Dalton v. Cellular South, Inc.
| Decision Date | 16 September 2008 |
| Docket Number | No. 2007-CA-00750-COA.,2007-CA-00750-COA. |
| Citation | 20 So.3d 1242 |
| Parties | Gregory S. DALTON, Individually and d/b/a Louisville Electronics, Appellant, v. CELLULAR SOUTH, INC., Appellee. |
| Court | Mississippi Court of Appeals |
William Liston, Winona, Dewitt T. Hicks, Columbus, John M. Montgomery, Sara E. Woodrell, attorneys for appellant.
Charles L. McBride, Anne C. Sanders, Katie L. Wallace, Jackson, attorneys for appellee.
EN BANC.
ROBERTS, J., for the Court.
¶ 1. Cellular South, Inc., sued Gregory S. Dalton and sought a declaratory judgment. Cellular South claimed it properly terminated its agency relationship with Dalton. After discovery, both parties filed motions for summary judgment. The Winston County Circuit Court found that the agreement between Dalton and Cellular South was unambiguous and granted summary judgment on behalf of Cellular South. Aggrieved, Dalton appeals and claims the circuit court erred when it granted Cellular South's motion for summary judgment. Dalton also claims the circuit court erred when it denied his motion for partial summary judgment. Finding no error, we affirm the judgment of the circuit court.
FACTS
¶ 2. Dalton owned a Radio Shack in Louisville, Mississippi. In April 1992, Dalton entered into an agreement with Cellular South to work as an agent selling cellular telephone service. Cellular South drafted the initial agreement, which was replaced in March 1993. It is unclear whether Dalton had any input as to the terms of either agreement. Dalton's agency relationship with Cellular South lasted for thirteen years. During that time, Dalton procured over six thousand customers for Cellular South. In return, Dalton received substantial commissions for his sales of Cellular South subscriptions.
¶ 3. In December 2003, Terrell Knight, then director of sales for Cellular South, sent Dalton a letter informing him that his agreement with Cellular South was being terminated effective February 6, 2004, as a result of "a reorganization of Cellular South's retail distribution plan...." Cellular South also sent Dalton a full and final release. Dalton refused to sign the full and final release.
¶ 4. Cellular South filed suit against Dalton, requesting a declaratory judgment to the effect that it had not acted contrary to the terms of the agency agreement. As mentioned, both parties filed motions for summary judgment. The circuit court ultimately granted Cellular South's motion for summary judgment. Additionally, the circuit court denied Dalton's motion for partial summary judgment. Additional facts will be discussed as necessary.
ANALYSIS
WHETHER THE CIRCUIT COURT ERRED WHEN IT GRANTED CELLULAR SOUTH'S MOTION FOR SUMMARY JUDGMENT.
¶ 5. Summary judgment is properly granted when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Glover ex rel. Glover v. Jackson State Univ., 968 So.2d 1267, 1274(¶ 18) (Miss.2007) (quoting M.R.C.P. 56(c)). As explained by the Mississippi Supreme Court, "the court must grant summary judgment unless—as to each material issue of disputed fact raised by the moving party—the record demonstrates at least the minimum quantum of evidence sufficient to justify a determination in favor of the non-moving party by a reasonable juror." Id. at 1274(¶ 19). We will view all of the evidence "in the light most favorable to the party against whom the motion has been made...." Thomas v. The Columbia Group, LLC, 969 So.2d 849, 852(¶ 10) (Miss.2007).
¶ 6. At the outset, we quote at length from the relevant portions of the contract between Dalton and Cellular South:
3.1 Term: The term of the Agreement shall be one year, commencing on the date specified in Exhibit D of this Agreement, unless otherwise terminated or renewed pursuant to the provisions hereinafter provided. Cellular Holding1 is cognizant of the increasing value of the Agency relationship to a successful AGENT and therefore will terminate a successful Agency relationship only if Cellular Holding determines that the continuation of the Agency relationship would be detrimental to the overall well[-]being, reputation and goodwill of Cellular Holding.
....
3.4 Default: In the event AGENT fails to perform any of its obligations under this Agreement and such failure continues unremedied for a period of thirty (30) days after written notice is given by Cellular Holding to AGENT, then Cellular Holding may thereupon elect to cancel and terminate this Agreement, which termination shall be effective immediately upon the expiration of said thirty-day period.
3.5 Termination: Either party may terminate this Agreement by giving the other party written notice of its desire to terminate at least thirty (30) days prior to the intended date of termination.
