Mary Ellen Cook worked as an independent-contractor real estate salesperson for Coldwell Banker/Frank Laiben Realty Co. In March 1991, the firm announced an oral bonus program to retain agents and compete with other brokerages. Agents who earned $15,000 in commissions would receive $500 immediately; those earning between $15,000 and $25,000 would receive a 22 percent bonus; and those earning above $25,000 would receive a 30 percent bonus. Amounts beyond the initial $500 were to be paid at year-end.
Cook earned more than $15,000 by April 1991 and received the promised $500 in September. By the September sales meeting, she had earned more than $32,400. At that meeting, Frank Laiben stated that bonuses would instead be paid at a banquet the following March and indicated that agents had to remain with the firm until then to collect. Cook testified that she had intended to remain through 1991 in reliance on the original bonus promise, but accepted a position with another brokerage in January 1992. Laiben then told her she would receive no further bonus.
By the end of 1991, Cook had earned $75,638.47 in commissions, which qualified her for a combined bonus of $17,391.54. After the firm refused her demand for payment, Cook sued for breach of the bonus agreement and prejudgment interest. A jury awarded her $24,748.89, and the trial court entered judgment on that verdict. The brokerage appealed.
Issue #1
Whether Cook made a submissible case that she accepted the original bonus offer and supplied consideration before the brokerage attempted to alter or revoke it.
Holding
Yes. The evidence permitted the jury to find that Cook accepted the unilateral bonus offer through performance and that her substantial performance made the offer irrevocable before the September modification.
Reasoning
The March announcement was an offer for a unilateral contract: the brokerage promised a bonus in exchange for an at-will agent's continued work and commission production. In such a contract, the promisor does not initially receive a return promise. Consideration arises, and the offer is accepted, when the offeree performs the requested acts with the intent to accept the offer.
Cook presented evidence that the promised bonus induced her to stay with the brokerage through 1991 and to generate substantial commissions. She had no contractual obligation to remain with the firm or to reach any specified production level, so her continued work and sales could constitute the requested performance rather than conduct she was already legally bound to undertake.
Before the September meeting, Cook had remained with the firm and earned more than $32,400 in commissions, enough to qualify for the highest bonus tier. This evidence supported a finding of substantial performance. Under Missouri law, an offeror generally may revoke an unaccepted offer, but may not revoke an offer for a unilateral contract after the offeree has substantially performed in justified reliance on it.
The evidence also supported each remaining element of breach: the firm offered a year-end bonus, Cook performed with the intent to accept, the firm knew of her performance and paid the initial $500, yet it refused to pay the remaining earned amount. Reasonable jurors could find a breach, so a directed verdict was improper.
Issue #2
Whether the verdict-directing instruction was defective because it did not require a separate jury finding of consideration.
Holding
No. The instruction properly required a finding that Cook performed the acts called for by the offer with intent to accept it; no separate consideration finding was required.
Reasoning
The instruction followed Missouri Approved Instruction 26.01 for breach of a unilateral contract. Performance undertaken with intent to accept supplies the consideration necessary to make a unilateral promise enforceable.
The brokerage's other complaints about the instruction were not preserved. It did not object at trial to the use of the pronoun “he” in referring to Laiben, and it did not develop its complaint that “performance” lacked a definition in the argument portion of its appellate brief.
Issue #3
Whether the trial court improperly barred defense counsel from arguing lack of consideration during closing argument.
Holding
No. The court did not plainly err because it allowed counsel to argue that Cook had not performed the acts required by the bonus offer, while preventing reliance on an undefined legal term not used in the jury instructions.
Reasoning
The brokerage's point relied on failed to explain wherein and why the ruling was erroneous, leaving the claim unpreserved. The appellate court nevertheless reviewed for plain error and found none.
The trial judge permitted the brokerage to argue from the evidence that Cook did not do what the offer required and therefore was not entitled to recover. The court merely asked counsel not to frame that factual argument in terms of “consideration,” because the verdict director asked the jury to decide performance with intent to accept, not an abstract and undefined consideration issue.
If the jury found the elements submitted in the verdict director, consideration followed from Cook's performance. Thus, the restriction did not prevent the brokerage from contesting the facts relevant to its defense.
Issue #4
Whether the trial court erred in overruling the brokerage's objection to Cook's closing argument that she had to fight to receive her initial $500 bonus.
Holding
No. The argument was a reasonable inference from the evidence, and any challenge to the court's accompanying comment was not preserved.
Reasoning
Cook's counsel argued that she had to fight for the initial $500 bonus because she earned it in April 1991, the program said it was payable immediately, and the brokerage did not pay it until September. Those facts supported a reasonable inference that obtaining the payment was difficult or contested.
The brokerage did not object to the judge's statement that the jury could draw a reasonable inference, nor did it request a mistrial. Its appellate point also failed to state wherein and why the ruling was erroneous. The court found no plain error.
Issue #5
Whether the brokerage should have been allowed to introduce evidence of its own losses to cure prejudice from testimony that it retained 43 percent of agents' sales commissions.
Holding
No. The curative-admissibility argument was unpreserved and, in any event, did not apply because the commission-structure testimony was relevant and admissible.
Reasoning
The brokerage did not assert curative admissibility when it sought to introduce its earnings evidence at trial or in its motion for new trial. It could not advance that new ground for admission for the first time on appeal.
Curative admissibility allows a party to answer inadmissible evidence introduced by its opponent with similar evidence when necessary to cure unfair prejudice. Laiben's testimony that the brokerage retained 43 percent of agents' sales described the firm's commission structure and was relevant evidence, not inadmissible evidence that opened the door to proof of the firm's overall financial losses.
Issue #6
Whether the trial court improperly excluded evidence that other brokerage bonus plans, on which the firm allegedly modeled its program, paid bonuses in March.
Holding
No. The evidence was irrelevant to the disputed terms of the parties' agreement, and the brokerage's alternative curative-admissibility theory was unpreserved.
Reasoning
The contested factual question was what the brokerage actually communicated at the March 1991 meeting: whether bonuses were due at the end of that year, as Cook testified, or in the following March, as Laiben testified. The firm's private motivation, prior experience, or reliance on other companies' bonus plans did not establish the terms conveyed to Cook.
Custom-and-usage evidence may sometimes assist in interpreting an ambiguous contract, but no ambiguity in a written or otherwise established contractual term was at issue here. The evidence concerning other firms' payment schedules therefore did not bear on the central dispute.
The brokerage did not raise curative admissibility as a basis for admitting this testimony at trial or in its new-trial motion, and it identified no inadmissible evidence introduced by Cook that required a curative response. The trial court acted within its discretion in excluding the testimony.