Mater v. Hupp Corp.

• Decision Date: 13 July 1959
• Docket Number: No. 1,No. 47066,47066,1
• Citation: Mater v. Hupp Corp., 326 S.W.2d 99 (Mo. 1959)
• Parties: J. E. MATER, Appellant, v. HUPP CORPORATION and Gibson Refrigerator Company, a Division of Hupp Corporation, Respondents
• Court: Missouri Supreme Court

Page 99

326 S.W.2d 99

J. E. MATER, Appellant, v. HUPP CORPORATION and Gibson Refrigerator Company, a Division of Hupp Corporation, Respondents.

No. 47066.

Supreme Court of Missouri, Division No. 1.

July 13, 1959 As Modified on Court's Own Motion July 15, 1959.

Donald F. Price, Kansas City, for appellant.

Martin J. Purcell, James C. Mordy, Morrison, Hecker, Buck, Cozad & Rogers, Kansas City, for respondents.

COIL, Commissioner.

J. E. Mater was employed by Gibson Refrigerator Company as divisional sales manager from March 1953 until June 15, 1956, when he was discharged. He sought a declaratory judgment construing a letter attached to his petition which he alleged was a contract of employment for the period of one year subsequent to October 1, 1955. He averred that there was $9,982.69 due him, less $1,017.31 which he owed Gibson, making the net amount claimed and in dispute $8.965.38. Plaintiff also sought an accounting to establish that the claimed amount was in fact due under the compensation plan in his alleged employment contract.

Defendants admitted that plaintiff was employed by Gibson as division 11 sales manager (for refrigerators, freezers, ranges, and room air conditioners) from March 1953 until June 15, 1956, when he was discharged. Defendants claimed that plaintiff's employment was terminable at will and that under the compensation plan there was a net amount due plaintiff of $301.55.

The trial court adjudged that plaintiff's employment was terminable at will and that plaintiff was entitled to compensation in accordance with the plan in force between the parties on sales on and prior to June 15, 1956, and ordered defendants to, and defendants did, render an accounting which resulted in a net judgment for plaintiff in the sum of $301.55.

The case was tried by the court below and thus on review we weigh the evidence and arrive at our own conclusion as to its weight.

The letter plaintiff relied on as his employment contract was from Gibson to him dated October 17, 1955, and had as its subject 'Divisional Sales Managers Compensation Program for Gibson Fiscal Year October 1, 1955 through September 30, 1956.' It was obviously a form sent to all divisional sales managers with the name of a particular manager and the quota assigned to him inserted to individualize each letter. The first and second paragraphs predicted a good 1956 fiscal year for Gibson and enjoined plaintiff to promote and sell the Gibson line through his distributors and dealers, and the third is: 'With a great deal of pleasure I am happy to present your compensation plan for the year 1956.

"Your Minimum Quota
                  Net Billing Dollars ................................ $843,166.00 
                                                                       ---------------
                 Your Base Quota
                  Net Dollars based on Gibson
                  Billing to your Distributors ....................... $500,000.00 
                                                                       ---------------
                    For the first hundred thousand
                    net billings above base quota ... one-half of one percent
                    Next hundred thousand ........... three-quarters of one percent.
                    Next hundred thousand ........... one percent.
                    Next hundred thousand ........... one and one-quarter percent.
                    Next hundred thousand ........... one and one-half percent.
                    All over this point ............. one and one-half percent,
                    until combined salary and bonus earnings equal the ceiling of
                    $17,500.00"
                

The fourth, fifth, and sixth paragraphs had to do with the elimination from consideration of certain items in determining plaintiff's compensation. And the letter concludes: 'The Gibson program for 1956 is bigger and better than ever * * * and we are expecting each of our Divisional Sales Managers to earn a handsome bonus. It's a year of opportunity for all of you. Remember * * * Sell More * * * Have More! Good luck!'

Plaintiff admitted that at the time he was employed he executed a document headed 'Employment Application and Record.' That application contained information as to plaintiff's background and showed that he was employed in the sales department as divisional sales manager at $700 per month. It also contained this, addressed to Gibson over the signature of plaintiff under date of March 23, 1953: 'I understand that I am not employed for any definite period of time. Anything herein to the contrary not withstanding. * * * I have read and accepted this printed contract.'

