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Wilson v. Lasalle Mfg. & Machine Co.

OPINION FILED MARCH 22, 1978.

ORVILLE WILSON ET AL., PLAINTIFFS-APPELLANTS,

v.

LASALLE MANUFACTURING AND MACHINE COMPANY ET AL., DEFENDANTS-APPELLEES.



APPEAL from the Circuit Court of La Salle County; the Hon. WENDELL L. THOMPSON, Judge, presiding.

MR. PRESIDING JUSTICE ALLOY DELIVERED THE OPINION OF THE COURT:

Plaintiffs Orville Wilson and Charles Siroin appeal from an order of the Circuit Court of La Salle County granting a motion to dismiss a complaint filed by plaintiffs to recover what were asserted as bonus payments allegedly due the plaintiffs, as employees of defendants. The amended complaint of plaintiffs was dismissed by the trial court with prejudice.

On appeal to this court, plaintiffs contend that the trial court erred in dismissing the complaint (1) on the contention that the provision that "bonus payments would be made only to employees employed as of the date of payment" and the further provision that "persons no longer employed will not receive bonus payments and their absence will allow division of the remaining bonus pool among the existing employees" is void as a penalty and is not enforceable and (2) on the contention that discharge of the plaintiffs-employees for the purpose of depriving them of their share of the bonus pool was fraudulent and, also, that discharge of the employees made impossible the performance by the employees of the condition precedent to qualify for payment of a share of the profits described as a bonus.

Plaintiffs' amended complaint alleged that plaintiffs Wilson and Siroin were employed by defendants under oral employment contracts beginning in April 1973 and in April 1972, respectively. The complaint further alleged that in March 1974 defendants instituted a bonus plan for their employees. That bonus plan, a copy of which was attached to the complaint, stated that:

"It will be the compensation policy of * * * [defendants] to pay average competitive compensation for each class of employee, and not to pay on the high side, but to offer an attractive bonus compensation to all employees to the extent that their good efforts result in profitability above a minimal acceptible [sic] level to the owners."

The plan provided for the creation of a bonus pool dependent in amount upon the profitability of defendants' business, and for distribution of the bonus pool to defendants' employees based upon the production of each employee's gross earnings as related to the gross earnings of all employees receiving bonus payments in such classification. By the terms of the bonus plan, the calculation of the profitability of defendants' business and calculation of the amount of the bonus pool were to be made monthly. The plan generally provided that payment of a given month's bonus would be made one-third by the 15th of the month following, and one-third by the following December 15. The remaining payment for a given year would be made by March 15 of the following year, after final calculation of the profitability of defendants' business for the given year.

While all of the defendants' employees were included in the bonus plan, the plan specified that bonus payments were to be made only to persons currently employed by defendants on the date of payment, and that all of the bonus pool would be distributed to defendants' existing employees on that date of payment. The amended complaint alleged that plaintiffs Wilson's and Siroin's employments were terminated by defendants on January 18, 1975, and on October 22, 1974, respectively, for the purpose of depriving plaintiffs of their share of the bonus pool. Plaintiffs' complaint sought recovery from defendants of the so-called bonus amounts calculated for the months prior to the terminations of plaintiffs' employments, but which amounts were not scheduled to be paid (under the specific terms of the bonus plan) until after the dates of plaintiffs' terminations. As we have noted, the trial court granted the motion to dismiss the amended complaint with prejudice under section 45 of the Civil Practice Act (Ill. Rev. Stat. 1975, ch. 110, par. 45).

As noted, the plaintiffs first contend that the provisions of the bonus plan, which specified that bonus payments would be made only to persons employed on the date of payment, are void and unenforceable as a penalty, and cannot act to deprive plaintiffs of bonus amounts calculated for months during which plaintiffs were employed by defendants. As we have noted, the plan specifies particularly that bonus payments are to be made only to persons actually in defendants' employ on the date of payment. Plaintiffs contend that this results in an improper forfeiture of bonus payments. The specific plan, which is a noncontributory plan insofar as employees are concerned, simply provides that "bonus payments will be made only to employees employed as of the date of payment" and states that "persons no longer employed will not receive bonus payments and their absence will allow division of the remaining bonus pool among existing employees."

The employer contends that those provisions are in form and substance, qualifications and restrictions upon participating in the plan which must be satisfied by the employees before they are entitled to payment. Thus, the employer contends that the provisions as specified are conditions precedent to participation in distributions from the bonus pool. The trial court agreed with defendants' contentions.

• 1, 2 General principles which govern interpretation and construction of contracts and agreements are well established. When language of the agreement is unambiguous and clear, there is no need to look beyond the instrument to determine the intention of the parties (Sigma Delta Tau Society v. Alongi (2d Dist. 1976), 44 Ill. App.3d 650, 652, 358 N.E.2d 906) and, as stated in Speasl v. National Bank (3d Dist. 1962), 37 Ill. App.2d 384, 387, 186 N.E.2d 84, 86:

"It is elementary that the agreement of the parties governs their rights thereunder unless the undertaking be contrary to some rule of positive law or offensive to public policy."

It is not within the province of a court to make a new agreement for the parties or, by construction, to write a new agreement into which the parties have not entered (Sigma Delta Tau Society v. Alongi (2d Dist. 1976), 44 Ill. App.3d 650, 358 N.E.2d 906). As was stated in Whaley v. American National Insurance Co. (4th Dist. 1975), 30 Ill. App.3d 32, 34, 331 N.E.2d 571:

"the courts> cannot make a new contract by supplying provisions, nor give plain and unambiguous language a distorted construction."

The entire bonus plan is also devoid of any reference to "forfeiture" or "penalty" but rather clearly emphasizes, as a condition precedent to payment, that employees who will participate in the payments at any such ...


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