Sabatini v. Hensley

DRAPER, J.

Plaintiff employee brought this action on a common count for work and labor performed for defendant employers. Jury verdict was for plaintiff in the sum of $6,500. Defendants appeal. All the stock of appellant corporation is owned by the individual appellant, his wife and his children. He will be referred to as appellant.

Respondent went to work for appellant September 15, 1952, at a salary of $400 per month. This was increased from time to time until it reached $525 per month. Respondent’s theory is that appellant promised to pay him bonuses over and above his salary, and he seeks only such excess in this action. He does not contend that any agreement for payment of bonus was made before the employment began, but he did testify that at the time of employment appellant acknowledged that the salary was low and stated this would be made up at a later date, saying “I starve, you starve; I prosper, you prosper.”

There is evidence that “early in 1954” the parties discussed respondent’s compensation. Appellant said he realized he had promised respondent a new car, but would like to postpone its purchase because of needs for expansion of the business. In July or August, 1955, appellant said it was time to purchase the car. Respondent turned in his old ear, took title in his own name to the new, and appellant made the monthly payments on it until respondent left his employ. Respondent also testified that in October or November, 1954, appellant told him that effective January 1, 1955, he would receive, in addition to salary, a bonus or commission. Respondent left the employment January 11, 1956. The jury found that respondent was entitled to a bonus of $4,000 for services rendered during the year 1955, and to $2,500 as the value of the “car bonus for previous years.”

In attacking the award of $4,000 for the year 1955, appellant argues that an express contract is necessary to overcome

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the normal rule that salary paid and accepted is in full compensation for all services rendered, and that no such express contract is here shown because no fixed amount or formula for determining a fixed amount was agreed upon. This argument mistakes the rule applicable. When an employer promises a prospective employee a fixed salary and an indeterminate bonus, each promise is made to induce undertaking of the employment. Acceptance of the employment is consideration for the promise of a bonus, and this promise thus is enforceable.