Ancich v. Mobil Oil Corp.

Decision Date14 July 1981
Docket NumberNo. 3-1279A333,3-1279A333
Citation422 N.E.2d 1320
PartiesJoseph F. ANCICH, Arnold T. Bewley, Pete N. Billen, Mike Blaskovich, Mike Cebra, Ray Ferrini, Robert Heli, Keith Keilman, A. W. Keune, Eugene Kish, Norman Kostoff, Joseph Kula, Ted Kunka, Bob Lamski, Joe Lescak, Tony J. Lopiccilo, Ray Macek, Anthony Matuga, C. A. Monestere, Michael J. O'Brien, John Patterson, Norbert Rosinski, Richard Ruthkowski, Donald E. Smith, Robert G. Smith, S. P. Susko, Sr., Eugene Toth, George Fischer, Tony Sladish, Appellants (Plaintiffs Below), v. MOBIL OIL CORPORATION, Appellee (Defendant Below).
CourtIndiana Appellate Court

Lowell E. Enslen, Gary K. Matthews, McHie Enslen & Myers, Hammond, for appellants.

Joseph E. Costanza, Lester Murphy, Jr., Murphy McAtee Murphy & Costanza, East Chicago, Robert C. Fox, AMF O'Hare, Ill., for appellee.

YOUNG, Presiding Judge.

Plaintiffs-appellants (Mobil employees) appeal the grant of summary judgment in favor of defendant-appellee Mobil Oil Corporation on plaintiffs' complaint for damages which alleged that certain benefits provided by a "Termination Allowance Plan" (TAP) of Mobil Oil Corporation were wrongfully withheld from plaintiffs. Both parties moved for summary judgment; summary judgment was granted for defendant and plaintiffs now argue that genuine issues of material fact exist which preclude summary judgment.

Central to this case is construction of the Termination Allowance Plan (TAP). The construction of a written contract is generally a question of law for the trial court, summary judgment being particularly appropriate since there are no issues of fact. However, if reasonable men would find the contract susceptible of more than one construction, ambiguity exists making summary judgment inappropriate, it being the responsibility of the trier of fact to ascertain the extrinsic facts necessary to interpret the contract. Kleen Leen, Inc. v. Mylcraine, (1977) Ind.App., 369 N.E.2d 638. If, on the other hand, the ambiguity arises, not because of extrinsic facts, but by reason of the language used, construction of the ambiguous contract is a question of law for the trial court. Indiana Broadcasting Corp. v. Star Stations, (1979) Ind.App., 388 N.E.2d 568, 572. Thus, whenever summary judgment is granted based upon the construction of a contract, the trial court has either determined as a matter of law that the contract is not ambiguous or uncertain, Kleen Leen, Inc., supra, 369 N.E.2d at 641, or that the contract ambiguity, if it exists, can be resolved without the aid of factual determinations. Indiana Broadcasting Corp., supra, 388 N.E.2d at 572.

The plaintiffs argue that the contract is ambiguous, its proper interpretation being a question of fact to be determined only after hearing evidence whether the TAP plan was interpreted and applied by Mobil Corporation in the past, whether the plan was explained to Mobil employees and whether they relied on any particular interpretation of the plan. The plaintiffs, however, have failed to demonstrate, through affidavit or other supporting documents, that a genuine triable issue existed. Whether the TAP was interpreted in the past, whether it was explained to the Mobil employees and whether they relied upon such explanation were facts never placed in issue before the trial court.

