Court Opinion

ID: 9541527
Source: CourtListenerOpinion
Date Created: 2023-08-07 16:26:20.349438+00
Date Added: 2024-06-11T15:03:11.141959
License: Public Domain

Hunter, C. J.
(dissenting) — I dissent. From my examination of the record I am satisfied that a binding contract came into existence between the respondent and its employees under the outline of July 6th at the time the employees signed the enrollment card.
The record shows that on May 24, 1961, the executive committee for the respondent met and adopted a retirement plan which was to become effective July 1, 1961. The plan *282adopted, designated as plan 5, contained, as did all five of the proposed plans, the following vesting provision:
100% vested interest with 15 yrs of service & attainment of age 55 or 20 yrs’ service regardless of age.
On or about July 6, 1961, the respondent’s employees were given a 5-page document outlining the essential features of the retirement plan. That outline expressed virtually the same vesting provisions as set out above. It read as follows:
Termination op Service
If your service is terminated other than by death or retirement after you have attained the age of 55 and completed fifteen years of service or after twenty years of service regardless of age, you will receive, . . .
(Italics mine.)
The respondent, however, points out that the final paragraph of the 5-page outline terminated as follows:
This descriptive material is for the purpose of outlining the more important features of the Plan. The actual Plan is subject to the terms and conditions of the formal Plan and Trust instrument.
Nevertheless, the employees were instructed to accept or reject the offer at that time by either signing the attached enrollment card or the employee waiver and release. In addition, immediate salary deductions were withdrawn from the wages of those employees who did accept the offer by enrolling. At that time the employees were thereby forced to either join the plan and commence making contributions or waive their rights to ever join it. The waiver and release card provided:
It is understood that no other retirement plan will be made available to me through my employer. All rights and privileges to which I would have been entitled under the Washington Employers, Inc. Retirement Plan are hereby waived and Washington Employers, Inc. is released from any and all liability with respect to me under said Retirement Plan.
On or about July 10, 1961, the appellant George Leonard completed and returned the enrollment card and com*283menced immediate contribution toward the retirement plan from his salary.
I am satisfied that at this point a contract between the appellant and the respondent came into existence. In Fuller v. Ostruske, 48 Wn.2d 802, 807, 296 P.2d 996 (1956), this court stated:
If the terms of a contract are agreed upon and the intention of the parties is plain, then a contract exists, even though one or both of the parties may have contemplated that a more formal contract would be executed subsequently. Loewi v. Long, 76 Wash. 480, 136 Pac. 673; Washington Dehydrated Food Co. v. Triton Co., 151 Wash. 613, 276 Pac. 562.
The subsequent, formalized plan drafted and adopted by the respondent changed the time of vesting from “years of service” to “years of credited service.” This constituted a substantive change of the contract by unilateral act, contrary to the manifest intent of the parties. As this court recently stated in Plumbing Shop, Inc. v. Pitts, 67 Wn.2d 514, 517, 408 P.2d 382 (1965), Washington follows the objective manifestation theory in construing alleged contracts:
The Washington court has long adhered to the objective manifestation theory in construing the words and acts of alleged contractual parties. We impute to a person an intention corresponding to the reasonable meaning of his words and acts. Unexpressed intentions are nugatory when the problem is to ascertain the legal relations, if any, between two parties. Washington Shoe Mfg. Co. v. Duke, 126 Wash. 510, 218 Pac. 232, 37 A.L.R. 611 (1923).
The objective manifestation of the retirement plan placed before the employees in July can be found only in the outline, irrespective of the more “formal” November draft.
The respondent contends that the July outline, by calling for a formal plan, contemplated material changes to the contract. I cannot agree. Such an interpretation would create an illusory contract, allowing the respondent to make material changes at its wish or whim. The objective intent of the contracting parties was expressed by the July outline, upon which the employees were told to either accept *284or reject, and not by the language unilaterally supplied at a much later date by the respondent when it drafted the formal plan. Any other interpretation would be construing the pension plan, as drawn up by the employer, in favor of the employer and against the employee. A pension plan may not be so construed. As the court said in Frietzsche v. First Western Bank & Trust Co., 168 Cal. App. 2d 705, 707, 336 P.2d 589 (1959):
Pension plans are to be liberally construed in favor of the employee. (Klench v. Board of Pension Fund Commrs. (1926), 79 Cal.App. 171, 186 [249 P. 46].)
The general rule is that pension plans, formulated by an employer, are construed most strongly against the employer. (Sigman v. Rudolph Wurlitzer Co. (1937), 57 Ohio App. 4 [11 N.E.2d 878, 879].)
I would therefore reverse.
Rosellini and Hale, JJ., concur with Hunter, C. J.
March 3,1970. Petition for rehearing denied.