Dye v. Mech. Enterprises Inc.

• Decision Date: 27 June 2011
• Docket Number: No. A10A2220.,A10A2220.
• Citation: 708 S.E.2d 24,308 Ga.App. 311
• Parties: DYEv.MECHANICAL ENTERPRISES, INC.
• Court: Georgia Court of Appeals

308 Ga.App. 311

708 S.E.2d 24

11 FCDR 636

DYE

v.MECHANICAL ENTERPRISES, INC.

No. A10A2220.

Court of Appeals of Georgia.

March 9, 2011.Certiorari Denied June 27, 2011.

Jonathan Robert Poole, Mary M. Brockington, Atlanta, for Appellant.Christopher G. Moorman, Atlanta, for Appellee.ADAMS, Judge.

Plaintiff/appellant William G. Dye brought suit against his former employer, Mechanical Enterprises, Inc. (“MEI”) seeking to recover $127,185.91 in commissions he alleged he was owed pursuant to his contract with MEI and OCGA § 10–1–700 et seq. He also sought attorney fees and expenses of litigation. MEI answered,¹ admitting that Dye had the opportunity while employed there to earn “additional compensation” but denying that any commissions were due and owing to him. Mechanical filed a motion for summary judgment, and the trial court granted the motion following a hearing. Dye appeals.

“Summary judgment is appropriate when no genuine issues of material fact remain and the movant is entitled to judgment as a matter of law. Applying a de novo standard of review, we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant.” (Citation and footnote omitted.) Mathews v. Marietta Toyota, 270 Ga.App. 337, 606 S.E.2d 862 (2004).

Construed in the light most favorable to Dye as the non-movant, the record shows the following pertinent facts: Dye negotiated the terms of his employment with Philip Allgood, the president and CEO of MEI. Pursuant to their negotiations, Allgood sent Dye a letter confirming his compensation as follows: “Due to our current cash flow situation, your starting salary will be $55,000 per year, ... and a monthly commission on shipped transportation sales in accordance with the MEI Sales Policy.” Dye admitted in his deposition that the MEI Sales Policy referenced in the letter “was a policy yet to be written,” and that, pursuant to his discussions with Allgood, the intent was to write a policy that provided more consistency concerning how commissions were computed for sales representatives.

Dye further testified that pursuant to the letter and the parties' oral negotiations prior to his employment, the term “ shipped transportation sales” referred to “any product shipped by MEI for use in transportation” and that his commissions were due at the time the product was delivered to the customer, not the time payment was received from the customer, as was the practice for other sales representatives. He said this was an incentive Allgood offered to ensure that Dye was paid more than the $55,000 salary. He also testified that he was entitled to commissions for all transportation sales that were shipped, whether he generated the sale or not. Additionally, he testified that he and Allgood orally agreed his commission rate would be five percent, and that there was a history at MEI of paying sales representatives five percent commissions, although he also admitted that not all salespersons were paid at that rate. And as further evidence of his five percent commission rate, he also introduced a handwritten note made during a telephone conversation he had with Allgood prior to his employment which contains the notation “5% first year,” as well as documents he contends showed a five percent commission was automatically entered when estimating pricing. Dye testified that while he was entitled to be paid the commissions he had earned on a monthly basis, he never submitted a request for payment while he was employed at MEI because the company was barely making payroll and he was paying expenses out of his own pocket. He also testified that he and Allgood discussed the fact that he would defer his commissions prior to his coming to work at MEI, and that after he came to work at the company Allgood “continuously” reminded him that he had commissions coming because Allgood was concerned that he would leave the company.

Allgood testified that Dye was hired as Vice President of Sales of MEI, and that he was hired to bring in new accounts and new products as well as overseeing the other sales representatives. Allgood testified that the letter reflected the terms under which Dye was hired, including their agreement concerning sales commissions, which was to be in accordance with MEI Sales Policy. As to that policy, Allgood testified that in early June, several months before Dye was hired, the company had decided to standardize the commission agreements for all sales representatives hired after that date because the varying commissions agreements with different sales representatives had become a management problem. He testified that at the time Dye was hired, this sales “policy” was in writing but only in outline form and that he told Dye that one of his first duties would be to put the outline into a formal written policy. He said that under that sales policy, a salesperson would be paid a ten percent commission on any new products ² for the first year, five percent on existing sales for the second year, and three percent “retainage” on mature sales. He said the policy was meant to be a “driver” for new sales. However, Allgood acknowledged that even after the uniform sales policy was instituted, certain employees negotiated separate agreements and were not paid in accordance with that policy. The evidence further shows that following his termination, Allgood sent Dye a letter clarifying his position; in that letter he stated, inter alia, that when Dye was hired, it was under a salary “cap” of $55,000 in effect at that time, “plus a commission on new sales.” The letter further stated that Dye was entitled to commissions on two new accounts, but at the rate of 1.5 percent instead of 5 percent because those sales were to distributors at significantly reduced prices, and that it had never been MEI's policy to pay a five percent commission on sales to distributors.

Based on the foregoing and other evidence of record, it appears undisputed in this case that the parties intended for Dye to be paid a commission. The question then is whether, as MEI contends, that agreement was unenforceable because the letter setting forth the terms of employment did not contain a formula to compute the commission.

In support of its...