## Facts

- Rose Acre Farms operated voluntary employee bonus programs intended to reduce tardiness and absences and increase dependability.
- A consistent term across programs required perfect attendance: no tardiness and no missed work for any reason, including illness; missed work could be “made up” only if completed within the same week, otherwise the bonus was forfeited.
- Mark Dove, a Rose Acre employee working on a construction project, accepted a project-completion bonus offer initially described as $6,000 for completion within 12 weeks, later modified to $5,000 for completion within 10 weeks to accommodate his school schedule.
- Dove understood the agreement required five full workdays per week during the 10-week period and that any tardiness or absence would forfeit the bonus.
- Dove worked nine full weeks but became ill (strep throat and high fever) near the end of the tenth week and missed two days.
- Rose Acre’s president offered Dove the option to rest on site or make up missed time on the weekend, but Dove declined and did not make up the missed days within the week.
- Rose Acre refused to pay the bonus due to Dove’s failure to meet the attendance requirement.
- After a bench trial, the Decatur Circuit Court entered judgment for Rose Acre, finding Dove did not prove satisfaction of the contract conditions; Dove appealed.

## Issues

1. Whether the bonus agreement’s no-absence/no-tardiness requirement was an express condition precedent requiring strict compliance, such that missing two days defeated Dove’s claim to the bonus.
2. Whether the doctrine of substantial performance could excuse noncompliance with the strict attendance term and permit recovery.
3. Whether Dove’s illness rendered performance impossible so as to excuse nonoccurrence of the condition and support an affirmative claim for the bonus.

## Decision

- The Indiana Court of Appeals affirmed the judgment for Rose Acre Farms.
- The court held the strict attendance requirement was an express condition precedent to the employer’s duty to pay the bonus.
- Because Dove missed work and did not make up the missed days within the required time, the condition did not occur and Rose Acre’s duty to pay never arose.
- Substantial performance did not apply because the disputed term was an express condition, not a mere promise.
- Impossibility did not entitle Dove to payment because impossibility operates as a defense to liability rather than a basis for affirmative recovery where a condition precedent has failed.

## Legal Principles

- When parties create an express condition precedent to payment, strict compliance is required; substantial performance does not satisfy an express condition.
- Clear, unambiguous contract terms knowingly accepted by the parties are enforced even if enforcement results in forfeiture for the noncomplying party.
- Voluntary participation and demonstrated understanding of strict bonus conditions support enforcement of those conditions as written.
- The doctrine of impossibility generally excuses a duty to perform or serves as a defense; it does not create a right to payment when a contractual condition precedent to payment has not occurred.
- Absent fraud, bad faith, or a developed public-policy basis to refuse enforcement, courts will apply strict conditions in incentive/bonus contracts according to their terms.

## Conclusion

The court enforced the bonus plan’s strict attendance condition as an express condition precedent and denied recovery because Dove missed work during the bonus period and did not satisfy the condition; neither substantial performance nor impossibility justified payment of the bonus.


Dove v. Rose Acre Farms, Inc., 434 N.E.2d 931 (Ind. Ct. App. 1982)