In its answer to the plaintiffs' complaint, the defendant admitted the existence of the TAP and the plaintiffs' entitlement to benefits thereunder. The only issue which remained was a question of law the interpretation of the TAP. The defendant supported its motion for summary judgment with an affidavit explaining how the disputed benefits were computed and a memorandum of law in which it argued the contract when read as a whole was unambiguous. It thereby sustained its burden of showing that the TAP was not ambiguous and that the computation of benefits was correct. The plaintiffs failed to respond to the summary judgment motion of defendants relying instead on their pleadings. Of course, the failure of the plaintiffs to respond did not automatically entitle the defendant to a summary judgment. Smith v. P. & B. Corp., (1979) Ind.App., 386 N.E.2d 1232, 1234. Nonetheless, they ran the risk of suffering an adverse ruling by their failure to defend affirmatively against the defendant's motion. Bassett v. Glock, (1977) Ind.App., 368 N.E.2d 18, 23.

While the burden was upon defendant Mobil Oil Corp. to establish that no material facts were in genuine issue, all doubts and fair inferences being resolved in favor of the plaintiffs, Bassett, supra, 368 N.E.2d at 23, once the defendant, by the materials filed, established the lack of a genuine issue of material fact, it was incumbent upon the plaintiffs, in compliance with Ind.Rules of Procedure, Trial Rule 56(E), to show the existence of a genuine issue for trial. This the plaintiffs failed to do. Even accepting the plaintiffs' argument that prior interpretations of the plan, reliance, etc. were material facts bearing upon proper constructing of an ambiguous plan, the plaintiffs presented no evidence for which the trial court could have reasonably inferred that these facts were in genuine issue. 1 That there might have been prior interpretations of the plan or reliance by the Mobil employees on an interpretation of the plan is mere speculation and conjecture. The trial court was faced with a situation in which no genuine issues of material fact had been shown to exist. Consequently, the plaintiffs are now barred from challenging the judgment on the ground there is a genuine issue of material fact. We therefore turn to the next dimension of review, whether the trial court properly construed the TAP.

The dispute between the plaintiffs and the defendant concerns the construction of Article IV, Section 2, Subsection (a) of the TAP. That clause provides that:

"The following deductions shall be made from each payment of termination allowance otherwise provided in Section 1(a) of this Article IV:

(a) The amount of total maximum benefit which an unemployed person, considered as a single person without dependents, is eligible to receive pursuant to any applicable employer-corporation or government plan or program which grants benefits for unemployment, and

(b) The amount of any benefit or payment of the kind generally known as workmen's compensation which the employee is eligible to receive for an accident or injury sustained in the course of employment by an employer-corporation when termination of employment was under such circumstances that employee or any dependent or beneficiary is eligible to receive such benefit or payment." (Emphasis added).

Applying subsection (a), the defendant deducted $1,560.00 from the allowance paid to each terminated worker. That sum was computed by determining the maximum amount an unemployed person considered as a single person without dependents is eligible to receive under Indiana unemployment compensation law. The defendant argued and the trial court found that subsection (a) authorizes a uniform deduction from each payment of termination allowance without regard to the individual employee's eligibility for or entitlement to state unemployment compensation. The trial court made these findings:

1. The Court finds that there remains no genuine issue as to any material fact.

2. Article IV, Section 2, Subsection B (sic) of the Termination Allowance Plan is a formula to be used with regard to each terminated employee and bears no relationship to such employee's actual rights under any employment benefit arrangement. Rather it is merely an actuarial method of providing a reduction leading to net termination benefits.

3. That the defendant has properly interpreted the Plan as it affects the plaintiffs in this cause.

4. Whether or not the plaintiffs or any of them were entitled or eligible to receive unemployment benefits in each particular case is not relevant to the case at bar.

5. That the defendant is entitled to judgment as a matter of law and therefore its Motion For Summary Judgment should be sustained.

The plaintiffs argue the trial court erroneously construed subsection (a). They argue subsection (a) authorizes a reduction in the termination allowance the terminated employee would otherwise receive under the plan only if the employee is actually receiving unemployment compensation or is in fact eligible to receive such compensation. To resolve this issue of contract meaning, we examine the contract as a whole. Fort Wayne Bank Building, Inc. v. Bank Building & Equipment Corp., (1974) 160 Ind.App. 26, ...

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