Comp & Soft, Inc. v. At & T Corp.

• Decision Date: 25 March 2008
• Docket Number: No. ED 89266.,ED 89266.
• Citation: 252 S.W.3d 189
• Parties: COMP & SOFT, INC., Plaintiff/Appellant, v. AT & T CORPORATION, Defendant/Respondent.
• Court: Missouri Court of Appeals

252 S.W.3d 189

COMP & SOFT, INC., Plaintiff/Appellant, v. AT & T CORPORATION, Defendant/Respondent.

No. ED 89266.

Missouri Court of Appeals, Eastern District, Division Two.

March 25, 2008.

Motion for Rehearing and/or Transfer to Supreme Court Denied May 7, 2008.

Gregory G. Fenlon, Clayton, MO, for Appellant.

James W. Erwin, John Joseph Gazzoli, Jr., co-counsel, St. Louis, MO, for Respondent.

BOOKER T. SHAW, Judge.

Appellant Comp & Soft, Inc. (CSI) appeals the trial court's summary judgment in favor of Respondent AT & T Corporation (AT & T) on CSI's petition alleging breach of contract and related claims arising from an arrangement for the provision of information technology consultants. CSI asserts that the trial court erred in granting summary judgment because there were genuine issues of material facts in dispute. The trial court's judgment is affirmed.

Facts and Procedural History

In 1999, AT & T was working on two projects requiring additional technical personnel for an uncertain duration. CSI was in the business of providing IT consultants for such projects. AT & T's business manager, Gina Vogler, and CSI's sales recruiter, Jeannette Massud, discussed the placement of CSI consultants on AT & T's projects and directly negotiated the itemized fee for each consultant, including hourly rates, benefits, and commissions. They also contemplated that, if the projects continued, AT & T could hire CSI's consultants, either for a fee within six months of placement or without any fee thereafter.

AT & T's internal procurement policy mandates that it contract only with "preferred" vendors. So, when the parties sought to memorialize their arrangement, one of AT & T's preferred vendors, Real Soft, Inc. (RSI), was interposed as an intermediary contracting party. AT & T and RSI had a pre-existing General Agreement pursuant to which RSI provided AT & T with supplemental technical staff — either its own or subcontractors — and related administrative support services, such as invoicing. The General Agreement entitled AT & T to offer permanent employment to any consultant in consideration for a specified fee during the first year of an assignment or without any fee after one year. The General Agreement also entitled AT & T to assign its contractual obligations to a third party.

Downstream, RSI and CSI executed a Subcontract dated January 2000 pursuant to which CSI (defined therein as "Subcontractor") would provide its consultants "to RSI's client, AT & T Corporation," and RSI would invoice AT & T and remit payment to CSI minus a service charge of $3 per consultant hour. The Subcontract contains no reflection of Vogler's and Massud's discussion of right-to-hire fees payable to CSI, but it incorporates by reference the General Agreement between AT & T and RSI entitling RSI to hiring fees within the first year.

In April 2002, AT & T assigned its administrative duties under the General Agreement to ProcureStaff, Ltd., thus interposing another degree of removal between AT & T and CSI. Under this arrangement, RSI submitted consultant invoices to ProcureStaff, which collected payment from AT & T and remitted it to RSI minus a 3.5% commission. RSI passed on the commission to CSI in addition to RSI's own $3/hour service charge. In addition, following an exchange between Vogler and Massud regarding the waiver of placement fees, RSI informed CSI in writing that it would not seek to collect the placement fees to which it was entitled under the General Agreement for 25 CSI consultants whom AT & T hired prior to their first anniversary on assignment.

In May 2002, CSI filed suit against RSI for breach of contract, seeking damages and rescission. CSI's attempts to join AT & T and ProcureStaff as parties in that action were unsuccessful. In June 2003, CSI and RSI entered into a settlement agreement intended to resolve all disputes relating to the payment of outstanding invoices, the submission and payment of future invoices, the allocation of ProcureStaff fees, and the waiver of hiring fees. The settlement also contained a mutual release discharging each party from further liability arising from the subject matter of the underlying lawsuit.

In August 2003, CSI filed a motion to enforce the settlement against RSI. One month later, CSI filed the present action against AT & T on five counts: (I) tortious interference, (II) quantum meruit, (III) breach of contract, (IV) negligent misrepresentation, and (V) suit on account. The trial court consolidated the two cases and, in December 2006, entered its judgments (1) in favor of CSI with respect to the settlement, ordering RSI to pay $110,000 in damages and $25,000 in attorney fees and (2) in favor of AT & T on its motion for summary judgment on all five counts. CSI appeals the latter, claiming essentially that genuine issues of material fact exist with respect to each count.

