ALAN LESTER, APPELLANT,
v.
KAHN-MCKNIGHT COMPANY, INC., APPELLEE
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Florida appellate court reversed summary judgment for employer, holding that an employee's post-employment promise to repay commission draws lacks consideration and is unenforceable absent a specific undertaking to repay made at the time of employment.
A draw against commissions constitutes salary that an employee has no obligation to repay absent a specific undertaking to repay made at the time of employment, and a post-employment promise to repay lacks consideration and is unenforceable.
[1] A draw against commissions constitutes salary, and absent a specific undertaking to repay made at the time of employment, the employee has no obligation to return the dra…
Previewing 1 of 1 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“In the absence of a specific undertaking to repay the amount of a draw upon commissions — which did not exist here — the draw is considered as a plain and simple salary which, except as a set-off against earnings, the employee has no obligation to return.”
Court's statement of the legal rule governing commission draws and repayment obligations.
Lester was employed as a real estate salesman in early 1980 and received a $1,000 monthly draw against commissions. After six months without earning c…
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SCHWARTZ, Chief Judge.
Early in 1980, the appellant Lester was employed as a real estate salesman by the appellee Kahn-McKnight. He was given a $1,000 monthly draw “against commissions.” Six months later, having earned no commissions, Lester left Kahn-McKnight. He signed an agreement promising to repay the $6,000 he had received in draws. In the instant action, Kahn-McKnight sued and won a summary judgment for the $6,000. Lester appeals.
In the absence of a specific undertaking to repay the amount of a draw upon commissions — which did not exist here — the draw is considered as a plain and simple salary which, except as a set-off against earnings, the employee has no obligation to return. Tannen v. Equitable Life Ins. Co., 303 So. 2d 352 (Fla. 3d DCA 1974); see also Placet, Inc. v. Ashton, 368 So. 2d 404, 409-10 (Fla. 3d DCA 1979) (promise to pay draw against commissions in future requires payment of amount of draw even if commission is unearned), cert. denied, 378 So. 2d 343, 347 (Fla.1979). It follows that Lester’s post-employment written promise was supported by no consideration and was therefore unenforceable as a matter of law.
On this basis, the judgment below is reversed with directions to enter one in Lester’s favor. Reversed.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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Heim v. The Kessler Grp., Inc., 647 So. 2d 1039 (Fla. 3d DCA 1994)…was entitled to receive the full draw amount, even if overpaid, but was not entitled to be awarded additional commissions since the contract as construed by the trial court provided for a “draw against commissions.” See Lester v. Kahn-McKnight Co., 521 So. 2d 312, 313 (Fla. 3d DCA 1988); see also Maryland Casualty Co. v. Krasnek, 174 So. 2d 541 (Fla. 1965). Because the employer had paid out $47,119.00 in draws and the agent had earned commissions of $39,656.25, the sum of $7,462.75 was overpaid. Therefore, t…
Authorities Cited
- Tannen v. Equitable Life Ins. Co. of Wash., 303 So. 2d 352 (Fla. 3d DCA 1974)
- Vera-Nunez v. State, 368 So. 2d 404 (Fla. 3d DCA 1979)
- Placet, Inc. v. Ashton, 368 So. 2d 404 (Fla. 3d DCA 1979)