Majmudar v. House of Spices (India), Inc.

• Decision Date: 22 November 2013
• Docket Number: No. 1–13–0292.,1–13–0292.
• Parties: Subhash MAJMUDAR, Plaintiff–Appellant, v. HOUSE OF SPICES (INDIA), INC., Defendant–Appellee.
• Court: United States Appellate Court of Illinois

2013 IL App (1st) 130292
1 N.E.3d 1207
377 Ill.Dec. 320

Subhash MAJMUDAR, Plaintiff–Appellant,
v.
HOUSE OF SPICES (INDIA), INC., Defendant–Appellee.

No. 1–13–0292.

Appellate Court of Illinois,
First District, Fifth Division.

Nov. 22, 2013.

[1 N.E.3d 1208]

Matthew T. Layman, Moran Law Group, Chicago, for appellant.

David S. Baffa, Seyfarth Shaw LLP, Chicago, for appellee.

OPINION
Justice McBRIDE delivered the judgment of the court, with opinion.

¶ 1 This appeal arises out of a dispute between plaintiff Subhash Majmudar and defendant House of Spices (India), Inc., after plaintiff's employment with defendant was terminated approximately 15 months into a 5–year employment contract. On appeal, plaintiff's sole contention is that the trial court erred in finding that he was not entitled to relief pursuant to the Illinois Wage Payment and Collection Act (Act) (820 ILCS 115/1 et seq. (West 2006)). We affirm.

¶ 2 Plaintiff filed his original complaint on April 21, 2008, alleging a breach of contract and a claim under the Act. On May 14, 2008, he filed an amended complaint alleging a breach of contract, a claim under the Act, and two claims that were dismissed before trial. The pertinent facts according to the complaint are as follows: on August 27, 2006, plaintiff entered into a contract with Gorhandas L. Soni (G.L. Soni), the president of House of Spices for a fixed five-year term with additional benefits. The contract was reduced to a typed document the following day. According to plaintiff, he fully performed under the contract but his employment with defendant was terminated on December 12, 2007. Plaintiff claimed that defendant breached the contract and, as a result, he was entitled to the $625,309.75 in salary and benefits he stood to gain from the remainder of the contract. Plaintiff also requested relief pursuant to the Act in the form of $625,309.75 in compensatory damages, reasonable attorney fees, and the costs of suit.

¶ 3 The handwritten contract is dated August 27, 2006, titled “5 year contract,” and provides:

“This is to certify that G.L. Soni & Subhash Majmudar agreed as under on 8/27/06:

(1) His Base Salary is $111,000.00

(2) Monthly car coupons will be paid by [House of Spices]

[1 N.E.3d 1209]

(3) A [increase] [ sic ] of $10,000.00 will be paid after 6 months

(4) Annual Bonus will be paid

(5) Yearly Salary increase will be paid”

The contract is signed by G.L. Soni and plaintiff. The typed document is substantially the same as the handwritten contract, but specifies that plaintiff was hired as a warehouse coordinator and project manager. The typed document is signed by G.L. Soni.

¶ 4 In its answer, defendant alleged various counterclaims against plaintiff including breach of contract. Defendant further alleged that plaintiff resigned from his position or, alternatively, that defendant had cause to terminate plaintiff's employment.

¶ 5 The only transcripts included from the four-day bench trial in the record on appeal are the transcripts from the parties' closing arguments. Based on these arguments, we gather the following facts. Plaintiff worked for defendant beginning in 1992 until approximately July 2006 when he accepted a job with a competitor, Kohinoor Foods. There was conflicting testimony about who initiated plaintiff's return to defendant, but there was no dispute that about one month later, in August 2006, plaintiff met with G.L. Soni at which time they signed the five-year contract. It was also undisputed that plaintiff's employment with defendant ended in November 2007. Based on these facts, the central issues at trial were whether plaintiff resigned his position with defendant, whether defendant terminated plaintiff's employment, and if defendant terminated plaintiff's employment, whether defendant had cause to do so. Plaintiff argued that his wife received a call from Soni on November 30, 2007, and was told plaintiff had been terminated, effective immediately, and that he did not need to return to work. Defendant argued that plaintiff resigned after throwing down his keys and leaving the premises on four separate occasions. In the alternative, defendant argued it terminated plaintiff for cause based on plaintiff's poor treatment of employees. The parties also disagreed as to whether plaintiff was entitled to relief under the Act.

¶ 6 The circuit court found the parties had entered into an enforceable contract, that plaintiff did not resign from his position, and that defendant did not have cause to terminate plaintiff's employment. The court concluded that plaintiff's termination violated the contract and that defendant had breached the contract. The court determined that plaintiff was only entitled to two years of his salary due to plaintiff's failure to “make an honest, good faith effort to find substitute employment,” less the money plaintiff earned from interim employment, for a total of $173,000.

