AND WISE INDUSTRIES, INC. and DJSJ, INC. v. GRW KENTUCKY INC. and GRANT WILSON
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RENDERED:
October 5, 2001; 2:00 p.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
2000-CA-001080-MR (DIRECT APPEAL)
AND
NO. 2000-CA-001177-MR (CROSS-APPEAL)
WISE INDUSTRIES, INC. and
DJSJ, INC.
v.
APPELLANTS/CROSS-APPELLEES
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE ROGER CRITTENDEN, JUDGE
ACTION NO. 97-CI-01830
GRW KENTUCKY INC. and
GRANT WILSON
APPELLEES/CROSS-APPELLANTS
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
DYCHE, EMBERTON AND HUDDLESTON, JUDGES.
EMBERTON, JUDGE: This is a contract dispute between Grant Wilson
and GRW Kentucky, Inc., and Wise Industries, Inc., n/k/a/ DJSJ,
Inc., a tool and die company which manufactures parts for the
automotive industry.
In 1985, Grant Wilson, through his company GRW
Kentucky, Inc., worked in the automotive industry as a
manufacturer’s representative.
He became aware that Wise
Industries was for sale and on behalf of NARMCO, a Canadian
company interested in acquiring Wise, contacted Wise.
Eventually, Douglas Wise, president of Wise Industries, became
interested in hiring Wilson to solicit business for Wise, and on
January 3, 1996, the parties entered into a written contract
providing that Wilson would act as Wise Industries’
representative and would be paid a $5,000 monthly retainer.
At
the time of Wilson’s employment, Wise had existing contacts with
The Budd Company, Dana Corporation, and Johnson Controls.
Shortly after being employed by Wise, Wilson learned
that Dana Corporation in Elizabethtown planned to out-source some
of its parts.
Wilson ultimately negotiated a sales contract with
Dana on behalf of Wise.
When estimating the sales price, Wilson
included a commission into the price with the expectation that
Wise would be sold to NARMCO and he would be paid his commission.
During the fall of 1996, the sale of Wise to NARMCO
having fallen through, Wilson requested a raise from Wise.
Wise
admits that he agreed to pay Wilson $8,000 per month, but denies
that this was ever reduced to writing.
Wilson, however,
maintains that an amendment to the January 3, 1996, contract is
contained in a second letter agreement dated October 1, 1996, and
provides for a 3% commission on any new or added customer for
the life of the contract in addition to his monthly salary.
Wise
maintains that the signature on the October document is a
forgery.
In the spring of 1997, Wilson proposed to Wise that
they form a partnership to be called Versatile Manufacturing for
the production of automotive crash bars; the venture, however,
never came into existence.
Wilson continued to work for Wise and
in June 1997, when it was anticipated that Wise would be sold to
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a company called Leggett & Platt, Wilson was paid a finders fee.
Wilson continued to work for Wise and negotiated new contracts
with Dana Corporation and The Budd Company.
In September 1997, Wilson proposed a draft of a
contract including a provision that he would receive "four
percent commission on all sales made to the represented
companies, including Dana Corporation and The Budd Company."
Wise made several handwritten changes to the proposed agreement;
the commission provision, however, was left unchanged and the
agreement was signed on September 16, 1997.
In November 1997, Wilson presented to Wise an invoice
for payment.
Wise maintains that invoice was for $5,000, which
he approved with his initials.
Wise further contends that Wilson
subsequently forged Wise’s initials to an invoice for $52,997.
Wilson claims that the invoice initialed by Wise for $52,997
reflected 4% of the gross sales from Dana Corporation and The
Budd Company from which he subtracted the advance he received in
the summer of 1997 on the proposed sale to Leggett & Platt.
He
submitted the invoice for payment to Charlie Barber, Wise’s
comptroller, who issued a check in the amount of $52,997, which
Wilson deposited in his account.
Wise stopped payment on the
check and the following day fired Wilson for forging his initials
and attempting to misappropriate $48,000.
Wilson filed suit on December 17, 1997, alleging breach
of contract seeking damages in the amount of $1,952,774.10, which
represented a 4% sales commission allegedly earned between
October 1997, through December 31, 1999.
Wise counter-claimed
for advances made to Wilson in the amount of $52,000.
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The case
was submitted to a jury which was unable to reach a verdict.
A
second trial was held and the jury found that the parties had
agreed Wilson would serve as sales representative and Wise would
pay a 4% commission on all sales contracts with Dana Corporation
and The Budd Company.
Wilson was awarded $950,000, and Wise
$52,000.
Wise contends that the term “all” refers only to the
sales contracts made after the signing of the employment
contract.
Prior to trial, Wilson moved for partial summary
judgment contending that the agreement is clear and unequivocal
and that the parole evidence rule precludes evidence which would
vary the terms of the written agreement.
Wilson then moved for
the court to construe the contract to entitle him to a 4%
commission on all sales made to the companies listed in the
agreement, including those made prior to its effective date, and
requested that summary judgment be entered in its favor.
did not move for summary judgment.
Wise
To the contrary, in its
response to Wilson’s motion, Wise vehemently argued that the
contract was ambiguous and extrinsic evidence was admissible to
determine the parties’ intent.
The construction of the contract,
Wise persuaded the court, was one of fact, not of law.
