Kaye v. Help Desk Now Inc.

• Decision Date: 04 October 2010
• Docket Number: No. 05-08-01708-CV.,05-08-01708-CV.
• Citation: 321 S.W.3d 806
• Parties: KAYE/BASSMAN INTERNATIONAL CORP., Appellant, v. HELP DESK NOW, INC., Appellee.
• Court: Texas Court of Appeals

321 S.W.3d 806

KAYE/BASSMAN INTERNATIONAL CORP., Appellant,

v.HELP DESK NOW, INC., Appellee.

No. 05-08-01708-CV.

Court of Appeals of Texas,Dallas.

Aug. 24, 2010.

Rehearing Overruled Oct. 4, 2010.

COPYRIGHT MATERIAL OMITTED.

Michael K. Hurst, Vanessa Jean Rush, Gruber Hurst Johansen & Hail LLP, Jason A. Copling, Munsch Hardt Kopf & Harr, P.C., Dallas, TX, for Appellant.

Alan Brandt Daughtry, Houston, TX, for Appellee.

Before Justices O'NEILL, LANG-MIERS, and FILLMORE.

OPINION

Opinion By Justice LANG-MIERS.

This appeal arises from a dispute about whether appellee Help Desk NOW, Inc. is required to pay certain commissions to appellant Kaye/Bassman International Corp. After both sides moved for summary judgment, the trial court denied Kaye/Bassman's motion and granted summary judgment in favor of Help Desk NOW. On appeal, Kaye/Bassman argues that the trial court erred when it granted summary judgment in favor of Help Desk NOW and denied summary judgment in favor of Kaye/Bassman. We reverse the trial court's summary judgment in part, affirm in part, and remand this cause to the trial court for further proceedings consistent with this opinion.

Background

The Parties

Help Desk NOW is in the call-center business and contracts with companies to provide call centers for customer service and technical support relating to a company's products or services. Kaye/Bassman is a recruiting and staffing firm that places sales people and executives with clients in various industries, including the call-center industry. According to Kaye/Bassman, it also brings business to its clients who run call centers by introducing those clients to Kaye/Bassman's industry contacts who are aware of companies that need a call center.

Matt Sherman and Synchronoss Technologies, Inc.

Although the parties apparently disagree about the purpose of the introduction, they agree that Kaye/Bassman introduced Help Desk NOW to a man named Matt Sherman. ¹ Sherman subsequently introduced Help Desk NOW to Synchronoss Technologies, Inc., which ultimately became a call-center client of Help Desk NOW. In exchange for the client referral, Help Desk NOW agreed to pay a commission to Sherman.

The Parties' Agreements

Although the parties also apparently disagree about how, exactly, the agreement came about, they agree that in July 2004, around the time that Sherman introduced Help Desk NOW to Synchronoss, Kaye/Bassman and Help Desk NOW entered into a Call Center Business Agreement (the Original Agreement) governing Help Desk NOW's payment of commissions to Kaye/Bassman. ² The Original Agreement states, in relevant part, as follows:

1. Prospective Clients-[Kaye/Bassman] agrees to refer certain business prospects/clients to Help Desk Now.^{[ 3 ]} [Kaye/Bassman] will earn fees based on the percentage of revenue generated from the production of business prospects/clients introduced by [Kaye/Bassman].

2. Fee paid to [Kaye/Bassman]-Help Desk Now agrees to pay [Kaye/Bassman] 2.5% of the billed revenue that Help Desk Now earns from any and all revenues generated through [Kaye/Bassman] and their efforts on Help Desk Now's behalf. [Kaye/Bassman] will receive payments of these fees as long as Help Desk Now continues to collect on billed revenues from the work introduced by business prospects/clients through [Kaye/Bassman].

...

It is understood and agreed to by both parties that for any specific opportunity the commission structure may be mutually adjusted in order to successfully win the business opportunity.

5. Termination-Either party may terminate this agreement by providing 30 days written notice. [Kaye/Bassman] will continue to receive fee payment as long as Help Desk Now continues to generate revenue from the referral client or referred business.

In October 2004, Synchronoss signed a call-center agreement with Help Desk NOW and became Help Desk NOW's biggest client. Pursuant to the terms of the Original Agreement, Help Desk NOW paid Kaye/Bassman 2.5% of the billed revenue from the Synchronoss account.

