Hopkins v. Garner & Glover Co.

• Decision Date: 02 July 1998
• Docket Number: No. A98A1597.,A98A1597.
• Citation: 504 S.E.2d 78,233 Ga. App. 264
• Court: Georgia Court of Appeals
• Parties: HOPKINS v. GARNER & GLOVER COMPANY.

504 S.E.2d 78

233 Ga. App. 264

HOPKINS v. GARNER & GLOVER COMPANY.

No. A98A1597.

Court of Appeals of Georgia.

July 2, 1998.

Certiorari Denied November 5, 1998.

Brinson, Askew, Berry, Seigler, Richardson & Davis, Robert L. Berry, Jr., Mark M.J. Webb, Rome, for appellant.

Hine & Niedrach, John E. Niedrach, Rome, for appellee.

ELDRIDGE, Judge.

James Hopkins, defendant-appellant, was employed as an insurance agent by Garner & Glover Company, plaintiff-appellee, from September 1, 1982, until January 1995. The employment agreement provided that it was for an initial four years; however, the attached compensation schedule expressly stated that it would govern the initial four years and any further period of employment unless modified in writing by the parties.

From sometime after March 1992, the defendant was unable to produce sufficient commissions, and plaintiff provided a regular draw, which was paid whether or not there were earned commissions. Plaintiff paid the defendant $500 a month in addition to the commission draw.

In March 1992, defendant executed a promissory note to the plaintiff in the amount of $34,603.62, which was due December 31, 1992. At a later date, the defendant and the plaintiff's president executed a document denominated "memorandum of agreement" that stated in part "[n]o payment will be required on the current note until 1-1-93 although interest will continue to accrue. As of 1-1-93, the current note will be exchanged for a note of no more than five (5) years with an interest rate of no less than the current accrued deficit." No new note was ever exchanged for the original note.

In January 1995, defendant left the plaintiff's employment and went to work for a rival insurance agency. The defendant discussed with the prospective employer which accounts of the plaintiff's the defendant could bring with him, and upon moving, defendant did bring a number of accounts. Plaintiff sued on the note. The defendant answered, denying liability on the note, and asserted a counterclaim based upon a set-off from commissions on renewal premiums allegedly due to him from the plaintiff.

The parties entered into an employment agreement during the defendant's employment for a period of four years that began on September 1, 1982. Compensation was provided that the defendant receive 50 percent of all new contracts written by the defendant; that defendant receive 25 percent of all renewals of insurance written by the defendant; and that "when [defendant] validates" he "will own fifty percent (50%) of the renewals retroactive to the date of employment." After the initial four years of employment under the compensation schedule, the compensation schedule stated that defendant's compensation was to be based upon commissions earned under the schedule unless replaced by a new schedule mutually agreed upon by the parties. Defendant worked exclusively for the plaintiff until January 9, 1995.

Defendant testified that he validated on January 1, 1991, "meaning whatever his commission split happened to be is what constituted his compensation." Validation occurs when commissions exceed any guarantee of what an agent is paid or when the agent's commission split with plaintiff constitutes his compensation. Defendant also testified that, at all times during his employment, he engaged in the insurance business exclusively and solely as an agent for the plaintiff and that at no time did he engage in any other business or professional activity. Plaintiff's principal, William A. Dupree, denied that the defendant ever validated, because after the March 1992 memorandum agreement, the defendant received $500 a month in addition to his draw. Each month the defendant received a set amount of compensation from the plaintiff.

The parties filed cross-motions for summary judgment both on the note and on the counterclaim. On January 24, 1997, the trial court granted plaintiff's motion for summary judgment on the note and denied defendant's motion on such issue. However, on the counterclaim, the trial court denied both parties' motions. In such order, the trial court stated that "the court can best determine that validation never took place in the case at hand. By defendant's admission, he received a set amount each month as compensation. It would appear that validation never occurred during the time that Defendant was employed by Plaintiff.... While the evidence shows validation was not obtained, the opportunity for repayment still exists to make the employer whole again.... Summary Judgment GRANTED to Plaintiff on the Promissory Note in the amount of $42,351 as of March 20, 1996, plus daily interest of $11.38 from March 20, 1996 through the date of judgment, plus 10% of all principal and accrued interest as attorney's fees. Summary judgment on the Defendant's counterclaim DENIED."