¶ 7 The court denied plaintiff's claim under the Act, taking the “position that the Act doesn't apply to prospective payments under the circumstances in which the termination is being contested by the employer for cause.”

¶ 8 Plaintiff filed a timely posttrial motion, arguing that he was entitled to a reversal of judgment on his claim pursuant to the Act. The circuit court denied the motion.

¶ 9 The sole question on appeal is whether the Act applies to the remaining unpaid future wages pursuant to an employment contract after that contract has been terminated. Specifically, plaintiff is seeking interest on the unpaid wages and reasonable attorney fees. This is an issue of first impression and, as a question of statutory interpretation, must be reviewed de novo. Taylor v. Pekin Insurance Co., 231 Ill.2d 390, 395, 326 Ill.Dec. 34, 899 N.E.2d 251 (2008).

¶ 10 “The cardinal rule of statutory interpretation is to ascertain and give effect

[1 N.E.3d 1210]

to the intent of the legislature.' ” Krautsack v. Anderson, 223 Ill.2d 541, 552, 308 Ill.Dec. 302, 861 N.E.2d 633 (2006). The language of the statute is the best indication of the legislature's intent and therefore must be given its plain and ordinary meaning. Id. at 553, 308 Ill.Dec. 302, 861 N.E.2d 633. If the language is unambiguous, the statute must be given effect without the use of other aids of construction. Id. A court should not consider words and phrases in isolation, but instead should interpret each word and phrase in light of the statute as a whole. Id. “ Each word, clause and sentence of a statute must be given reasonable meaning, if possible, and should not be rendered superfluous.” Standard Mutual Insurance Co. v. Lay, 2013 IL 114617, ¶ 26, 371 Ill.Dec. 1, 989 N.E.2d 591.

¶ 11 The purpose of the Act is to provide employees with a cause of action for the timely and complete payment of earned wages or final compensation. Andrews v. Kowa Printing Corp., 351 Ill.App.3d 668, 675, 286 Ill.Dec. 548, 814 N.E.2d 198 (2004), aff'd,217 Ill.2d 101, 298 Ill.Dec. 1, 838 N.E.2d 894 (2005); People ex rel. Illinois Department of Labor v. Tri State Tours, Inc., 342 Ill.App.3d 842, 845, 277 Ill.Dec. 322, 795 N.E.2d 990 (2003); Khan v. Van Remmen, Inc., 325 Ill.App.3d 49, 59, 258 Ill.Dec. 628, 756 N.E.2d 902 (2001); see also Armstrong v. Hedlund Corp., 316 Ill.App.3d 1097, 1107, 250 Ill.Dec. 199, 738 N.E.2d 163 (2000) (the Act's purpose is “to insure the prompt and full payment of wages due workers at the time of separation from employment, either by discharge, layoff or quitting”). To establish a claim under the Act, a plaintiff must demonstrate that “wages or final compensation is due to him or her as an employee from an employer under an employment contract or agreement.” Landers–Scelfo v. Corporate Office Systems, Inc., 356 Ill.App.3d 1060, 1067, 293 Ill.Dec. 170, 827 N.E.2d 1051 (2005). According to the statute, for an employee other than a separated employee, “wages” are defined as “any compensation owed an employee by an employer pursuant to an employment contract or agreement between the 2 parties, whether the amount is determined on a time, task, piece, or any other basis of calculation.” 820 ILCS 115/2 (West 2006). Payments to separated employees are termed “final compensation,” which is defined as “wages, salaries, earned commissions, earned bonuses, and the monetary equivalent of earned vacation and earned holidays, and any other compensation owed the employee by the employer pursuant to an employment contract or agreement between the 2 parties.” Id.

¶ 12 As an initial matter, there is no dispute that plaintiff was an “employee” and defendant an “employer” under the Act. However, it is unclear whether plaintiff is arguing he is owed “wages” or “final compensation” according to the statutory definitions. In his complaint, plaintiff argued he was owed both wages and final compensation and, in his appellate brief, plaintiff defines both terms and then argues he is owed “unpaid wages.” However, the record shows plaintiff is seeking relief based on final compensation. Although plaintiff argues he is owed payment for unpaid future wages pursuant to his contract, plaintiff does not argue that defendant failed to pay him anything under the contract prior to his termination. Thus, plaintiff is only looking for what he believes he was due at the termination of his contract, his final compensation as a separated employee. See Covinsky v. Hannah Marine Corp., 388 Ill.App.3d 478, 482, 328 Ill.Dec. 35, 903 N.E.2d 422 (2009) (the plaintiff argued that the defendant violated the Act by “not paying [the plaintiff] his final compensation, the sums due

[1 N.E.3d 1211]

under the employment contract, at the time of his termination”).

¶ 13 Therefore, our first step in ascertaining the intent of the legislature is to understand the meaning of “final compensation.” Plaintiff claims he is owed the unpaid future wages for the remainder of his terminated employment contract as final compensation because it is, per the statutory definition, “compensation owed the...