Plowman v. Indian Refining Co.,

20 F. Supp. 1 (E.D. Ill. 1937)

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Nature of the Case

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Facts

Ps were thirteen persons and the administrators of five deceased persons. Ps used to work for D. Ps allege that on July 28, 1930, the vice-president and general manager of D called the employees, who had rendered long years of service separately into his office and made with each a contract, to pay him, for the rest of his natural life, a sum equal to one-half of the wages he was then being paid. Ps contend that the consideration arose out of the relationship then existing, the desire to provide for the future welfare of these comparatively aged employees and the provision in the alleged contracts that the employees would call at the office for their several checks each pay-day. P were retained on the payroll, but, according to their testimony, they were not to render any further services, their only obligation being to call at the office for their remittances. The payments were made regularly until June 1, 1931, when they were cut off and advised by D's personnel officer that the arrangement was terminated. Ps sued D for breach of contract. D did not controvert most of the facts. D contends it sent a letter to each of the Ps. The letter stated that from the many years of faithful service, D was desirous of shielding them as far as possible from the effect of reduced plant operation and has placed them upon a retirement list which has just been established for this purpose. They were directed to report to the office for picking up checks, and their group insurance was to be maintained. D offered evidence that nothing was said to any P about continuing the payments for his natural life; that the payments were gratuitous, continuing at the pleasure and will of D; that the original arrangement was not authorized, approved, or ratified by the board of directors, the executive committee thereof, or any officer endowed with corporate authority to bind the company; that there was no consideration for the promise to make the payments; and that it was beyond the power of any of the persons alleged to have contracted to create by agreement or by estoppel any liability of the company to pay wages to employees during the remainders of their lives, if they did not render actual services. P's alleged estoppel and that there was a contract for the life of each person involved. It is undisputed that the letters sent out said nothing about how long the payments should continue.