9.4
Dr. Vranich hired a new employee, Dennis Winkle to help assist with Dr. Vranich’s practice. A year into Dennis signing on to work for Doctor Vranich, they entered into a verbal agreement to increase Dennis’ salary and introduce a profit-sharing bonus. This was an oral agreement, unlike the contract that Dennis agreed to and signed when he originally accepted the position. After a disagreement, Dennis tried to sue Dr. Vranich for the lack of payment on the profit-sharing plan.
The terms of the agreement were very clear. He received the salary increase as agreed to, so why is Dennis not also entitled to the profit-sharing bonus? The woman towards the end of the video that was viewed this week in the lecture notes, Nancy Kubasek, discusses how a handshake is no substitute for a written contract. From this week's lecture, "In the Middle Ages, contracts between members of the privileged classes did not require consideration because a man's word was his bond." Contracts have evolved a long way since the Middle Ages, and unfortunately you cannot rely on a man's word, in most cases. However, under Montana law, a written contract can be altered only in writing or by an executed oral agreement.
In this particular case, Dennis should receive the profit sharing bonus. They entered into and executed an oral agreement, and under Montana law that agreement is protected. The fact that Doctor Vranich gave Dennis the salary increase, only further backs up Dennis’ case. If that salary increase was not given, Doctor Vranich would have a much better case, and it would be hard for Dennis to prove the agreement since nothing was in writing. Luckily for Dennis, he can show evidence (pay stubs) that he received the agreed to pay raise. Ethically, Dr. Vranich is trying to protect herself, and the fact that no contract was ever signed is an ethical defense of her part. The