Over the next sixteen months, Sherman referred three other clients to Help Desk NOW. Help Desk NOW and Kaye/Bassman entered into two addenda to the Original Agreement to address the commissions to be paid to Kaye/Bassman from revenues generated from the first two of those three clients. They disagreed about whether Kaye/Bassman was entitled to any commission from the third client, CapGemini Energy. To resolve that dispute, the parties entered into a third addendum to the Original Agreement, in which Help Desk NOW agreed to pay Kaye/Bassman 1% of the billed revenue from the CapGemini Energy account. Six months later, in November 2005, the parties signed a fourth and final addendum (the Fourth Addendum) to the Original Agreement. The Fourth Addendum states, in relevant part, as follows:

This Addendum is to both the [O]riginal Agreement between the parties, dated July 27, 2004, and the [Third] Addendum dated May 13, 2005. As part of the agreement between the parties wherein Help Desk NOW would pay Kaye/Bassman for the CapGemini Energy contract, the following stipulations were also agreed upon by both parties and are hereby included in all agreements heretofore consummated by the parties:

1. That any contract that Help Desk NOW enters into with an existing or new Help Desk NOW client will not entitle Kaye/Bassman or Mr. Eddie Hill any [sic] fee or other compensation unless agreed upon in writing in advance of Help Desk NOW entering into such contracts.

...

3. It is expressly understood by both parties that Mr. Matthew Sherman no longer has any business relationship with Kaye/Bassman and/or Mr. Eddie Hill that would encumber Help Desk NOW or prevent Help Desk Now from doing business with Mr. Sherman. If Mr. Sherman brings another deal to Help Desk NOW that results in a contract, neither Kaye/Bassman nor Eddie Hill would be entitled to any fee or other compensation from Help Desk NOW.

4. Help Desk NOW appreciates the involvement it has had with Kaye/Bassman to date and will meet its financial obligations to Kaye/Bassman as per the [Original] Agreement between the parties and the subsequent Addendums, including this one.

5. Help Desk NOW is now aware of how Kaye/Bassman expects to be compensated for future deals that Help Desk NOW may participate in as a result of the efforts of someone that Kaye/Bassman has introduced to Help Desk NOW. Other than any future deals that Matt Sherman may bring to Help Desk NOW, as covered in item 3, above, Help Desk NOW agrees that Kaye/Bassman is entitled to be compensated for the deals that someone that they introduced to us as a client that they represent, and all future deals within a time frame of two (2) years from the date of the last deal that the introduced Kaye/Bassman client helped Help Desk NOW close. The amount and duration of such compensation for all deals will be negotiated between Help Desk NOW and Kaye/Bassman. Unless the Kaye/Bassman client is identified as a Kaye/Bassman client by Kaye/Bassman or by the Kaye/Bassman client prior to Help Desk NOW closing an agreement for services, Help Desk NOW will not be liable for any payments to Kaye/Bassman or any of Kaye/Bassman's employees.

Six months later, in May 2006, Help Desk NOW and Synchronoss entered into an agreement regarding call center services and pricing that superseded all previous agreements between them (the 2006 Synchronoss Agreement). ⁴ For the first few months after the 2006 Synchronoss Agreement was signed, Help Desk NOW continued to pay commissions to Kaye/Bassman for Synchronoss billed revenue.

After that, and for the next few months, Help Desk NOW did not pay those commissions to Kaye/Bassman but repeatedly assured Kaye/Bassman that it would continue to pay those commissions.

In early 2007 Help Desk NOW was sold. The buyers interpreted the Fourth Addendum to mean that it did not owe commissions to Kaye/Bassman for revenues generated from the Synchronoss relationship as of the date of the 2006 Synchronoss Agreement.

This Lawsuit

In May 2007, Help Desk NOW filed this lawsuit seeking a declaratory judgment “as to its rights and obligations with respect to Kaye/Bassman.” In its petition, Help Desk NOW states that because of the Fourth Addendum, Kaye/Bassman is not entitled to any commissions based on the 2006 Synchronoss Agreement. In response, Kaye/Bassman filed (1) an answer asserting a general denial and numerous affirmative defenses, including lack of consideration and (2) a breach-of-contract counterclaim seeking damages for unpaid Synchronoss commissions and attorneys' fees. In its amended answer and counterclaim, Kaye/Bassman alleges that, under the terms of the Original Agreement and the Fourth Addendum, Help Desk NOW is obligated to continue paying Kaye/Bassman 2.5% of all billed revenues generated from the Synchronoss account.

The Motions for Summary Judgment

Help Desk NOW filed a traditional motion for summary judgment under rule of civil procedure 166a(c) in which it argued that it is not obligated to pay commissions to Kaye/Bassman for revenue generated as a result of the 2006 Synchronoss Agreement because of the terms of the Fourth Addendum. Help Desk NOW also filed a no-evidence motion for summary judgment under rule of civil procedure 166a(i) in which it asserted that there was no evidence to support Kaye/Bassman's counterclaim or certain elements of its affirmative defenses.

Kaye/Bassman filed a cross-motion for summary judgment under rule of civil procedure 166a(c) in which it asserted the same three grounds for summary judgment to support its affirmative claim for breach of contract and to oppose Help Desk NOW's competing claim for declaratory judgment: (1) Help Desk NOW breached the Original Agreement by failing to pay commissions on the Synchronoss account, (2) there was no consideration for the Fourth Addendum, and (3) the Fourth Addendum is ambiguous and extrinsic evidence conclusively demonstrates that the parties did not...