New England Homes, Inc. v. R. J. Guarnaccia Irrevocable Trust

Summary

The New Hampshire Supreme Court reviewed consolidated appeals concerning unpaid commissions and liquidated damages awarded to former regional sales managers under New Hampshire wage statutes. The court held that commissions were earned when the employer accepted the orders, rejected the challenge to one commission award, ordered consideration of a volume discount in calculating another award, and reversed the liquidated-damages awards because the employer had a bona fide belief that no commissions were owed. The case was affirmed in part, reversed in part, and remanded.

Holdings

1. A commission-based employee who solicits sales orders is generally entitled to a commission when the employer accepts the order, even if payment is delayed until after shipment or delivery. The parties may alter that rule only through a written agreement or conduct that unambiguously establishes a different compensation scheme. New England Homes's Letter of Understanding and conduct did not unambiguously alter the rule.
2. The Superior Court did not pierce the corporate veil by including the Donahue Realty Trust home in calculating Guarnaccia's commission; the evidence supported the finding that Guarnaccia sold the home on behalf of New England Homes.
3. The Superior Court erred by refusing to consider New England Homes's volume-discount schedule because the hearing record had expressly been left open for that evidence and the schedule was filed before the deadline.
4. Liquidated damages were improper because New England Homes had a bona fide belief, based on the ambiguity in the Letter of Understanding, that it did not owe the commissions. An employer cannot have acted willfully and without good cause when its refusal to pay wages rests on such a bona fide belief.

Questions Presented

1. Whether commissions were earned when New England Homes accepted the employees' orders or only when the homes were later delivered and paid for.
2. Whether the commission award properly included Guarnaccia's sale of a home owned by Donahue Realty Trust.
3. Whether the Superior Court erred by excluding a timely submitted volume-discount schedule when calculating Cooley's commissions.
4. Whether New England Homes acted willfully and without good cause so as to justify liquidated damages under RSA 275:44, IV.

Disposition

reversed_and_remanded