Hermelink v. Dynamex Operations East, Inc.

Decision Date09 June 2000
Docket NumberNo. 99-2335-JWL.,99-2335-JWL.
Citation109 F.Supp.2d 1299
PartiesJack J. HERMELINK, Plaintiff, v. DYNAMEX OPERATIONS EAST, INC., Defendant.
CourtU.S. District Court — District of Kansas

James E. Kunce, Overland Park, KS, for Plaintiff.

Benjamin F. Mann, Kathryn B. Bussing, Blackwell Sanders Peper Martin LLP, Kansas City, MO, for Defendant.


LUNGSTRUM, District Judge.

This suit arises from an independent contractor agreement entered into by plaintiff, Jack Hermelink, and defendant, Dynamex Operations East, Inc., for the operation of a delivery truck. Plaintiff alleges that on September 8, 1998, he entered into an oral agreement with defendant to drive a dedicated delivery route. On that same day, defendant's agent presented him with a written contract which purportedly set forth the terms of the parties' oral agreement. Plaintiff signed the written contract without reading it, and now claims that the writing was materially different from the parties' oral agreement. Alleging that he was induced to sign the contract by defendant's fraud, in Count I of his complaint plaintiff asks the court to reform the contract to comport with the parties' true agreement. Alternatively, in Count II of his complaint, plaintiff seeks damages for breach of the contract as written, claiming that his termination was not in accordance with the contract's terms.1 Moreover, plaintiff brings two tort claims against defendant, alleging negligent misrepresentation in Count III and fraudulent misrepresentation in Count IV.

Now the matter is before the court on defendant's motion for summary judgment on all counts (Doc. 22). For the reasons set forth below, defendant's motion for summary judgment is granted to the extent that Count II is dismissed in part and is denied as to the remaining counts.

I. Background2

Prior to September 8, 1998, plaintiff was employed by Bill Lane, an independent contractor, who, in turn, had a contract with defendant, to drive a straight-truck delivery route five nights each week from Gardner, Kansas to Springfield, Missouri. On the evening of September 8, 1998, however, plaintiff was approached by defendant's agent, Rick Hanna, as plaintiff was preparing to leave on his route. Mr. Hanna informed him that Mr. Lane's contract had been terminated. Mr. Hanna then asked plaintiff if he would be interested in retaining the route directly as an independent contractor. Mr. Hanna described the arrangement as a three-year, $125,000 per year contract. Plaintiff would be required to pay for his own fuel and pager, and would lease the straight-truck which he had been driving for Mr. Lane from defendant. Plaintiff orally accepted the offer. Mr. Hanna then went into his office and retrieved a written contract, which he presented to plaintiff for his signature. Plaintiff began to read the contract, but was stopped by Mr. Hanna who insisted that there was no time for plaintiff to read it; Mr. Hanna directed plaintiff to either sign the document immediately and start his route or leave the job. Expressing concern about signing a document without "knowing what was in it," plaintiff asked Mr. Hanna to "rundown what's in it." J. Hermelink Depo. at 24. Mr. Hanna responded by reciting the terms of the oral agreement previously discussed. Mr. Hanna also told plaintiff that he would receive a copy of the written contract with his next pay check. Plaintiff initialed each page of the contract and signed it, then departed on his route.

Over the next few months, plaintiff drove the route without incident, even though defendant had never provided him a copy of the written contract. In December 1998 or early January 1999, however, plaintiff learned that the Springfield route would be modified to require a tractor-trailer rig. Mr. Hanna informed him that, in order to maintain his route, he would have to purchase a tractor-trailer and obtain a Class A commercial driver's license. Plaintiff began searching for financing which would enable him to purchase the tractor-trailer, but found that potential lenders were unwilling to assist with the purchase until they saw a copy of plaintiff's contract with defendant. Plaintiff asked Mr. Hanna for a copy of the contract daily, but the contract was not produced. Without a tractor-trailer, plaintiff was unable to take the driving portion of the test for a Class A commercial driver's license.

On Friday, February 5, 1999, Mr. Hanna told plaintiff that it would be his last day because a tractor-trailer team would start the new route on the following Monday. When plaintiff again asked for a copy of the written contract, Mr. Hanna responded that the contract had just been found and provided plaintiff with a copy. After reviewing the document, plaintiff discovered that it contained substantially different provisions from the oral agreement entered into by the parties. Plaintiff filed this suit on August 3, 1999.

