## Facts

- Rio Grande Pickle Co., Inc. employed George Fujimoto as supervisor of planting and growing operations and Jose Bravo as labor recruiter.
- To retain them, the company offered compensation including a profit-sharing bonus described as “ten per cent of the company’s annual profits,” later memorialized in written instruments.
- The written instruments promised each employee “a bonus amounting to ten per cent of the company’s net profits for each fiscal year” and required each to return half the bonus as an investment in company stock.
- The written offers did not state how acceptance had to be made or communicated.
- Fujimoto and Bravo signed the written instruments but did not return the signed copies to the company; they continued working until November 30, 1966, believing the bonus terms governed their employment.
- The employees sought unpaid bonuses for the fiscal year ending September 30, 1966, and for October–November 1966.

## Issues

1. Whether written bonus offers that did not specify a mode of acceptance could be accepted by conduct (continued employment) rather than by returning signed instruments.
2. Whether the jury was properly instructed on how to compute “net profits” for a partial post–fiscal-year period, including whether prior fiscal-year losses must be considered.

## Decision

- The Fifth Circuit affirmed the jury’s finding that enforceable written contracts existed and that the employees accepted the offers.
- The court held there was substantial evidence the company did not require return of the signed instruments as the exclusive method of acceptance and that continued employment reasonably manifested assent.
- The court reversed the damages determination as to the October–November 1966 bonus calculation and remanded for further proceedings.
- The court held the district court’s “net profits” instructions for the post–fiscal-year period were erroneous because they did not permit consideration of prior-year losses as required by the contract’s proper construction.

## Legal Principles

- When an offer does not prescribe an exclusive method of acceptance, acceptance may be made by any reasonable manner that clearly manifests assent, including conduct.
- Acceptance need not be written or oral; nonverbal acts can communicate assent if they objectively indicate intent to accept the specific offer and the offeror has reason to understand the acceptance.
- Profit-sharing clauses tied to “net profits” are construed in light of the contract’s purpose and commercially reasonable accounting concepts; for partial periods, profits may not be calculated by isolating revenues without accounting for relevant losses where the agreement, properly interpreted, requires such treatment.

## Conclusion

The court enforced the employees’ bonus contracts because the employer’s unspecified acceptance terms permitted acceptance by continued performance, but it ordered a remand to recompute any bonus owed for the partial post–fiscal-year period under correct “net profits” instructions that accounted for prior losses.


Fujimoto v. Rio Grande Pickle Co., 414 F.2d 648 (5th Cir. 1969)