Baum v. Helget Gas Products, Inc.

• Decision Date: 16 March 2006
• Docket Number: No. 05-2142.,05-2142.
• Citation: 440 F.3d 1019
• Parties: Robert BAUM, Appellant, v. HELGET GAS PRODUCTS, INC., Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1019

440 F.3d 1019

Robert BAUM, Appellant, v. HELGET GAS PRODUCTS, INC., Appellee.

No. 05-2142.

United States Court of Appeals, Eighth Circuit.

Submitted: December 15, 2005.

Filed: March 16, 2006.

Counsel who presented argument on behalf of the appellant was David N. Damick of St. Louis, MO.

Counsel who presented argument on behalf of the appellee was Daniel K. O'Toole of St. Louis, MO. Cynthia A. Petracek of St. Louis appeared on the brief.

Before MELLOY, COLLOTON, and BENTON, Circuit Judges.

BENTON, Circuit Judge.

Robert L. Baum sued his former employer, Helget Gas Products, Inc. ("HGP"), claiming breach of a three-year employment contract, or negligent and fraudulent misrepresentation of employment for three years. The district court granted HGP summary judgment, holding that Baum did not have a contract for a term of years, and alternatively, that HGP did not misrepresent the existence of a contractual guarantee. Baum appeals. Having jurisdiction under 28 U.S.C. § 1291, this court affirms in part, reverses in part, and remands.

I.

In January 2002, Baum met HGP's President, James F. Helget, and the St. Louis branch manager, Kenneth Bromeier, to discuss a sales position. Baum was then employed by a competitor, but worried it might soon stop operations. At the meeting, Baum informed Helget and Bromeier that he needed an employment contract before leaving his current position. He told Helget and Bromeier that he wanted a contract for at least three years as job security before changing employers at age 59. Throughout the meeting, Baum took detailed notes, itemizing the proposed salary, benefits, and job duties in years 2002, 2003, and 2004. He gave this handwritten paper to Helget at the end of the meeting.

After further negotiations and an employment test, HGP hired Baum as a salesman on February 25, 2002. Baum immediately reminded Helget that he needed a written employment agreement as soon as possible. Helget said he would have Baum's meeting notes typed up and signed. After a week's delay, Baum asked Bromeier to sign the original meeting notes. Bromeier agreed. He and Baum signed the paper on March 1, 2002, adding the words "contract with Helget Gas Products St. Louis Mo. Market" at the top of the handwritten page. As St. Louis branch manager, Bromeier had authority to sign for HGP. Although Baum and Bromeier drew a line for Helget's signature, he never signed the paper.

The final paper has three columns labeled 2002, 2003, and 2004. It says that, in 2002, Baum's salary is $39,150 with an additional bonus of $2,000; in 2003, he would receive a $43,150 salary and a $4,000 bonus; and in 2004, a $45,150 salary and a $6,000 bonus. It also provides that Baum is due a $2,000 increase in bonus each year after 2004, and that HGP would provide $9,600 each year to lease a vehicle and cell phone. As to the vehicle, HGP is to pay for or buy-out the lease if Baum is discharged "before contract expires." Finally, the paper provides for health insurance, vacation and sick leave, paid holidays, funeral leave, and an expense account.

Baum was the only salaried salesman at HGP in St. Louis. Baum testified he never received any performance expectations or goals to justify his salary, but was expected to service HGP's largest account (Anheuser Busch) and to bring in as many new customers as possible. He also stated that his supervisor told him that he was meeting HGP's expectations during his employment, as he was "doing everything he was asked."

Helget disagreed, pointing to another pre-employment document, a "letter of agreement" where Helget specified that he expected Baum to produce at least $1,000 in new business each month in order to justify his compensation. Baum did not sign the letter, and claimed never to have seen it. Helget testified he spoke with Baum several times about his failing sales performance, which was consistently below his monthly salary — far less than $1,000 new business each month. When Baum's sales performance did not improve (according to Helget), HGP terminated him on November 13, 2002.

Baum sued HGP for breach of contract, negligent misrepresentation, and fraudulent misrepresentation. HGP moved for summary judgment, asserting that the handwritten paper was not an employment contract for three years, and that HGP never represented it was. HGP thus concluded that Baum was an at-will employee subject to termination at any time. HGP also argued that no one told Baum he had a guaranteed employment term, and that Baum understood he had to perform to HGP's expectations in order to keep his job.

The district court granted HGP's motion, first holding that, while the handwritten paper could be construed as a contract, it was not an employment contract for a definite term of at least three years. Rather, the district court found that the paper merely specified Baum's salary if employed through 2004. Because the district court found the handwritten paper unambiguous, it refused parol evidence indicating Baum's requirement and understanding of employment for at least three years. Additionally, the district court concluded that no one at HGP promised Baum employment for any period of time, defeating his negligent and fraudulent misrepresentation claims. Baum appeals.