In an earlier appeal, this Court, on November 20, 1997, affirmed the trial court in Case No. A97A1391, an unpublished opinion. This Court stated that the trial court "found that `validation never took place'"; since the defendant did not raise this "finding" as error, it could not address such issue.

After the remittitur, plaintiff filed a renewed motion for summary judgment. The trial court entered its order on February 23, 1998, which sought to clarify the order of January 24, 1997, and granted the second summary judgment motion.

The defendant's enumeration is that the trial court erred in granting summary judgment on February 23, 1998, as to the counterclaim. We agree.

1. The record shows that there is a material issue of fact as to the validation; the defendant testified positively that he had validated on January 1, 1991, and Mr. Dupree denied that the defendant had done so. In the January 24, 1997 order, in explaining why the trial court denied the defendant's summary judgment motion as to the counterclaim, the trial court stated "the Court can best determine that validation never took place in the case at hand. By defendant's own admission, he received a set amount each month as compensation. It would appear that validation never occurred during the time that Defendant was employed by Plaintiff.... While the evidence shows validation was not obtained ... [, the plaintiff was entitled to judgment]."

Nowhere in the order of January 24, 1997, did the trial court state that it granted the plaintiff's motion for summary judgment as to the defendant's counterclaim or granted plaintiff's motion as to all issues, although the order stated that the motion was granted as to the note. In fact, the alleged admission by the defendant that "he received a set amount each month as compensation" is subject on motion for summary judgment to the favorable inference that the plaintiff spread defendant's earned commissions evenly throughout the year as a draw against prior earnings, instead of a salary, which would support, and not negate, "validation" on January 1, 1992, and the $500 per month did not commence until some time after March 1992, three months after the alleged validation. There is no evidence that it was the intent of the parties that the defendant could fall out of validation since achieved or that he had to continuously maintain such status for any period of time to validate. The trial court could not, under OCGA § 9-11-56, make findings as to such disputed facts.

In its opinion, this Court stated that "the trial court did not expressly rule on the enforceability of the [employment] contract but concluded that Hopkins never validated" and that this Court could not address an issue not raised that the trial court "found that `validation never took place.'" Since such "finding" by the trial court went expressly to the denial of the defendant's motion for summary judgment as to the counterclaim, and not to the grant of summary judgment for the plaintiff on such issue, then defendant was not bound by such "finding" as the law of the case. Obviously, the plaintiff realized this, because plaintiff filed a renewed motion for summary judgment that stated: "[t]he Plaintiff believes that this Court's January 24, 1997 Order adjudicated the Defendant's Counterclaim in the Plaintiff's favor." Plaintiff sought to have the trial court retroactively grant its motion for summary judgment over a year later as to the counterclaim. The trial court saw plaintiff's motion as seeking "clarification of January 24, 1997 Order of This Court in Parties' Cross Motions for Summary Judgment, specifically pertaining to the Denial of Defendant's Motion for Partial Summary Judgment." (Emphasis supplied.) This plainly states that the trial court knew that it had denied such motion. However, in the order of February 23, 1998, the trial court further stated: "This Court found that Mr. Hopkins NEVER VALIDATED and in clarification of Our Original Order, because Mr. Hopkins NEVER VALIDATED, his rights to enforce any existing Employment Contract with Garner and Glover ended the day he went to his new employer." The trial court had second thoughts as to its order entered a year earlier and sought to change it retroactively instead of ruling currently on the validation issue on the renewed motion for summary judgment.

The trial court has the inherent power to modify or amend its final orders or judgment until the end of the term within which it was entered. Cooley v. All the World, 247 Ga. 459, 460(1), 276 S.E.2d 615 (1981); Bank of Cumming v. Moseley, 243 Ga. 858, 257 S.E.2d 278 (1979); Pekor v. Clark, 236 Ga. 457, 458(1), 224 S.E.2d 30 (1976); Bd. of Ed. of Hall County v. Shirley, 227 Ga. 565, 566, 181 S.E.2d 826 (1971); Hinson v. Hinson, 218 Ga. 447, 128 S.E.2d 487 (1962). When the term expired without a petition to amend being filed by either party, the trial court lost its inherent power to amend as to any matter of substance except as provided by statute. See Cobb County v. Buchanan, 261 Ga. 857, 858, 413 S.E.2d 198 (1992); City of Cornelia v....