On appeal from the Superior Court of New Jersey, Law Division, Morris County.
Approved for Publication February 12, 1997. As Corrected March 5, 1996. As Amended April 21, 1997. As Corrected April 28, 1997.
Before Judges Michels, Muir, Jr. and Coburn. The opinion of the court was delivered by Michels, P.j.a.d.
The opinion of the court was delivered by: Michels
The opinion of the court was delivered by
The plaintiff David Kopin appeals from a summary judgment of the Law Division in favor of defendant Orange Products, Inc. that dismissed his action to recover damages on a theory of quantum meruit for business suggestions he made while employed by defendant.
Accepting plaintiff's proofs presented on the summary judgment motion, it appears that defendant was in the business of manufacturing plastic balls used in roll-on deodorants. Defendant built its own grinding machines to produce the balls. Plaintiff's principal responsibility was to make, install, repair, and replace the various sized grinding wheels used in the grinders to shape the plastic balls. On occasion, plaintiff made other parts for the machines and worked as a machinist. While plaintiff admits that it was part of his job to improve his efficiency and techniques as a machinist, he claims that before March 1986 he never created any major improvements or designs for the grinding machines. Instead, he contends that he only made minor improvements that increased the quality of his work. Plaintiff maintains that significant alterations to the grinders were the engineer's responsibility and never part of his job requirements.
Plaintiff, however, admits recommending some major changes regarding the grinding machines prior to March 1986. For instance, in 1977 plaintiff suggested that certain parts for the grinders be made of stainless steel so that they would last longer. Plaintiff notes that at the time he did not expect extra remuneration because he had never been promised any extra compensation for his suggestions; he felt that the suggestions made his position more secure and were actually part of his job. Additionally, in 1977 or 1978, plaintiff suggested two other major modifications: a new flange design for the big grinders and a new holder for certain "worm" gears on the grinders. According to plaintiff, his supervisor told him that he should just worry about the grinding wheels and let the supervisor worry about the machines. Plaintiff interpreted the supervisor's comments as instructing him not to make any more recommendations; hence, plaintiff stopped making such suggestions after 1978.
In March 1986, defendant was purchased by S. Paul Sachdev and Mario Verdi. Soon after acquiring defendant, Sachdev and Verdi held a meeting with plaintiff and other employees. According to plaintiff, Verdi declared at the meeting that
if anybody . . . comes to us [Sachdev and Verdi] and makes an improvement to our operation, or how we can make more money, or what we can do with the equipment and we use it and it works for us [that person will] be financially remunerated.
According to plaintiff, Verdi motioned to the maintenance man to emphasize his point, stating, "If Bob[,the maintenance man,] comes up with the idea . . . he will be rewarded." Diane Furey Whitehead, a machinist who was at the meeting, reported that her father, a supervisor with defendant, asked Sachdev if this promise was true, and Sachdev replied, "Yes, you would be taken care of." Throughout the remainder of plaintiff's employment, Sachdev and Verdi never retracted this offer. Neither owner, however, ever stated what remuneration an employee would receive for a useful suggestion.
Soon after the meeting, Sachdev and Verdi fired plaintiff since they believed that plaintiff's work did not require a full-time employee and that such work could be assimilated into another employee's duties. Yet, it was soon determined that another person could not be trained to do plaintiff's work and that no other employee was willing to do it. Thus, defendant rehired plaintiff.
In late 1986 or early 1987, plaintiff suggested to his supervisor that the flange design used on smaller grinders be adopted for the larger grinders. Plaintiff thought that the new flange design would prevent the water used in operating the grinders from coming in contact with the bearings, and thereby prevent the bearings from wearing out as quickly. Plaintiff presented this idea to his supervisor and one of the owners for months before they finally decided to try the new flange. First, the flange was tried on only one large grinder, and defendant discovered that the bearings lasted about four times longer than before. Then, after several more months, defendant changed the flanges on all the large grinders so that by the middle of 1988 each had the new flange.
Plaintiff claims that the new flange produced three benefits for defendant. First, it reduced labor and parts costs since the bearings were changed less frequently. Second, it extended the lives of the grinding wheels. And, third, it increased the production of plastic balls since the machines did not need to be fixed as often. Plaintiff contends that as a result of this suggestion, defendant's sales were greatly increased because production was dramatically increased.
In 1989, plaintiff recommended to defendant a new feeding hopper design for the large grinders. The hoppers were devices attached to the grinders through which plastic blanks, the raw material which was eventually ground into plastic balls, were fed into the grinder. The hoppers had seven openings, but the blanks were slightly larger than the openings, so that blanks would get caught in them. Consequently, only three to six blanks, rather than seven, would fall in at a time. As a result, less balls were produced and the life of the grinding wheels were reduced due to uneven wear. In addition, the seven openings could not be further enlarged since they were too close together. Plaintiff proposed that a new hopper with six larger openings be built. Defendant adopted plaintiff's suggestion in September of 1989 and, according to plaintiff, was again able to increase its plastic ball production and profits.
In late 1989 or early 1990, plaintiff suggested that a mounting device for a worm gear, which frequently broke, be replaced with an inexpensive, sturdy screw. Plaintiff claims that this suggestion increased profits by saving substantial labor and parts costs. Plaintiff also suggested that the large grinders use heat-treated gear teeth. These sturdier teeth were used. Plaintiff asserts that this suggestion saved defendant money because the machines needed less repair.
Further, defendant adopted plaintiff's suggestion that a silicone compound be spread over the bearings to prevent any moisture from reaching the bearings. Plaintiff contends that this advice also helped defendant increase production. Finally, plaintiff submitted two further improvements which defendant accepted. First, he designed a device which made the heads on the grinders interchangeable and, thus, easier to replace when broken. Second, he replaced an air mechanism which controlled the opening and closing of the hoppers with latches, a mechanical device which was more dependable. There was also evidence that prior to implementing plaintiff's suggestions, defendant's maximum output per shift was forty-nine drums of plastic balls, and that as a result of plaintiff's recommendations, production increased to seventy-one drums per shift, and saved defendant labor and material costs.
Defendant, on the other hand, claims that plaintiff's suggestions did not lead to any increased profits. Instead, Sachdev attributes defendant's success to a lapper, a new product purchased in 1991 which allegedly helped produce more acceptable plastic balls. Sachdev contends that prior to plaintiff's suggestions, plaintiff's grinding department accommodated all the balls produced by the seal-welding and molding departments. Thus, defendant maintains that any improvements in the grinding department did not increase its actual output since the grinding section was already producing more balls than the other sections could provide prior to plaintiff's recommendations. Sachdev, however, did add a third shift to the grinding department in 1990. Finally, Sachdev claims that defendant lost more than $800,000 between 1986 and 1989.
While employed by defendant, plaintiff was paid his agreed upon wages and received regular pay increases. Plaintiff also received bonuses at the end of every year in the amount of $100 as well as payments of $1,500 in a few years in lieu of participating in a pension plan. Plaintiff suggests that most employees received the same yearly bonuses even though they did not make helpful recommendations.
Prior to 1991, plaintiff never mentioned to Sachdev or Verdi that he wanted any financial remuneration for his suggestions. Plaintiff states that he hesitated approaching Sachdev or Verdi directly because he was afraid of retaliation. Nevertheless, plaintiff claims that he told his supervisor on several occasions that he (plaintiff) should receive some reward for his suggestions. Plaintiff asserts that when he told his supervisor of his desire for financial compensation, his supervisor ...