[The section goes on to list specific instances under which Dalton's conduct could result in termination by Cellular South.]
....
4.6 Sales Activity: AGENT shall act as a sales AGENT appointed by Cellular Holding for Cellular Holding's Cellular Telephone Service. AGENT shall provide appropriate sales facilities and use its best efforts to enhance the sale of Cellular Holding service and to solicit customers using administrative procedures established from time to time by Cellular Holding;
....
(Emphasis added).
¶ 7. Dalton claims that the court erred by failing to follow the proper rules of contract construction. Specifically, Dalton complains that the court "erred in its negotiation of the three-tiered approach by determining that the Agreement was unambiguous based on matters outside the four corners of the instrument, namely, the self-serving Affidavit of Hu Meena...."
¶ 8. Mississippi uses "a three-tiered approach to contract interpretation." One South, Inc. v. Hollowell, 963 So.2d 1156, 1162(¶ 10) (Miss.2007) (quoting Facilities, Inc. v. Rogers-Usry Chevrolet, Inc., 908 So.2d 107, 111(¶ 7) (Miss.2005)). As explained by the Mississippi Supreme Court:
First, the "four[-]corners" test is applied, wherein the reviewing court looks to the language that the parties used in expressing their agreement.... We must look to the "four corners" of the contract whenever possible to determine how to interpret it. McKee v. McKee, 568 So.2d 262, 266 (Miss.1990). When construing a contract, we will read the contract as a whole, so as to give effect to all of its clauses. Brown v. Hartford Ins. Co., 606 So.2d 122, 126 (Miss.1992).
Our concern is not nearly so much with what the parties may have intended, but with what they said, since the words employed are by far the best resource for ascertaining the intent and assigning meaning with fairness and accuracy.... On the other hand, if the contract is unclear or ambiguous, the court should attempt to "harmonize the provisions in accord with the parties' apparent intent." Pursue Energy Corp. [v. Perkins], 558 So.2d [349,] 352 [(Miss. 1990)]. Only if the contract is unclear or ambiguous can a court go beyond the text to determine the parties' true intent. Id.
Id. (quoting Facilities Inc., 908 So.2d at 111(¶ 7) (emphasis in original)). If the four corners of the contract fail to yield a clear understanding, the court then looks at the canons of contract construction and parol evidence if necessary. Id. at 1162-63(¶ 10) (quoting Facilities Inc., 908 So.2d at 111(¶ 7)).
¶ 9. Our review of the circuit court's opinion reveals that Dalton is mistaken as to how the court interpreted the agency agreement. The court did not refer to Meena's affidavit in determining whether the contract was ambiguous. Rather, the court determined as follows:
After reading the Agreement and giving effect to all of its clauses this court is satisfied that it is unambiguous and that there is only one reasonable interpretation of the terms for terminating the contract. It is clear to this court that it need not go any further than the first tier of contract interpretation.... The termination terms in the Agreement are unambiguous when read as a whole.
The first sentence of section 3.5 establishes the only way that Dalton may terminate the Agreement. He may terminate the Agreement for any reason as long as he gives thirty (30) days written notice of his intent to terminate.
Cellular South may terminate the Agreement by giving thirty (30) days written notice pursuant to the first sentence in section 3.5, but its reasons for termination are limited by the second sentence in section 3.1. It may terminate the Agreement only if it determines that a continuation of the agency relationship will be detrimental to the overall well[-]being, reputation and goodwill of Cellular South.
....
Dalton has the freedom to terminate the agreement for any reason, or for no reason at all, as long as he gives thirty (30) days written notice to Cellular South. However, Cellular South's right to terminate is limited by the standard in section 3.1. Only if it determines that a continuation of the Agreement would be detrimental to its overall well-being, reputation and goodwill could it terminate the Agreement. However, just as Dalton has the right to terminate the Agreement for the reason of his choosing, Cellular South pursuant to section 3.1 has made itself the sole arbiter of what would be detrimental to its overall well-being, reputation and goodwill. There is nothing in the second sentence of section 3.1 that limits Cellular South's right to terminate the Agreement only in the event that Dalton does something that is detrimental to the overall well-being, reputation and goodwill of the company. "Overall" means company wide, not just the seven counties where Dalton was serving as an agent.
Here, Cellular South for the reasons stated in the affidavit of Hu Meena, decided that a continuation of the agency agreement with Dalton, or with any other agent, would be detrimental to the overall well-being, reputation and good-will of the company. Although Dalton contends that a jury must make the determination as...
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