Discussion

Preservation

As a preliminary matter, AT & T urges this court to dismiss CSI's appeal for failure to comply with Rule 84.04(d). Specifically, CSI's point relied on states, "The trial court erred in granting summary judgment in favor of defendant AT & T on all counts of plaintiff's five count petition because the evidence, viewed in a light most favorable to plaintiff, demonstrated that plaintiff was entitled to the relief and damages sought." A brief impedes disposition on the merits when it is so deficient that it fails to give notice to this court and to the other parties as to the issues presented on appeal. Wilkerson v. Prelutsky, 943 S.W.2d 643, 647 (Mo. 1997). Here, we are able to ascertain the gist of CSI's arguments despite the shortcomings of its brief. As a matter of policy, the court prefers to decide cases on their merits whenever possible and therefore elects to review this appeal ex gratia. Id.

Standard of Review

"The purpose of summary judgment is to resolve cases in which there is no `genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law.' Rule 74.04(c)(6)." Grattan v. Union Elec. Co., 151 S.W.3d 59, 61 (Mo.2004). A genuine dispute exists where the record contains competent evidence of plausible but contradictory accounts of essential facts. ITT Commercial Finance Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 382 (Mo.1993). Where the "genuine issues" raised by the non-movant are merely argumentative or imaginary, summary judgment is proper. Id. Appellate review of summary judgment is de novo, viewing the record in the light most favorable to the party against whom judgment was entered. Id. at 376.

AT & T asserted seven theories in support of its motion for summary judgment. The trial court's judgment does not identify the basis for its ruling. "A trial court's order is presumed to have based its decision on the grounds specified in respondents' motion if the trial court's order does not set forth its reasoning." Central Missouri Elec. Co-op. v. Balke, 119 S.W.3d 627, 635 (Mo.App. W.D.2003). "Where a trial court has granted summary judgment without specifying the basis upon which the motion was granted, this court will affirm the grant of summary judgment under any appropriate theory." Id. We address each theory in the order presented by the parties.

Release Under Settlement Agreement

First, AT & T claims that it was released from any liability to CSI by virtue of the Settlement Agreement between CSI and RSI. AT & T characterizes the agreement as a general release disposing of "the whole subject matter or cause of action," even as to non-parties. Liberty v. J.A. Tobin Construction Co., Inc., 512 S.W.2d 886, 890 (Mo.App.1974). AT & T also cites language in the Settlement Agreement releasing not only the signatory entities but also "all persons acting by, through or under them." We find dubious the inference that AT & T conferred upon RSI such agency authority to impute AT & T as a party or beneficiary.¹ The document is titled Mutual Release and Settlement Agreement and names only CSI and RSI as Parties.

Interpretation of a release is governed by the same principles applicable to any other contractual agreement, and the primary rule of construction is to give effect to the parties' intent, which is to be determined solely from the four corners of the contract itself. Crumbaker v. Zadow, 151 S.W.3d 94, 97-98, (Mo.App. E.D.2004). A release which, on its face, does not apply to claims against a party who was not a signatory to the agreement, and who has not been shown to be otherwise subject to its terms or intended to be included in the scope of the release, does not apply to that party. Id. "Any question regarding the scope and extent of the release is to be resolved according to what may fairly be said to have been within the contemplation of the parties at the time the release was given. This, in turn, is to be resolved in light of all the surrounding facts and circumstances under which the parties acted." Andes v. Albano, 853 S.W.2d 936, 941 (Mo.1993). The record provides no indication that CSI or RSI intended or even contemplated that their mutual settlement agreement would result in a general release benefiting AT & T. AT & T's first theory does not support summary judgment.

Collateral Estoppel

As its second theory for summary judgment, AT & T argued that CSI is barred from relitigating counts II (quantum meruit), III (breach of contract), and V (action on account) by virtue of the doctrine of collateral estoppel. "Before giving preclusive effect to a prior adjudication under collateral estoppel principles, the Court must consider four factors: (1) whether the issue decided in the prior adjudication was identical to the issue presented in the present action; (2) whether the prior adjudication resulted in a judgment on the merits; (3) whether the party against whom estoppel is asserted was a party or was in privity with a party to the prior adjudication; and (4) whether the party against whom collateral estoppel...