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2004-UP-423 - Gilmore v. Holiday Network


In The Court of Appeals

Brenda C. Gilmore, Teresa Ann Moore, Sena Austin Pearl, Susan Marie Buksa, Sharon Williams Ford, Rolanda Patice Lewis, Mary Kate Green, Kari Anne O'Keefe, Jan Lynn McWells, Deborah Ann Cooke, Robert James Phillips, Joye Denise Rymar, Steven Michael Poth, Lisa Ann McIntyre, Robert Warham, Jennifer Percy, Yvonne Cox, Caroline Carmichael, Michele Tholen, Paul Fulton, John Sparozic, Peggy Graham, Regina Brandon, Stephanie Foresterio, Charalene Harris, Betty Phillips Nichole Kathleen Lambert, Karen Rochelle Lee, Lisa Michelle Cox, Wilbert Thomas Grissett, Tastonia Michelle Myatt, Michael Katen, Sondra L. Katen, Joann Morris, Beth Fogle, and Michelle Ventura,        Respondents,


Holiday Network Int., Inc., DEI Marketing, Holiday Network Int. of GA, Inc., Dan McGeown, Susan McGeown, Scott McLaren and Dan Carmichael,                        Defendants,

Of whom Dan McGeown and Scott McLaren are the,        Appellants.

Mary Thaggard, Dena Pearl, Dessie Coates, Julianna Boundy, James E. Cameron, Lisa J. Fera, Brad McCray, Ashley Rowell, Judy Carayiannis, Patricia Hanick, Frank Cross, Megan Weber, Jay Baker, Carol Shanks, Joanne Mianti, et al., on behalf of themselves and all other similary situated,        Respondents,


Holiday Network Int., Inc., DEI Marketing, Holiday Network Int. of GA, Inc., Dan McGeown, Susan McGeown, Scott McLaren, and Dan Carmichael,        Defendants,

Of Whom Dan McGeown and Scott McLaren are the,        Appellants.

Appeal From Horry County
J. Stanton Cross, Jr., Master-In-Equity

Unpublished Opinion No. 2004-UP-423
Submitted June 8, 2004 – Filed June 30, 2004


Fred B. Newby and C. Scott Masel, of Myrtle Beach, for Appellants.

Gene McCain Connell, Jr. and Norwood David DuRant, both of Surfside Beach, and Richard S. Joye, of Murrells Inlet, for Respondents.

PER CURIAM:  Dan McGeown and Scott McLaren appeal the trial court’s order holding them individually liable to employees of a closed business for unpaid wages under the South Carolina Payment of Wages Act and theory of promissory estoppel.   We affirm in part and reverse in part. [1]      


This case arises after the sudden closing of Holiday Network International, Inc.  McGeown was the president and owner of Holiday Network.  McGeown did not live in state, but would visit the Myrtle Beach office every couple of months for approximately a week’s duration.  McGeown signed the payroll checks and generally ran the business without regard to corporate formalities.  McLaren was the vice president, marketing director, and effectively acted as the “boss” at the Myrtle Beach location when McGeown was absent.  After the close of Holiday Network, McLaren was transferred to a business owned by McGeown in Florida. 

When Holiday Network suddenly closed, the employees were left without payment for wages due.  These employees were to have been paid the last day the business operated, a Friday.  However, McLaren explained to them payment was late due to a delayed Federal Express delivery.  McLaren told employees if any of them were in desperate need of money prior to Monday, they could come to his house and he would sell his golf clubs to give them money from the sale.  At least one employee testified he went to McLaren’s house to accept his offer, but McLaren did not answer the door. 

On Sunday, McGeown told the bookkeeper that he would personally see that everyone was paid.  This same employee testified that in her capacity as bookkeeper, she relayed this information to all of the employees who called her home.  Many other employees also testified as to direct communication between themselves and McGeown and his promise they would be paid.  Others testified they tried to contact McGeown in Florida, but could never speak to him personally.  Holiday Network was closed that Monday. 