II.

Baum first argues that the district court erred in granting summary judgment on the breach-of-contract claim. This court reviews the grant of summary judgment de novo, applying the same legal standards employed by the district court, and considering whether the district court correctly followed the applicable substantive law. See Midwest Oilseeds, Inc. v. Limagrain Genetics Corp., 387 F.3d 705, 710-11 (8th Cir.2004). The district court is affirmed if, viewing the evidence favorably to the non-moving party, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Davis v. Hall, 375 F.3d 703, 711 (8th Cir.2004). Summary judgment is not appropriate if the non-moving party can set forth specific facts, by affidavit, deposition, or other evidence, showing a genuine issue for trial. Grey v. City of Oak Grove, 396 F.3d 1031, 1034 (8th Cir.2004). This court reviews the district court's interpretation of Missouri law de novo. See Erie R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938); Riordan v. Corp. of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints, 416 F.3d 825, 829 (8th Cir.2005).

Under Missouri law, "in the absence of a contract for employment for a definite term or a contrary statutory provision, an employer may discharge an employee at any time, without cause or reason, or for any reason." Main v. Skaggs Cmty. Hosp., 812 S.W.2d 185, 187-88 (Mo. App.1991), quoting Christy v. Petrus, 365 Mo. 1187, 295 S.W.2d 122, 124 (1956). Unless the contract specifies the duration of employment or limits the reasons for discharge, either party may terminate the employment relationship at any time, with no liability for breach of contract. See Luethans v. Wash. Univ., 894 S.W.2d 169, 172 (Mo. banc 1995); McCoy v. Spelman Mem. Hosp., 845 S.W.2d 727, 730 (Mo.App. 1993); Panther v. Mr. Good-Rents, Inc., 817 S.W.2d 1, 3 (Mo.App.1991).

Baum asserts that the signed, handwritten paper constitutes a valid three-year employment contract. While conceding it does not limit the reasons for discharge, he argues that it sets forth a duration of employment from February 2002 to December 2004.

HGP responds, and the district court agreed, that the paper only establishes Baum's projected salary and benefits over a three-year period, which is not a "contractual undertaking" to employ Baum for three years. See Anselmo v. Mfrs. Life Ins. Co. 595 F.Supp. 541, 547 (W.D.Mo. 1984), aff'd, 771 F.2d 417 (8th Cir.1985). HGP invokes the Missouri cases holding that, if an employment document does not specify a duration, the relationship is at-will. See Sturgis Equip. Co. v. Falcon Indus. Sales Co., 930 S.W.2d 14, 18 (Mo. App.1996); Kaskowitz v. Commerce Magazine, Inc., 793 S.W.2d 628, 631 (Mo.App. 1990) ("an indefinite hiring at so much per day, or per month, or per year, is a hiring at will, and may be terminated by either party at any time"), quoting Campbell v. Sheraton Corp., 363 Mo. 688, 253 S.W.2d 106, 110 (1952).

Whether the district court erred depends on whether the handwritten paper is ambiguous. Under Missouri law, summary judgment in a contract case is appropriate only where the contract language is so clear and unambiguous that the contract's meaning is readily apparent from the face of the document itself. See Family Snacks of N.C., Inc. v. Prepared Prods. Co., 295 F.3d 864, 867 (8th Cir.2002), quoting Mo. Consol. Health Care Plan v. BlueCross BlueShield of Mo., 985 S.W.2d 903, 908 (Mo.App. 1999); E.O. Dorsch Elec. Co. v. Plaza Constr. Co., 413 S.W.2d 167, 172-73 (Mo.1967); MECO Sys., Inc. v. Dancing Bear Entm't, Inc., 948 S.W.2d 185, 190-91 (Mo.App.1997). Where the contract is textually ambiguous, a question of material fact exists as to the parties' intent, which is for a jury to resolve at trial. Graham v. Goodman, 850 S.W.2d 351, 354-56 (Mo. banc 1993); Tuttle v. Muenks, 21 S.W.3d 6, 9 (Mo.App.2000); Busch & Latta Painting Corp. v. State Highway Comm'n, 597 S.W.2d 189, 198 (Mo.App.1980). See Anderson, 477 U.S. at 247-48, 106 S.Ct. 2505 (state substantive law identifies which facts are material for a motion for summary judgment).

The cardinal rule in contract interpretation is to ascertain and give effect to the true intent of the parties. See Lyster v. Ryan's Family Steak Houses, Inc., 239 F.3d 943, 946 (8th Cir.2001), quoting Speedie Food Mart, Inc. v. Taylor, 809 S.W.2d 126, 129 (Mo.App.1991); J.E. Hathman, Inc. v. Sigma Alpha Epsilon Club, 491 S.W.2d 261, 264 (Mo. banc 1973). Unless the contract is ambiguous, the parties' intent is determined by the...