Pollock v. Berlin-Wheeler, Inc.

• Decision Date: 20 May 2003
• Docket Number: No. WD 60568.,WD 60568.
• Citation: Pollock v. Berlin-Wheeler, Inc., 112 S.W.3d 73 (Mo. App. 2003)
• Parties: Alice POLLOCK, Appellant, v. BERLIN-WHEELER, INC., Respondent.
• Court: Missouri Court of Appeals

112 S.W.3d 73

Alice POLLOCK, Appellant, v. BERLIN-WHEELER, INC., Respondent.

No. WD 60568.

Missouri Court of Appeals, Western District.

May 20, 2003.

Motion for Rehearing and/or Transfer to Supreme Court Denied July 1, 2003.

Application for Transfer Denied August 26, 2003.

Daniel E. Hunt, Jefferson City, for appellant.

Cathleen A. Martin, Jefferson City, for respondent.

Before: LOWENSTEIN, P.J., ULRICH, J. and STEELE, Sp.J.

HAROLD L. LOWENSTEIN, Judge.

This is a court tried case stemming from the breach of a contract for employment. The plaintiff-appellant, Alice Pollock, and Berlin-Wheeler entered into a contract where Pollock, who ran an executive recruiting business, was to be the employee of the respondent, which ran an employment agency. Pollock was to devote fulltime to the respondent and be paid a salary plus a percentage of commissions she generated. She was terminated over her failure to report commissions generated, and she filed this suit to collect other commissions she claimed were hers under the contract. Pollock, among other things, sought damages for not receiving timely notice of termination and for her moving expenses. Berlin-Wheeler's counterclaim sought damages for lost commissions and for money paid. The judgment awarded a net amount of $2,162.50 to Berlin-Wheeler. Only Pollock appealed.

I. Facts

On August 14, 1998, Alice Pollock, the appellant, entered into an employment contract with Berlin-Wheeler, Inc., the respondent, to help find jobs for customers of Berlin-Wheeler. Berlin-Wheeler operated as "Decker and Decker."

Pollock's contract included the following terms:

1. Employment and duties. Decker agrees to employ Ms. Pollock to perform professional services as a certified professional consultant, specializing in employment placements. Ms. Pollock shall work full time for Decker as a certified personnel consultant, working in Decker's office in Jefferson City, Missouri. She agrees that she will share her present job candidates and job openings with Decker. She further agrees she will work with and train Decker's employee, Kevin Honeycutt. She further agrees that she will work to develop the contract employee market and assist in the training of Kevin Honeycutt in that market. She further agrees that Decker can use her trade name, First Place Executive Recruiters, and at such time as her employment with Decker may terminate, said trade name will stay with Decker, at its option. Use of the First Place Executive Recruiters trade name shall not be deemed to be an assumption by Decker of Ms. Pollock's business or any liability associated with her business.

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3. Compensation. Decker agrees to pay Ms. Pollock as compensation for her services an annual salary of $35,000.00, payable in twenty-four installments, on the first and fifteenth of each month. In addition, Ms. Pollock shall be paid a commission on fees generated through her efforts (emphasis added). The commission for the first full calendar year, being January 1, 1999 through December 31, 1999, shall be as follows: 15% on the first $100,000.00 of fees generated through her efforts; 25% on the next $45,000.00; and 50% on fees over $145,000.00. Thereafter, beginning January 1, 2000, Ms. Pollock's commission, in addition to her salary, shall be 25% on the first $125,000.00 and 50% on the total fees above $125,000.00

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6. Conduct of Ms. Pollock. Ms. Pollock agrees to perform her services and duties in compliance with the usual and customary standards for her profession.

The memorandum of their agreement had a merger clause. It also provided that either party could terminate the agreement by giving thirty days notice.

Pollock began working for Berlin-Wheeler on September 14, 1998, as required by the contract. Sometime thereafter, Pollock placed Melissa Legge with Cardinal Scale & Manufacturing Company, though Pollock had tried to place Legge before working for Berlin-Wheeler. To make the placement, Pollock used a fax machine at Berlin-Wheeler to send Legge's resume to Cardinal Scale. Scale hired Legge on October 12, 1998; Legge began working the next day. Pollock later received an $8,125 check from Cardinal Scale for her role in the placement. Pollock deposited the check into her business's account and paid another company half the check amount. She did not notify Berlin-Wheeler of the placement nor of her receipt of the check. Berlin-Wheeler's evidence, through its agent, was that Pollock was at work for at least forty hours a week but that she spent some of her time working for her own business.

On November 14, 1999, Berlin-Wheeler terminated Pollock without giving the required thirty days notice. Pollock did not receive $3000 that she otherwise would have been paid had she not been terminated nor did she receive any further commissions, though Honeycutt had made placements during the thirty days after Pollock's termination.