Left without wages they had earned, the employees filed suit against the Holiday Network, McGeown, and McLaren.  The circuit court granted the employees partial summary judgment, declaring that they were employees of Holiday Network as a matter of law.  The case subsequently was referred to the master-in-equity for trial.  The trial court held McGeown and McLaren liable for the unpaid wages under a theory of promissory estoppel and pursuant to the South Carolina Payment of Wages Act.  S.C. Code Ann. § 41-10-10 et seq.  In addition, the court trebled the damages and awarded attorney’s fees pursuant to the statute.  S.C. Code Ann. § 41-10-80(C) (Supp. 2003).


When legal and equitable actions are maintained in one suit, each retains its own identity as legal or equitable for purposes of the applicable standard of review on appeal.  Corley v. Ott, 326 S.C. 89, 485 S.E.2d 97 (1997).  An action for promissory estoppel is equitable in nature.  West v. Newberry Elec. Co-op., 357 S.C. 537, 542, 593 S.E.2d 500, 502 (Ct. App. 2004).  Thus, in reviewing the action for promissory estoppel, we may determine facts in accordance with our own view of the preponderance of the evidence.  Jocoy v. Jocoy, 349 S.C. 441, 444, 562 S.E.2d 674, 675 (Ct. App. 2002).  However, we are not required to disregard the findings of the trial court, which saw and heard the witnesses and was in a better position to evaluate their credibiliy.  Id.  In the action pursuant to the South Carolina Payment of Wages Act, which is an action at law, this court’s scope of review extends only to the correction of errors of law.  See Evans v. Taylor Made Sandwich Co. 337 S.C. 95, 101, 522 S.E.2d 350, 353 (Ct. App. 1999) (stating factual disputes under the Payment of Wages Act are to be determined by a jury); Sims v. Hall, 357 S.C. 288, 294, 592 S.E.2d 315, 318 (Ct. App. 2003) (stating the standard of review for an action at law).  The factual findings of the trial court will not be disturbed on appeal unless a review of the record reveals there is no evidence which reasonably supports the court’s findings.  Sims, at 294-95, 592 S.E.2d at 318.


1.     Promissory Estoppel

McGeown and McLaren argue the trial court erred in finding liability against both of them based on a theory of promissory estoppel. 

A successful claim under promissory estoppel requires four elements: (1) the presence of a promise unambiguous in its terms, (2) reasonable reliance upon the promise by the party to whom the promise is made, (3) the reliance is expected and foreseeable by the party who makes the promise, and (4) the party to whom the promise is made must sustain injury in reliance on the promise.  Satcher v. Satcher, 351 S.C. 477, 483-484, 570 S.E.2d 535, 538 (Ct. App. 2002).  “The applicability of the doctrine [of promissory estoppel] depends on whether the refusal to apply it ‘would be virtually to sanction the perpetration of a fraud or would result in other injustice.’”  Id.  at 484, 570 S.E.2d at 538 (citation omitted).

McLaren was not the owner of Holiday Network; instead he only managed the Myrtle Beach operation during McGeown’s absence.  Although he made representations to some of the other employees that they would be paid, McLaren neither had control over the actual signing and sending of these paychecks nor did he personally assume any obligation.  The employees place much emphasis on McLaren’s offer to sell his golf clubs and pay any employees that could not wait for their paycheck.  However, it would be inequitable to use this offer of charity to impose liability on McLaren personally.

As to the claims against McGeown, the employees presented testimony that McGeown promised them that they would be paid.  According to the bookkeeper, he assured her that he would personally see to everyone being paid.  She then relayed this assurance to other employees.  Although the employees presented this testimony as evidence of McGeown’s promise to personally pay them, they did not present any evidence of any injury caused by reliance on this promise. 

According to the testimony, the earliest McGeown made the promise to pay was the last day Holiday Network operated, a Friday.  There is no evidence any employee continued working in reliance on either McGeown or McLaren’s promises.  In fact, the next business day, a Monday, Holiday Network was closed.  As the employees did not establish every element of promissory estoppel, their cause of action based on this theory must fail. 

2.     South Carolina Payment of Wages Act

a.  Liability under the South Carolina Payment of Wages Act

McGeown and McLaren argue they were not employers who knowingly permitted the corporation to violate the South Carolina Payment of Wages Act.  We affirm as to McGeown and reverse as to McLaren.

