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05/18/87 John A. Moore Et Al., v. Bell Telephone Company

May 18, 1987





508 N.E.2d 519, 155 Ill. App. 3d 781, 108 Ill. Dec. 358 1987.IL.640

Appeal from the Circuit Court of Du Page County; the Hon. S. Bruce Scidmore, Judge, presiding.


PRESIDING JUSTICE LINDBERG delivered the opinion of the court. HOPF and WOODWARD, JJ., concur.


Defendant, Illinois Bell Telephone Company, appeals from a judgment of the circuit court of Du Page County in favor of plaintiffs, John A. Moore (Moore) and Raymond L. Berens (Berens), in the amount of $196,655 for Moore and $262,289 for Berens. Plaintiffs cross-appeal from the circuit court's denial of attorney fees and prejudgment interest.

The record shows that plaintiffs' claim and the trial court's judgment were based upon a document (the incentive plan) entitled "Performance Measurement and Compensation 1982." Although defendant in its brief discusses the applicability of quantum meruit, this case was not litigated on that theory in the trial court, the trial court did not premise the judgment on that theory, and plaintiffs do not argue in their brief that the judgment may be sustained on that theory. Accordingly, we will not address the applicability of quantum meruit, but rather will consider only those theories argued by the parties based on the incentive plan.

Defendant contends that the judgment is erroneous, because plaintiffs were not entitled to the amounts awarded under the incentive plan as a matter of contract law or under the doctrine of promissory estoppel. Plaintiffs dispute both of these contentions and, on cross-appeal, argue that two statutes entitled them to attorney fees (Ill. Rev. Stat. 1985, ch. 13, par. 13) and prejudgment interest (Ill. Rev. Stat. 1985, ch. 17, par. 6402). We reverse the awards to plaintiffs. Because plaintiffs' argument that they are entitled to attorney fees and prejudgment interest depends on their being the prevailing parties, we affirm the denial of attorney fees and prejudgment interest based upon our reversal of the awards for plaintiffs.

Plaintiffs worked for defendant as account executives. In 1982, there were three components to plaintiffs' pay: base salary, incentive pay, and merit award. In dispute is the amount of incentive pay to which plaintiffs were entitled for 1982.

The subject of incentive pay -- including how the amount was to be determined -- was covered extensively in the written incentive plan. This incentive plan was distributed by defendant to the employees it affected, including plaintiffs as account executives.

The first page after the incentive plan's title page contained only three sentences, which read:

"AT&T reserves the right to amend, change, or cancel the Incentive Plan at its discretion. It also reserves the right to reduce, modify, or withhold awards based on individual performance or management modification. The Plan is a statement of management's intent and is not a contract or assurance of compensation."

The reference to "AT&T" was due to the incentive plan's having been written by AT&T. Defendant, which in 1982 was a wholly owned subsidiary of AT&T, chose to use the incentive plan for that year.

Plaintiffs were assigned to a "module" which sold telecommunications equipment to one customer: Bell Telephone Laboratories (Bell Labs), which in 1982 was also a subsidiary of AT&T. The details of the operation of the incentive plan are not relevant to our Disposition of this case, so they will not be set forth here. It suffices to note that during 1982 the parties operated under the incentive plan. This included setting goals for plaintiffs' sales for the year, periodically reviewing those goals in light of current information, and revising those goals upward twice, first to include additional products and second because of better-than-expected sales. Plaintiffs' final sales totaled 805.2% of their goal. In early 1983, defendant reviewed plaintiffs' incentive pay and decided that plaintiffs' achievement was due in part to the parties setting plaintiffs' goals too low because of a failure to fully appreciate the effects that (1) Bell Labs, being another AT&T subsidiary, and (2) the breakup of AT&T on January 1, 1983, would have on 1982 ...

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