Home Equipment Co. v. Gorham
| Decision Date | 08 April 1941 |
| Docket Number | 27525. |
| Citation | 33 N.E.2d 99,218 Ind. 454 |
| Parties | HOME EQUIPMENT CO., Inc., v. GORHAM. |
| Court | Indiana Supreme Court |
Appeal from Circuit Court, Huntington County; Milo Feightner, judge.
Kenner & Glenn, of Huntington, for appellant.
M. J. O'Malley, of Huntington, and H. Hugh Kennerk, of Fort Wayne, for appellee.
This action was begun by the appellee by his filing a complaint in one paragraph, seeking to recover from the appellant, the Home Equipment Company, Inc., certain wages alleged to be due. The appellant filed an answer in two paragraphs, the first, a general denial, and the second, admitting an indebtedness of $283.55 to appellee for salary as of December 31, 1934, but alleging the execution of a contract by the appellant and its employees, including the appellee, by which contract the appellant agreed to 'set aside in a separate account 1/3 of all of its net earnings that may accumulate in any future ninety days period for the benefit and payment to' its employees (including the appellee) of the amounts set opposite their respective names, 'this bonus to be paid as and when it is earned' in proportion to the amount due each. The appellant further agreed that when these amounts had been paid to its employees in full another 'bonus agreement' should take its place. The contract further provided that the employees, including the appellee 'hereby release the Home Equipment Company, Inc., from any claims that they may have under headings of 'salary holdbacks." To this second paragraph of answer the appellee filed two paragraphs of reply setting up (1) that there had been a failure of consideration by reason of the failure and refusal of the appellant to set aside one-third of its net earnings, pursuant to the provisions of the contract, and (2) that the contract was illegal and against public policy. The appellant also filed a cross-complaint alleging that the appellee was indebted to the appellant in the sum of $600.
The court found the facts specially and stated its conclusions of law thereon. The essential facts as found by the court may be summarized as follows: The appellant was a corporation engaged in the business of selling electrical equipment. The appellee entered into the employment of the appellant in 1928, and remained in said employment until in November, 1937. The appellee worked for the appellant as a radio service man and as installation man for electrical equipment.
During the period from 1930 to 1934 the appellant experienced serious financial difficulties and attempted various plans for the purpose of keeping its organization together, to prevent laying off its employees, and to prevent excessive wage reductions. These plans involved holding back a certain percentage of the salary of the employees and were all agreed to by the employees. Said employees were permitted to purchase merchandise from the appellant on account and such merchandise accounts were later charged against their salary hold-back accounts.
In April, 1933, at a meeting held by the appellant and its employees, at which meeting appellee was present, it was agreed that the salary 'hold-backs' of the employees were to be paid only and solely out of the future profits of the company. On December 31, 1934, after deducting the amount due appellant for merchandise purchased by appellee, it was agreed that the balance due appellee for salary 'hold-backs' was $283.55. At the same time the amounts due to the other employees on account of the salary 'hold-backs' were determined, and the appellant and said employees thereupon entered into a written plan and agreement designated a 'bonus agreement' and each of said employees and the appellant company 'executed said written agreement in consideration of the execution thereof by each of the other parties thereto, and for good and valuable consideration'. Said agreement so entered into was the agreement described by the appellant in its second paragraph of answer herein. After the appellee signed said agreement he remained in the employment of the appellant until November, 1937, during which time he had three increases in salary. Special finding No. 8 was as follows: 'I find that the amount sued upon in plaintiff's complaint is the amount of wages due plaintiff from defendant company by virtue of the agreement set out in Finding No. 5.'
After the appellee left the employment of the appellant in November, 1937, he made a written demand on the appellant 'for wages then claimed due.'
There was no finding that appellant had and net earnings after the execution of the said 'bonus agreement', nor was there any finding that the appellant had, or had not complied with its agreement to set aside one-third of its net earnings, if any, for the benefit of the appellee and the other employees.
The first conclusion of law was as follows: 'I find on the issue raised by plaintiff's complaint and defendant's answer thereto that the law is with the plaintiff and that he should recover the sum of two hundred eighty-three and 55/100 dollars ($283.55) with interest at six per cent (6%) from November 24, 1937 to this date, making in all Three Hundred Fourteen and 73/100 Dollars ($314.73).'
The second conclusion of law concluded that the appellant on its cross complaint should recover the sum of $11.59, which amount should be deducted from the amount due appellee leaving a balance of $303.14 due appellee.
The only alleged errors upon which the appellant relies are that the court erred in its first and second conclusions of law.
The contention of the appellant is that the trial court erred in permitting a recovery by the appellee of wages, all claims to which had been released by the appellee by the provisions of...
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