The South Carolina Payment of Wages Act provides “every employer in the State shall pay wages due. . .”  S.C. Code Ann. § 41-10-40(A) (Supp. 2003).  The statute further defines an “employer” as a “corporation . . . and any agent or officer of the above classes employing any person in this State.”  S.C. Code Ann. § 41-10-10(1) (Supp. 2003).  As this court explained, “the legislature intended to impose individual liability on agents or officers of a corporation who knowingly permit their corporation to violate the Act.  To hold otherwise would require us to ignore the words ‘and any agent or officer of the above classes.’” Dumas v. Infosafe Corp., 320 S.C. 188, 195, 463 S.E.2d 641, 645 (Ct. App. 1995) (emphasis added).  In Dumas, the court imposed individual liability under the Payment of Wages Act upon a business president, who was also the sole shareholder. 

Under a plain reading of the act’s definition of “employer,” both McGeown and McLaren may be considered employers.  They were both “officers,” president and vice president respectively, of a “corporation,” Holiday Network.  Dumas requires this court to determine whether McGeown and McLaren “knowingly permitted” the business to violate the Payment of Wages Act.  McGeown was the owner, ran the business, directed the employees, signed the payroll checks, and continually promised various employees that he would pay them.  We find the evidence supports the trial court’s determination that McGeown did knowingly permit the business to violate the act.

However, the trial court made no findings of fact concerning McLaren’s ability or power within the business as it related to the payment of payroll.  Despite McLaren’s title as vice president, it was not in his power to pay the employees.  Instead, payment was in McGeown’s power.  McLaren could not knowingly permit the business to withhold wages, because there is no indication that he had the authority or power to grant or withhold wages.  Therefore, we find the trial court erred in holding McLaren liable under the South Carolina Payment of Wages Act.

b.  The law of the case

McGeown [2] argues a prior court order is the law of the case and holds he is not an employer of any of the plaintiffs.   We disagree.

A prior circuit court order stated it “grants partial summary judgment to the Plaintiffs and finds, as a matter of law, that they were employees of Defendant, Holiday Network Int., Inc.”  The order justifies its decision based on the fact that the employees presented, among other things, payroll check stubs to them from the business.  It is important to note that this order was issued in the shadow of denials to two sets of requests for admission from the employees asking Holiday Network to admit it employed them and that they received paychecks from it. 

The definition of “employer” under the South Carolina Payment of Wages Act clearly envisions the existence of multiple employers.  See S.C. Code Ann. 41-10-10(1); Dumas v. Infosafe Corp., 320 S.C. 188, 463 S.E.2d 641 (Ct. App. 1995) (holding both the company and its president liable under the Act).  The circuit court order does not prohibit the existence of other “employers,” but merely declares that the employees were employees of Holiday Network.  This definition neither actually nor by implication prohibits the naming of other parties as being “employers,” if such a determination is legally and factually supported.  Therefore, we find this order does not limit the application of the status as “employer” to Holiday Network exclusively.

c.  Treble damages

McGeown argues the damages should not be trebled because he did not act intentionally or in bad faith. 

Section 41-10-80(C) of the South Carolina Wage Payment Act provides in part:

In case of any failure to pay wages due to an employee as required by Section 41-10-40 or 41-10-50 the employee may recover in a civil action an amount equal to three times the full amount of the unpaid wages, plus costs and reasonable attorney’s fees as the court may allow.

S.C.Code Ann. § 41-10-80(C) (Supp. 2003).

The decision of whether to award treble damages is within the discretion of the trial court.  Rice v. Multimedia, Inc., 318 S.C. 95, 98, 456 S.E.2d 381, 383 (1995).  In holding the award of treble damages was discretionary, the court explained, “This interpretation accords with the purpose of the Wage Payment Act, to wit:  to protect employees from the unjustified and wilful retention of wages by the employer.  The imposition of treble damages in those cases where there is a bona fide dispute would be unjust and harsh.”  Id.   The court cautioned, “If there is a dispute over unpaid wages the employer acts at his peril and the court in its discretion may award treble damages when the withholding was unreasonable and there was no good faith wage dispute.”  Id.  at 99, 456 S.E.2d at 383.  In Rice, pursuant to its handbook policy, the company refused to pay the employee commissions on seven contracts following his termination.  Id.  at 97, 456 S.E.2d at 382.  The supreme court held the trial court did not abuse its discretion in refusing to award treble damages because there was no evidence the employer acted intentionally and in bad faith.  Id.  at 99-100, 456 S.E.2d at 384.

