Forbes v. Nationwide Mut. Ins. Co.
| Citation | 2020 Ohio 2802,154 N.E.3d 521 |
| Decision Date | 05 May 2020 |
| Docket Number | No. 19AP-220,19AP-220 |
| Parties | Ruth FORBES, Plaintiff-Appellant, v. NATIONWIDE MUTUAL INSURANCE COMPANY, Defendant-Appellee. |
| Court | Ohio Court of Appeals |
On brief: James R. Leickly, Columbus, and William P. Tedards, Jr., for appellant. Argued: William P. Tedards, Jr.
On brief: Bricker & Eckler LLP, Quintin F. Lindsmith, and Ali I. Haque, Columbus, for appellees. Argued: Ali I. Haque.
DECISION
{¶ 1} Plaintiff-appellant Ruth Forbes appeals from the decision of the Franklin County Court of Common Pleas granting summary judgment in favor of Nationwide Mutual Insurance Company ("Nationwide") on her breach of contract and conversion claims. We conclude after reviewing the matter afresh ("de novo") that Nationwide was entitled to summary judgment on each claim, and accordingly we affirm the judgment of the trial court.
{¶ 2} The trial court's March 13, 2019 Decision and Entry thoroughly lays out the relevant facts as reflected in the record. Ms. Forbes and Nationwide entered into two agreements in June of 2006 that governed her performance selling Nationwide insurance policies from her Virginia office. The first was the Independent Contractor Agent's Agreement, or "IC Agreement," that appointed Ms. Forbes "as an agent to represent [Nationwide] in Virginia." See Third Amended Complaint, Ex. 2. Nationwide agreed to provide Ms. Forbes "with certain manuals, forms, records, and such other materials and supplies as are necessary in the conduct of an insurance business," but specified that "[a]ll such property * * * shall remain the property of [Nationwide] and shall be returned to [Nationwide] in good condition upon any cancellation of" the IC Agreement. Id. at ¶ 1. The agreement also stated: "Upon termination of this Agreement, you agree to return all Confidential Information, and all copies thereof, to [Nationwide] immediately." Id. at ¶ 7. Confidential Information included "customer policy information." Id.
{¶ 3} The second agreement was the Agency Executive Program Performance Agreement, or "AE Agreement," relating to the performance levels that Nationwide required Ms. Forbes to meet. See May 22, 2017 Third Amended Complaint, Ex 1. The sales marks were set forth in the "Minimum Production Plan" attached to the original AE Agreement (but not attached to this document in the record). The AE Agreement stated: Id. at 1-2. "DWP" referred to Total Direct Written Premium, defined as "[t]he sum of all of Agent's direct written premiums from Nationwide Property/Casualty policies." Id. at 1.
{¶ 4} In its original iteration, the AE Agreement provided a "Production Period" of 36 months that could be extended by Nationwide in its discretion for "up to three * * * months if Agent [Forbes] is not meeting the Minimum Production Plan during the final three (3) months of the original Production Period." Id. Ms. Forbes "further agree[d] * * * that failure to meet the requirements of the Minimum Production Plan may result in termination of Agent's Nationwide Agent's Agreement." Id. at 2. Ms. Forbes also agreed to "meet the requirements of a training and development program" consisting of "continuing education on the products, coverages, and regulations that govern [the insurance] industry." Id. at 5. Also pursuant to the agreement, Nationwide extended an interest-free loan to Ms. Forbes, and provided her the opportunity, conditioned on her attaining certain sales goals in relation to the Minimum Production Plan, to have at least some of the loan balance forgiven. Id. at 3-5. Shortly after entering into the AE Agreement, Ms. Forbes executed a promissory note to Nationwide in the amount of $258,000. May 7, 2014 Complaint, Ex. 3.
{¶ 5} The parties formally modified that AE Agreement three times. They entered into the First Modification on April 24, 2008. See Third Amended Complaint, Ex. 3. The First Modification extended the Production Period to 72 months, provided a graduated Modified Minimum Production Plan that set a final DWP requirement of $1,749,880 (for month 72), provided for periodic "capital infusion" payments in lieu of "further Loan disbursements" upon meeting certain production goals, and specified the education and development courses that Ms. Forbes was required to complete. Id. at 2, 8, Ex. A, Ex. C, and Ex. D. In addition, the First Modification altered the language governing the calculation of DWP: Id. at 3.