“It is an elementary rule that trial courts should be
given the opportunity to rule on questions before those issues
are subject to appellate review.”1
Although this case was
submitted to the jury on two occasions, Wise never contended that
the case should be decided as a matter of law.
1
Wise is precluded
Swatzell v. Commonwealth, Ky., 962 S.W.2d 866, 868 (1998).
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from arguing a completely contrary position after the jury
reached a verdict unsatisfactory to him.
In BTC Leasing, Inc. v.
Martin,2 the court held that a party who took the stance that
summary judgment was appropriate because there was no genuine
issue of material fact was precluded on appeal from contending
that a material issue of fact existed.
Similarly, in this case,
Wise cannot now maintain that the contract was not ambiguous and
the trial court erred in submitting the case to the jury.
Wise
invited the error, if any, and cannot now complain that the trial
court accepted his argument.3
Declining to review the issue of
whether the contract is ambiguous, we accept the trial court’s
conclusion that it was a submissible jury issue and extrinsic
evidence was admissible.4
At trial Wilson presented the testimony of two
manufacturer’s representatives, Robert Chandler, a salesman in
the automotive business since 1963, and since 1974 an independent
contractor acting as a manufacturer’s representative, and Ken
Seroka, an independent manufacturer’s representative for nine
years.
Both testified as to the meaning of the phrase “shall be
paid commission of four percent (4%) on all sales contracts
represented” and “for the life of the product,” or “for the life
of the contracted part” in the automotive industry.
They were
specifically prohibited from addressing the intent of the parties
2
Ky. App., 685 S.W.2d 191 (1984).
3
Hovermale v. Central Kentucky Natural Gas Co., Ky., 282
S.W.2d 136 (1955).
4
White Log Jellico Coal Co., Inc. v. Zipp, Ky. App., 32
S.W.3d 92 (2000).
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to the Wilson/Wise contract.
Wise contends that neither Chandler
nor Seroka were properly qualified as experts.
Whether a witness is properly qualified as an expert is
left to the sound discretion of the trial court.5
Both Chandler
and Seroka were experienced in the automotive industry and aware
of the customary method of payment to sales representatives.
Neither witness expressed an opinion on the meaning of the
particular contract at issue and both were merely stating the use
of certain terms in the industry based on what they had observed
through years of working in the industry.6
We find no abuse of
discretion in admitting the testimony.
Wilson cross-appeals contending that the issue of
damages should not have been submitted to the jury.
At the close
of proof Wilson argued to the trial court that the 4% sales
commission was a readily ascertainable amount to be determined by
the court.
Liquidated damages are defined as:
Ascertained; determined; fixed; settled; made
clear or manifest; cleared away; paid;
discharged . . . declared by the parties as
to amount . . . made certain as to what and
how much is due . . . made certain or fixed
by agreement of the parties or by operation
of law.7
(Citations omitted).
Although the jury found that Wilson was entitled to a
4% sales commission on all sales to Dana Corporation and The Budd
Company for as long as the contracted parts are sold to those
5
Gentry v. General Motors Corp., Ky. App., 839 S.W.2d 576,
578 (1992).
6
See Louisville & Jefferson County Board of Health v.
Mulkins, Ky., 445 S.W.2d 849 (1969).
7
Miller v. Stumbo, Ky. App., 661 S.W.2d 1, 2 (1983).
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companies, there was conflicting evidence as to what parts were
sold during the disputed period and who was responsible for
acquiring the contract.
We find no error.
Wilson’s contention that the trial court erred in
denying his motion to preclude testimony concerning his alleged
forgery of Wise’s initials on the 1997 invoice is without merit.
The issue of forgery was not merely collateral to the issue of
commissions owed.
In addition to maintaining he was entitled to
commissions under the contract, Wilson also maintained that he
was entitled to damages for breach of the consulting portion of
the same contract because he was not terminated for just cause.
Clearly, Wilson’s alleged forgery of Wise’s initials was
relevant.
The trial court held that a purchase asset agreement
entered into in June 1998, pursuant to which Wise Industries sold
its assets to Wise Manufacturing for approximately twenty-seven
million dollars was irrelevant.
Relevancy determinations rest in
the sound discretion of the trial court.8
We agree with the
trial court that the sale of Wise Industries does not tend to
establish the meaning of the contract at issue in this case.
Informing the jury of the multi-million sale could serve no
purpose other than to demonstrate the depth of Wise’s pockets.
Finally, we find no merit to Wilson’s contention that
Wise Manufacturing, not Wise Industries, is the real party in
interest and that Wise’s counterclaim for $52,000 against Wilson
should have been dismissed.
8
The sale occurred after the instant
Glens Falls Ins. Co. v. Ogden, Ky., 310 S.W.2d 547 (1958).
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litigation was filed and there was evidence that Wise
Manufacturing was aware of the litigation when negotiating the
purchase price.
The judgment of the Franklin Circuit Court is affirmed.
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ALL CONCUR.
BRIEF FOR APPELLANTS/CROSSAPPELLEES:
BRIEF AND ORAL ARGUMENT FOR
APPELLEES/CROSS-APPELLANTS:
Bruce F. Clark
M. Jane Brannon
Lexington, Kentucky
Stephen M. O’Brien, III
Lexington, Kentucky
ORAL ARGUMENT FOR
APPELLANTS/CROSS-APPELLEES:
Bruce F. Clark
Lexington, Kentucky
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