In the present case, it is undisputed that the employees are entitled to the wages they seek.  McGeown was the president and owner of Holiday Network, which suddenly closed its doors leaving its employees without their wages.  We find the trial court did not abuse its discretion in trebling the employees’ damages. 

d.  Attorney’s fees

McGeown argues the trial court awarded attorney’s fees without making the necessary findings pursuant to Baron Data Systems, Inc. v. Loter, 297 S.C. 382, 377 S.E.2d 296 (1989) [3] .  McGeown, however, failed to raise to the trial court his concern over a lack of consideration of these factors in the form of a motion to alter or amend the judgment.  We find this issue is not preserved for appellate review.  See Wilder v. Wilke, 330 S.C. 71, 76, 497 S.E.2d 731, 733 (1998) (“It is axiomatic that an issue cannot be raised for the first time on appeal, but must have been raised to and ruled upon by the trial judge to be preserved for appellate review.”); Padgett v. Mercado, 341 S.C. 229, 233, 533 S.E.2d 339, 341 (Ct. App. 2000) (stating any argument alleging an inaccuracy or inconsistency in an order must be raised by a post-trial motion). 

3.     Affidavits and absent employees

McGeown argues the master-in-equity erred by admitting affidavits and

evidence of absent employees.  We find these issues are not properly before this court.

The trial court admitted the affidavits of employees Regina Brandon and Robert Warham, who were not present at trial, in which the two employees stated the amount of wages owed them.  At trial, McGeown’s counsel objected to the admission of the affidavits arguing:  “I will have to object just because these individuals are not here and plaintiffs as a general rule can’t present their case by way of their own affidavit.”  On appeal, however, McGeown argues the affidavits were inadmissible because they were hearsay.  A party may not argue one ground for objection at trial and a different ground on appeal.  Murray v. Bank of America, 354 S.C. 337, 347, 580 S.E.2d 194, 199 (Ct. App. 2003).  Accordingly, this argument is not preserved.

McGeown also argues the trial court erred in awarding judgments in favor of a number of employees who did not appear to testify at trial.  Although the trial court ruled that these employees could present evidence at a subsequent hearing, no such hearing ever occurred.  McGeown failed to raise to the trial court his objection to the judgments in favor of these employees either during the trial or in a post-trial motion.  Thus, this argument is not preserved.  See Wilder Corp. v. Wilke, 330 S.C. 71, 76, 497 S.E.2d 731, 733 (1998)(“It is axiomatic that an issue cannot be raised for the first time on appeal, but must have been raised to and ruled upon by the trial judge to be preserved for appellate review.”); Pelican Bldg. Ctrs. v. Dutton, 311 S.C. 56, 60, 427 S.E.2d 673, 675 (1993) (stating that although the appellant learned for the first time upon receiving the order on a post-trial motion that the respondent would be granted certain additional relief, the appellant must move under Rule 59(e), SCRCP, to alter or amend the judgment to preserve the issue).


For the reasons stated above, the trial court’s judgment in favor of the employees on their cause of action for promissory estoppel is reversed as to both McGeown and McLaren.  The court’s imposition of individual liability under the South Carolina Payment of Wages Act is reversed as to McLaren and affirmed as to McGeown. 



[1] We decide this case without oral argument pursuant to Rule 215, SCACR.

[2]   As we found above McLaren is not liable under the South Carolina Payment of Wages Act, we address the remaining issues as they pertain to McGeown alone.

[3] These factors are:  (1) the nature, extent and difficulty of the legal services rendered; (2) the time and labor necessarily devoted to the case; (3) the professional standing of counsel; (4) the contingency of compensation; (5) the fee customarily charged in the locality for similar legal services; and (6) the beneficial results obtained.  Baron, 297 S.C. at 384-85, 377 S.E.2d at 297.