Erickson v. American Golf Corp.

96 P.3d 843, 194 Or. App. 672, 2004 Ore. App. LEXIS 1013
CourtCourt of Appeals of Oregon
DecidedAugust 25, 2004
DocketCCV0012263; A118427
StatusPublished
Cited by3 cases

This text of 96 P.3d 843 (Erickson v. American Golf Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Erickson v. American Golf Corp., 96 P.3d 843, 194 Or. App. 672, 2004 Ore. App. LEXIS 1013 (Or. Ct. App. 2004).

Opinion

*674 LINDER, J.

Plaintiff was employed by defendant American Golf Corporation as general manager of the Oregon Golf Club. After his employment was terminated in 2000, he brought this breach of contract and statutory unpaid wages action, claiming that he had not been paid the full amount of his 1996 and 1999 bonuses. The case was tried to a jury, which returned a verdict for plaintiff. Defendant appeals, arguing that the trial court erred in giving a particular instruction to the jury and in granting a partial directed verdict against defendant’s affirmative defenses of accord and satisfaction and waiver. Plaintiff cross-appeals, assigning error to the trial court’s refusal to award a statutory penalty based on plaintiffs favorable verdict on the wage claim. See ORS 652.150. We reverse on appeal, concluding that the challenged jury instruction was properly given, but that defendant’s affirmative defenses were erroneously withdrawn from the jury. Because that disposition requires a new trial, we dismiss the cross-appeal as moot.

We state the facts, and all reasonable inferences that they support, in the light most favorable to defendant, the party opposing the directed verdict motion. Vandermay v. Clayton, 328 Or 646, 648, 984 P2d 272 (1999). Plaintiff, who had worked as the manager of one of defendant’s golf clubs in Texas, transferred to Oregon to manage the Oregon Golf Club after defendant purchased it in 1995. Around the time of plaintiffs transfer to Oregon, defendant instituted a new bonus and profit-sharing plan that contained two components: an annual bonus beginning in 1996 and a three-year long-term bonus to be paid in 1999. For the annual bonus, if a club achieved a certain predetermined proportion of its profit goals, the manager was to receive a “base bonus,” which was a percentage of the manager’s annual base salary. If the club exceeded its profit goals, the annual bonus was to further include a “threshold bonus,” which consisted of a percentage of the club’s excess profits, with the percentage increasing progressively as the profits exceeded that club’s targets. The amount of the long-term bonus was to be based on an average of the bonuses paid in 1996, 1997, and 1998, which was then subject to a multiplier based on the extent to *675 which a particular region had reached or exceeded its profit goals.

Each general manager received a document describing the plan in detail. The document identified the formula to be used to calculate the amount of the annual bonus and stated expressly that there was no cap on the potential bonus that a general manager could earn. In addition to that document, each general manager also received a one-page worksheet for calculating his or her individual annual bonus that specified the relevant targets for that manager’s property. At the bottom of that worksheet was the statement “[b]onus plan is subject to approval by the executive committee.” To receive a bonus at the end of the year, the general managers were required to complete the worksheet and submit it to the executive committee. In past years, individual bonuses were paid only after committee review and approval of each manager’s worksheet.

Plaintiff received his worksheet after both the plan document and the formula for plaintiffs annual bonus had been approved by defendant’s executive committee. In its first year under plaintiffs management, the Oregon Golf Club substantially exceeded its profit targets. According to the bonus plan and the calculations set forth in plaintiffs worksheet, plaintiffs annual bonus worked out to approximately $128,000, which would have been the largest annual bonus, by a significant margin, ever paid to a general manager by defendant. When plaintiff submitted his worksheet containing the $128,000 figure to Seidl, his regional manager, Seidl told plaintiff that he was concerned that submitting a bonus for that amount “would be a risk in terms of being approved.” Seidl suggested that, as an alternative, plaintiff ask for a lower bonus and accept an increase in his base pay for the next year, which would give him a potentially greater future bonus as well. When plaintiff asked Seidl what would happen if he were to submit the $128,000 figure, Seidl responded, “[T]he company’s got to do what they got to do.” According to Seidl, he meant only that if plaintiff did not submit a lower bonus figure, plaintiff risked having the executive committee reduce it. Plaintiff, however, believed that Seidl was warning him that a request for a $128,000 bonus would place his job at risk.

*676 Although plaintiff continued to believe that he was entitled under the plan to a bonus of $128,000, he signed and submitted a bonus worksheet for a bonus of $81,561. Plaintiff also agreed to a 10 percent increase in salary for the next year, thereby increasing his bonus potential in the future. The executive committee approved the bonus in the amount submitted by plaintiff and paid plaintiff accordingly. Plaintiff also received the 10 percent raise, as agreed, even though the average base pay increase that year for other general managers was three percent. Three years later, plaintiff’s long-term bonus was calculated using the $81,561 bonus that plaintiff had accepted, rather than the $128,000 bonus to which plaintiff believed he had been entitled. Plaintiff accepted the resulting long-term bonus amount without protest.

Plaintiffs employment with defendant terminated in September 2000 for reasons unrelated to the present dispute. Plaintiff then brought this action, alleging that, by failing to pay plaintiff the full $128,000 bonus in 1996 and by not using that figure to calculate his long-term bonus in 1999, defendant breached the employment contract with plaintiff and failed to pay plaintiff wages that were due. 1 In addition to the unpaid wages, plaintiff sought a statutory penalty for nonpayment of those wages pursuant to ORS 652.150. In its answer, defendant asserted, among other things, affirmative defenses of accord and satisfaction and waiver. Plaintiff responded by filing a motion for a directed verdict to exclude those defenses at trial, which the trial court granted.

The case was tried to a jury. Plaintiffs principal theory was that he interpreted the disclaimer on the worksheet — “bonus plan is subject to approval by executive committee” — to require only approval of the plan formula, not of the actual payout amount based on that formula. Defendant *677 countered with its interpretation of the contract: that the disclaimer required executive committee approval of the individual annual bonus payout amounts. The jury returned a verdict for plaintiff. The trial court, awarded damages for breach of contract but declined to assess penalties based on plaintiffs wage claim. This appeal followed.

Defendant’s first assignment of error raises the issue whether a trial court may properly advise a jury that, if it cannot determine the parties’ intent as to ambiguous terms of a contract, the jury should construe the contract against the drafter.

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Cite This Page — Counsel Stack

Bluebook (online)
96 P.3d 843, 194 Or. App. 672, 2004 Ore. App. LEXIS 1013, Counsel Stack Legal Research, https://law.counselstack.com/opinion/erickson-v-american-golf-corp-orctapp-2004.