{¶ 6} As so modified, the Agreement again specified that: "All requirements of the Modified Minimum Production Plan must be met on a monthly basis throughout the term of this Agreement." Id. It set out increasing month-by-month DWP requirements through month 72. Id. at Attachment A. It also recited that "[i]n order to successfully complete the Modified AE Program, Agent understands and agrees that Agent must: (1) meet or exceed the Year 6 P&C DWP on or before the conclusion of the seventy-two (72) month production period; [and] (2) complete all education and development requirements * * *." Id. at 4. The First Modification also provided that Ms. Forbes would "release[ ] and discharge[ ] Nationwide * * * of any and all claims or causes of action * * * in any way relating to the AE Program, the AE Agreement, and the IC Agreement from the beginning of time to the present * * *." Id. at 11.
{¶ 7} "Somewhere around October of 2008," Ms. Forbes began to believe that there was a discrepancy between the DWP amounts with which she thought she should be credited and the amounts actually reflected in Nationwide's reports. See, e.g., Forbes Deposition at 229. She communicated her concerns about Nationwide's calculations to her sales manager, Gary Edgerton, at that time, and continued to track the perceived differences and communicate with Nationwide about the issue until the end of her tenure as an agent. Id. at 71, 96-98.
{¶ 8} On June 17, 2010, the parties once again altered Ms. Forbes's production requirements. The Second Modification to the AE Agreement "canceled and replaced" the First Modification's Modified Minimum Production Plan attachment with a new one that specified new, lower monthly DWP requirements, ending with a month-72 figure of $1,537,428. Third Amended Complaint, Ex. 4 at 1, Ex. A. Like the First Modification, the Second Modification contained a release requiring Ms. Forbes to release and discharge "all claims or causes of action Agent has in any way relating to the AE Program, the AE Agreement, and the IC Agreement from the beginning of time to the present * * *." Id. at 2.
{¶ 9} Ms. Forbes says that she received a communication from Nationwide on March 30, 2012, confirmed by email of February 19, 2013, stating that while the Second Modification had changed her "minimum production requirements to $1,537,428 in Nationwide DWP at the end of Month 72," she "would be eligible to transition to career status if [she] met 95%" of that figure; specifically, she would qualify if she were to achieve "$1,460,556.60 in Nationwide DWP, [have] completed all of [her] Training and Development requirements and [have] passed [her] fiduciary audit." See October 27, 2017 Memorandum in Opposition to Summary Judgment, Ex. 2.
{¶ 10} On May 18, 2012, Nationwide sent Ms. Forbes a demand letter stating that her loan had been "deemed non-collectable" by the guarantor and that her "outstanding debt" owed was $183,481.82. Ms. Forbes had stopped making payments, believing that Nationwide was basing the payment amounts on "incorrect" calculations of DWP. Forbes Deposition at 13 ().
{¶ 11} The parties then executed their Third Modification to the AE Agreement in September 2012. See Forbes Deposition, Ex. 10 and Appellant's Brief at 10-11 (). The Third Modification, acknowledged as supported by "good and valuable consideration," Third Modification at 1, again specified that the Production Period as contained in the AE Agreement as modified by the First Modification would "end at the conclusion of the sevent[y]-second (72nd) full month," but altered that period so as "to suspend Agent's seventy-two month production schedule for the six month period beginning February 1, 2012 and ending July 31, 2012." The agreed result was that Ms. Forbes's "production schedule * * * will conclude at the end of the seventy-second (72nd) month, which [accounting for the suspended period] is March 31, 2013." Id. Like the previous modifications, the Third Modification contained a release of claims, but Ms. Forbes crossed out the release language, initialed the crossed-out provision, and signed the document on September 10, 2012. Id. Nine days later, a Nationwide Regional Vice-President initialed the crossed-out release and signed the Third Modification. Id.
{¶ 12} Nationwide terminated the IC Agreement and the AE Agreement in May of 2013, citing Ms. Forbes's failure to meet the Modified Minimum Production Plan requirements....
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