It is thus apparent that plaintiff's original employment was terminable at will and if he was employed for a definite term consisting of the fiscal year October 1, 1955 to September 30, 1956, it was by virtue of some arrangement between the parties different from and entered into subsequent to the contract of March 1953. While plaintiff relies principally on the October 17, 1955 letter as establishing that he was employed for the full 1955-56 fiscal year, he also points out that a memorandum was furnished him at the time of his employment outlining the Gibson Refrigerator Company's compensation plan which stated, among other things, that the plan provided: a guaranteed base salary payable semimonthly, that the company would pay approved traveling and other expenses, a retirement program, a life insurance program, and certain 'incentive' commissions; and that thereafter letters setting forth plaintiff's annual sales quota and base quota for six months of the fiscal year 1952-53 and for fiscal years 1953-54 and 1954-55 were delivered to plaintiff. In so far as concerns the present question, however, those letters in so far as they are similar, are essentially the same as the letter of October 17, 1955, attached to plaintiff's petition, and thus, in our view, the decisive question is whether the 1955 letter changed or modified plaintiff's employment from one terminable at will to one for the period of one year subsequent to October 1, 1955.

It is clear to us that there is nothing in the letter of October 17, 1955 which changed plaintiff's written employment agreement entered into in March 1953. The October 17, 1955 letter clearly dealt with the subject of a compensation program and plan; it did not purport to relate to or deal with the length of plaintiff's employment. The fact that the letter presented a 'compensation plan for the year 1959' and otherwise referred to 1956 as a big year in prospect reasonably could not have meant that plaintiff was thereby employed for the entire fiscal year 1956 when the letter's language is viewed in the light of the written contract wherein plaintiff had theretofore agreed that his employment was for an indefinite time. None of the language employed in the 1955 letter evidenced an intention to change or modify plaintiff's existing indefinite term of employment. We recognize that where the compensation rate is agreed on for a year that, even though such alone is not sufficient to establish an employment for a year, the fact may be some evidence of the intention of the parties. Davis v. Pioneer Life Ins. Co. of America, 181 Mo.App. 353, 356, 172 S.W. 67, 68[1, 2]. Under the instant facts, however, the October 17, 1955 letter must be viewed in the light of the fact that plaintiff's employment had theretofore been fixed as one terminable at will. When so viewed the most reasonable conclusion is that plaintiff's employment was terminable at will and that defendants could discharge plaintiff at any time with or without cause. Christy v. Petrus, 365 Mo. 1187, 295 S.W.2d 122, 124.

It is conceded that plaintiff's net buillings from October 1, 1955 through June 15, 1956 (date of discharge) exceeded plaintiff's base quota of $500,000 established in the October 17, 1955 letter. Plaintiff contends that consequently he was entitled to his monthly salary (which had been increased to $750 in March 1956) for the remainder of the fiscal year and to commissions on all billings in his territory in excess of the $500,000 base quota until the end of the fiscal year, despite his discharge. Plaintiff's point, as we understand it, is that once his billings exceeded his base quota he had earned his salary or 'draw' for the remainder of the year and also that he thereby became vested with a right to receive commissions on all billings in his former territory for the remainder of the fiscal year. We cannot agree. We think it is clear that the compensation provided for in the October 17, 1955 letter, whether salary or drawing account or commission, was to be paid at the stated rates for whatever portion of the 1955-56 fiscal year plaintiff worked for Gibson.

There is no merit in plaintiff's contention that the trial court erred in entering its interlocutory decree requiring defendant to account. Plaintiff petitioned the court to order an accounting, did not object at the time the court so ordered, and, in any event, no possible prejudice to plaintiff could have resulted from the procedure whereby the amount due him was determined.

The remainder of plaintiff's contentions relate to the accounting. The trial court held that in arriving at the amount due plaintiff the $500,000 base quota established for him in the October 17, 1955 letter should be reduced to a figure equal to 8 1/2 twelfths thereof ($354,166.67) because plaintiff's employment had continued for only 8 1/2 months of the fiscal year. Plaintiff says the trial court thereby made a new contract for the parties and one contrary to the interpretation the parties had placed on their contract. In view of the fact, however, that we have held plaintiff's employment was terminable at will and that plaintiff was entitled only to what was due to the date of his discharge, plaintiff would not wish to insist that his base quota should have remained at $500,000, for, obviously, the lower the base quota, the greater the amount of commission accrued under the compensation plan. In any event, the trial court's action in that respect was correct.

One of the items involved in...