Mgmt 597 Week 1 Assignment

In: Business and Management

Submitted By vmontalvo
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Week 1 Assignment

9.4
Loren Vranich, a doctor practicing under the corporate name Family Health Care Business Ethics, P.C., entered into a written employment contract to hire Dennis Winkel. The contract provided for an annual salary, insurance benefits, and other employment benefits. Another doctor, Dr. Quan, also practiced with Dr. Vranich. About nine months later, when Dr. Quan left the practice, Vranich and Winkel entered into an oral modification of their written contract whereby Winkel was to receive a higher salary and a profit-sharing bonus. During the next year, Winkel received the increased salary. However, a disagreement arose, and Winkel sued to recover the profit-sharing bonus. Under Montana law, a written contract can be altered only in writing or by an executed oral agreement. Dr. Vranich argued that the contract could not be enforced because it was not in writing. Does Winkel receive the profit-sharing bonus? Did Dr. Vranich act ethically in raising the defense that the contract was not in writing? Winkel v. Family Health Care, P.C., 205 Mont. 40, 668 P.2d 208, Web 1983 Mont. Lexis 785 (Supreme Court of Montana)

Does Winkel receive the profit-sharing bonus?
Answer:
The problem here is that Dr. Vranich doesn’t believe that she should have to enforce a verbal agreement in which she entered in with Winkel for the profit-sharing bonus, but Montana law says that it should be honored. Yes, Winkel gets the profit-sharing bonus. Because in the state that the contract was made it entitles Winkel to receive the profit-bonus without a written contract as a verbal contract is binding as well. The original contract, when written, says nothing about the raise and the profit-share. Unfortunately for Dr. Vranich because she went into an oral modification of the written contract, Montana State upholds oral obligation therefore, Dr. Vranich needs to pay…...

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