II. Summary Judgment Standards

Summary judgment is appropriate if the moving party demonstrates that there is "no genuine issue as to any material fact" and that it is "entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In applying this standard, the court views the evidence and all reasonable inferences therefrom in the light most favorable to the nonmoving party. See Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir.1998) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)). A fact is "material" if, under the applicable substantive law, it is "essential to the proper disposition of the claim." Id. (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). An issue of fact is "genuine" if "there is sufficient evidence on each side so that a rational trier of fact could resolve the issue either way." Id. (citing Anderson, 477 U.S. at 248, 106 S.Ct. 2505).

The moving party bears the initial burden of demonstrating an absence of a genuine issue of material fact and entitlement to judgment as a matter of law. See Id. at 670-71. In attempting to meet that standard, a movant that does not bear the ultimate burden of persuasion at trial need not negate the other party's claim; rather, the movant need simply point out to the court a lack of evidence for the other party on an essential element of that party's claim. See Id. at 671 (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)).

Once the movant has met this initial burden, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial." Anderson, 477 U.S. at 256, 106 S.Ct. 2505; see Adler, 144 F.3d at 671 n. 1 (concerning shifting burdens on summary judgment). The nonmoving party may not simply rest upon its pleadings to satisfy its burden. See Anderson, 477 U.S. at 256, 106 S.Ct. 2505. Rather, the nonmoving party must "set forth specific facts that would be admissible in evidence in the event of trial from which a rational trier of fact could find for the nonmovant." Adler, 144 F.3d at 671. "To accomplish this, the facts must be identified by reference to affidavits, deposition transcripts, or specific exhibits incorporated therein." Id.

Finally, the court notes that summary judgment is not a "disfavored procedural shortcut;" rather, it is an important procedure "designed to secure the just, speedy and inexpensive determination of every action." Celotex, 477 U.S. at 327, 106 S.Ct. 2548 (quoting Fed.R.Civ.P. 1).

III. Choice of Law

As an initial matter, the court must determine what law governs plaintiff's claims. A federal court sitting in diversity must apply the substantive law of the state in which it sits, including that state's choice of law rules. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). Thus, the court must look to Kansas law to determine which state's laws should be applied to each claim.

In Count I of his complaint, plaintiff seeks reformation of the written contract. The written contract contains an express choice-of-law provision whereby the parties' rights and obligations under the contract are to be construed "in accordance with the laws of the State of Missouri." Contract, Pl's Ex. A at ¶ 10. The court applies the forum state's rule regarding the enforceability of a choice of law provision. See Equifax Servs., Inc. v. Hitz, 905 F.2d 1355, 1360 (10th Cir.1990). Kansas courts generally give effect to such provisions if the forum selected bears a reasonable relation to the contract at issue. See National Equipment Rental, Ltd. v. Taylor, 225 Kan. 58, 587 P.2d 870, 873 (1978); see also Atchison Casting Corp. v. Dofasco, Inc., 889 F.Supp. 1445, 1455 (D.Kan.1995); Altrutech, Inc. v. Hooper Holmes, Inc., 6 F.Supp.2d 1269, 1273 (D.Kan.1998). Implicit in the holdings of cases applying Kansas law to give effect to contractual choice of law provisions, however, is the premise that the choice of law provision was freely entered into by the parties. See, e.g., National Equipment Rental, Ltd., 587 P.2d at 873 (holding that the "Parties had a right to agree" that New York law would govern their disputes arising out of the contract) (emphasis added); Equifax, 905 F.2d at 1360 (holding that "the parties themselves have agreed" to a choice of law provision) (emphasis added); SBKC Service Corp. v. 1111 Prospect Partners, L.P., 153 F.3d 728, 1998 WL 436579, *2 (10th Cir. July 30, 1998) ("The Kansas choice of law rules honor an effective choice of law made by the contracting parties.") (emphasis added). The premise of plaintiff's reformation claim, in contrast, is that the written contract contained provisions which were not agreed upon by the parties. One such provision was the choice of law provision. Since the parties dispute whether the written choice of law provision was freely entered into, the court does not believe that Kansas courts would apply the...

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