Plowman v. Indian Refing Co.

University:
Eastern Kentucky University
Course:
LGS 300 | Introduction to Legal Studies
Academic year:

2020
Views:

302

Pages:

1
Author:

Marilyn James

Plowman v. Indian Refing Co. United States District Court 1937 Facts: Employees were called into manager’s office and told they would be paid for the rest of their life if they retired and took half of their salary. The company would still be participating in the insurance and be retained on payroll. One year later the payments stopped and the office said they would not longer be paying them. The defendant doesn’t testify the facts other than they never agreed to pay them for life. The plaintiffs filed a suit against the company Arguments: The plaintiffs argue that the defendant breached a contract they had reached. The defendants argue that they had no authority to make a deal. Also, the defendants argue there was no consideration. Procedural History: The plaintiffs filed suit against the defendants for breach of contract. Issues: 1) Did the manager have the authority to make the contract? a: The company bylaws stated that the defendants could not create such an agreement on their own. 2) Was there consideration? a. Holding: There was no consideration for the contract. The past actions of one cannot count as consideration for a contract in front of them. Also, there was no detriment to the employees. Collecting their paycheck from the office was routine and posed no detriment to them. Moral obligation, which the company should feel, does not create a legal duty to the employees to continue to pay them. Judgment: The court rules in favor of the defendant.