Pollock filed this breach of contract suit, seeking, damages of $3,000 in salary (representing her failure to receive a one month notice of termination); $13,675 in commissions (without specifying the dates they were earned); costs and expenses stemming from her termination, including $111.30 of unpaid insurance and $1,050 for her moving expenses (the contract of employment had provided $2,000 reimbursement for her expenses in moving to Jefferson City); and attorneys fees plus interest from December 2, 1999.

In its answer, Berlin-Wheeler countered that Pollock's conversion of the placement check estopped Pollock from recovering back-pay and commissions. Berlin-Wheeler also raised two other affirmative defenses, namely, that Pollock had defrauded Berlin-Wheeler and that Pollock waived her right to compensation by converting the Cardinal Scale check. Berlin-Wheeler prayed for a set-off of $11,556.80, equal to the sum of the unemployment compensation Pollock had drawn from Berlin-Wheeler, and counter-claimed for breach of contract (seeking damages for Pollock's failure to disclose the placement of Legge), for conversion of the placement check, for "a pattern of action against the best interests of [Berlin-Wheeler]," and for fraud. The total actual damages of $11,556.80 sought by respondent were—$8,125 (amount of the check) and $3,431.80 (unemployment compensation)—and an unspecified amount of punitive damages (presumptively stemming from the conversion and fraud claims).

The trial court made the following conclusions: (1) Pollock had not proved by a preponderance of the evidence that Berlin-Wheeler owed her commissions; (2) Berlin-Wheeler was liable for breach of contract because it had not given Pollock a thirty-day notice before terminating her and thus owed Pollock $3,000 in back-pay; and Pollock owed Berlin-Wheeler $1,100, the amount of unemployment compensation, leaving $1,900 due Pollock from Berline-Wheeler on the termination issue; (3) Pollock was thus liable to Berlin-Wheeler for $1900; (5) Pollock was not entitled to moving expenses because she would have had to pay for them whether she had been terminated or not; and (6) Pollock owed Berlin-Wheeler $4062.50 as a commission for placing Legge. Judgment was for Berlin-Wheeler in the amount of $2,162.50.

II. Standard of Review

In reviewing a court-tried case, the judgment of the trial court must be affirmed unless there was insufficient evidence to support it, it was against the weight of the evidence, or it either misapplied or misconstrued the law. Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). All evidence and inferences favorable to the prevailing party are accepted as true and all contrary facts and inferences are disregarded. Judy v. Judy, 998 S.W.2d 45, 49 (Mo.App.1999). If the grounds upon which the trial court based its judgment are erroneous, an appellate court may nonetheless affirm the judgment on any pleaded theory supported by the evidence. Webcon Group, Inc. v. S.M. Properties, L.P., 1 S.W.3d 538, 541 (Mo.App.1999). (This is true even if the respondent does not raise the theory on appeal, for it is only an appellant (or cross-appellant) who can abandon points by not raising them on appeal. Boyer v. Grandview Manor Care Center, Inc., 793 S.W.2d 346, 347-48 (Mo. banc 1990).)

III. Analysis

Pollock's contention that there was insufficient evidence for the court to find that she had converted the commission check related to Legge's placement is a tenable theory. Nevertheless, the trial court did not err in awarding to Berlin-Wheeler half the amount of the check resulting from the placement of Melissa Legge with Cardinal Scale.

Conversion is the "unauthorized assumption of the right of ownership over the personal property of another to the exclusion of the owner's rights." Mertz v. Blockbuster, Inc., 32 S.W.3d 130, 133 (Mo. App.2000). Notwithstanding this definition, negotiable instruments like checks and promissory notes can be converted. Diversified Developers, Inc. v. Peterson, 41 S.W.3d 48, 48 (Mo.App.2001)(mem.); RESTATEMENT (SECOND) OF TORTS § 242 (1965). Pollock admits to cashing the check and using the proceeds as her own, so the only issue here is whether the record supports the court's implicit finding that Berlin-Wheeler had a superior property interest in the check.

While contracts can create property rights, see Riddle ex rel. Riddle v. Elk Creek Salers, Ltd., 52 S.W.3d 644, 646 (Mo.App.2001) (equitable conversion vests equitable title in vendee upon entering into realty sales contract); Lim v. Cent. DuPage Hosp., 871 F.2d 644, 648 (7th Cir. 1989) (Posner, J.); Norman v. Balt. & Ohio R.R. Co., 294 U.S. 240, 307-08, 55 S.Ct. 407, 79 L.Ed. 885 (1935), Pollock's contract did not transform the placement check into Berlin-Wheeler's property. Nothing in the memorandum of their contract (which this court interprets de novo, Helterbrand v. Five Star Mobile Home Sales, Inc., 48 S.W.3d 649, 658) (Mo.App. W.D.2001) provides for the allocation of payments received because of placements Pollock made after she...