.E.2d 376.) A contract is ambiguous if, and only if, it is reasonably or fairly susceptible of different constructions, and it is not ambiguous if a court can determine its meaning without any guide other than a knowledge of the simple facts on which, from the nature of the language in general, its meaning depends. (Whiting Stoker Co. v. Chicago Stoker Corp. (1949), 171 F.2d 248, cert. denied (1949), 337 U.S. 915, 69 S.Ct. 1155, 93 L.Ed. 1725.) Also, where it is not ambiguous, the intent of the parties must be determined from the language of their agreement alone (Schek v. Chicago Transit Authority (1969), 42 Ill.2d 362, 247 N.E.2d 886), and contract language is not rendered ambiguous simply because the parties do not agree upon its meaning (Harris v. American General Finance Corp. (1977), 54 Ill.App.3d 835, 839, 11 Ill.Dec. 491, 368 N.E.2d 1099). Further, the Illinois rule is well stated in that contract language which is ambiguous or uncertain should be resolved against the party which created it. Watson Lumber Co. v. Guennewig (1967), 79 Ill.App.2d 377, 226 N.E.2d 270; see also Dr. Charles W. Smith, III, Ltd. v. Connecticut General Life Insurance Co. (1984), 122 Ill.App.3d 725, 78 Ill.Dec. 485, 462 N.E.2d 604.

In the instant case, the agreement is not ambiguous. Construing the evidence strictly against the moving party and liberally in favor of the opponent (Talos v. Youngstown Sheet & Tube Co. (1985), 134 Ill.App.3d 103, 108, 89 Ill.Dec. 46, 479 N.E.2d 1052), we find that no genuine issue of material fact exists; all that is necessary is to determine if the lower court properly determined the legal relationship of the parties and the consequences of their actions.

The law in Illinois is well settled that a hiring at a monthly, or even an annual salary, if no period of duration is specified, is at will. (Mann v. Ben Tire Distributors, Ltd. (1980), 89 Ill.App.3d 695, 697, 44 Ill.Dec. 869, 411 N.E.2d 1235; Atwood v. Curtiss Candy Co. (1959), 22 Ill.App.2d 369, 161 N.E.2d 355.) Berutti's employment confirmation stated that one term of his agreement with Dierks was "A. Guaranteed salary for twelve months of $750 per week. ($39 K per annum)." Defendant contends that this language does not constitute a "term of duration," but merely reflects the rate of compensation. Defendant relies on Kepper v. School Directors of District No. 120 (1975), 26 Ill.App.3d 372, 325 N.E.2d 91, where the court stated that "a contract specifying no duration of employment, and thus terminable at will, is not made otherwise by the inclusion of salary rates based on units such as months or years." (26 Ill.App.3d 372, 374, 325 N.E.2d 91; see also Payne v. AHFI/Netherlands, B.V. (N.D.Ill.1980), 522 F.Supp. 18, 22 (letter's reference to an annual rate of pay does not alter the conclusion that plaintiff's employment was at will); Medina v. Spotnail, Inc. (N.D.Ill.1984), 591 F.Supp. 190, 197 ("Payment of salary calculated on an annual basis is not enough to create an employment contract for a specific duration.").) Plaintiff contends that Grauer v. Valve & Primer Corp. (1977), 47 Ill.App.3d 152, 5 Ill.Dec. 540, 361 N.E.2d 863, and Miller v. Community Discount Centers, Inc. (1967), 83 Ill.App.2d 439, 228 N.E.2d 113, support affirming the trial judge's decision.

In Kepper, the discharged employee, a school custodian, appealed the dismissal of his complaint against the school board. The trial court determined, and the appellate court agreed, that the collective bargaining agreement on which the employee relied did not constitute a contract of employment involving the employee individually. While the "Working Agreement" specified the amount of compensation and other items which were applicable for a period from July 1, 1970, to July 1, 1971, the court determined that the agreement merely specified certain terms and conditions relating to all custodians during the particular time indicated. (26 Ill.App.3d 372, 374, 325 N.E.2d 91.) It had no provision as to termination of employment and more importantly, did not establish the duration of plaintiff's employment in any manner.

In Miller v. Community Discount Centers, Inc. (1967), 83 Ill.App.2d 439, 228 N.E.2d 113, the appellate court affirmed the trial court's judgment against the employer. The plaintiff came from Toledo, Ohio, to Chicago, Illinois, in response to a classified ad which had been placed by the defendant. The plaintiff was offered a position as a management trainee at a specified annual salary. In confirmation of his appointment, he...