General Mills, Inc. v. Hathaway , 694 S.W.2d 96 ( 1985 )

VANCE, Justice,

dissenting.

I respectfully dissent and would affirm the judgment of the trial court. Under L. G. Balfour Co. v. Brown, 110 S.W.2d 104 (Tex.Civ.App. — Fort Worth 1937, no writ), where an employer modifies an employment contract which is terminable at will the employee must elect either to terminate the contract by quitting or, by continuing to work, to accept the modifications. However, before the employee can be held as a matter of law to have accepted the modifications, the employer must establish that the employee unequivocally knew of the modifications. Stowers v. Harper, 376 S.W.2d 34, 39 (Tex.Civ.App.—Tyler 1964, writ ref’d n.r.e.). Knowledge of modifications to a contract is a question of fact to be decided by the jury. Stowers v. Harper, 376 S.W.2d at 39. Thus, this court cannot hold as a matter of law that Hathaway unequivocally knew of the modifications. Here, the jury evidently chose to believe Hathaway’s testimony that Gary Duncan previously represented himself to Hathaway and others as regional sales manager for General Mills and told Hathaway that he would “handle” the commission rate dispute and “not to worry” about it. Moreover, the jury apparently believed that Hathaway did not unequivocally know that General Mills had modified the contract and that Hathaway thought the commission rates were still in dispute. This is unlike the situation in Balfour, supra, where the employee was unequivocally notified of commission rate modifications by actually receiving a commission check based on the lower rates during his continued employment. Hathaway did not receive any commission payments based on the new rates until after General Mills fired him. We cannot substitute our belief on Hathaway’s knowledge for the jury’s in returning a verdict for Hathaway.

No special issue on Hathaway’s knowledge of the modifications was submitted to the jury and no written findings on it were made by the trial court. Because this omitted issue is necessary to Hathaway’s recovery on the original contract, this issue must be deemed to have been found by the trial court to support the jury verdict and judgment. We must deem that the trial court found Hathaway had no knowledge of the modifications. Harmes v. Arklatex Corp., 615 S.W.2d 177, 179 (Tex.1981); TEX.R.CIV.P. 279.

Thus, because the trial court is deemed to have found that Hathaway did not know of the modifications, he could not have accepted them. The old commission rates still applied and Hathaway is entitled to compensation based upon them. I would affirm the trial court’s judgment.