Sample v. Kinser Ins. Agency, Inc.

• Decision Date: 19 October 1998
• Docket Number: No. 53A04-9710-CV-423,53A04-9710-CV-423
• Citation: 700 N.E.2d 802
• Parties: Cindy SAMPLE, Appellant-Plaintiff, v. KINSER INSURANCE AGENCY, INC., and James C. Kinser, Appellees-Defendants.
• Court: Indiana Appellate Court

Page 802

700 N.E.2d 802

Cindy SAMPLE, Appellant-Plaintiff, v. KINSER INSURANCE AGENCY, INC., and James C. Kinser,

Appellees-Defendants.

No. 53A04-9710-CV-423.

Court of Appeals of Indiana.

Oct. 19, 1998.

Eric W. Prime, Rori L. Goldman, Hill, Fulwider, McDowell, Funk & Matthews, Indianapolis, for Appellant-Plaintiff.

Michael L. Carmin, Robert T. Drew, Andrews, Harrell, Mann, Chapman & Coyne, P.C., Bloomington, for Appellees-Defendants.

OPINION

RUCKER, Judge.

Cindy Sample ("Sample") filed a two count complaint against James C. Kinser and the Kinser Insurance Agency (referred to collectively as "Kinser Insurance") alleging breach of contract and fraud. As to both counts Kinser Insurance countered with a motion for summary judgment which the trial court granted. Sample now appeals contending the trial court erred in so doing. We affirm in part and reverse in part.

Kinser Insurance does business in Monroe County and among other things is authorized to write insurance policies for the Erie Insurance Company ("Erie"). In fact Erie represents a large part of Kinser Insurance's business. Although the record is unclear as to the exact date, at some point Kinser Insurance employed Sample as an agent. She was paid on a commission basis, the terms and conditions of which were set forth in a written agreement as follows:

1. There will be a $400.00 minium [sic] commission payable monthly unless commissions are in excess of this, then the commission payment will be made vice the minimum.

2. A 75% commission on new business and renewal will be paid to a maximum period of one year and/or six months, depending on the volumn [sic] of business created. At a satisfactory amount of production agreed upon between Cindy Sample and James C. Kinser, the commission will then be reduced to Item # 3 below. It is the intent of this agreement to help the agent achieve a level of personal monetary goals quickly and to help her maintain a productive salary until she gains time in the position and establishes a satisfactory renewal base of business.

3. After the goals of Item # 1 and Item # 2 are achieved and agreed upon, then Item # 3 will take effect. This agreement changes the commission schedule to a 50/50 basis on new and renewal business with assignment to the Kinser Insurance Agency Inc. and all business will belong to the Corporation. The Kinser Insurance Agency Inc. will supply and pay all business cards, office expenses, and equipment as required to perform her duties as an agent of this Agency. Film, gas, and all vehicles expenses are to be supplied by the agent.

R. at 153. Initially Sample was given binding authority to write policies of insurance for Erie as a subagent of Kinser Insurance. In April 1995 James Kinser terminated that authority. The facts are in dispute as to whether Kinser told Sample that Erie was canceling Sample's binding authority or whether Kinser told Sample that Erie was not going to allow her to write anymore business for them. In any event, relying on Kinser's representation Sample quit her job with Kinser Insurance on April 13, 1995. Shortly thereafter Kinser Insurance tendered to Sample a check in the amount of $1,402.81. The amount represented the commissions Sample earned through April 13, 1995. Sample refused the check contending she was entitled also to receive commissions she had generated prior to termination but which had not accrued until after her termination. Unable to reach an agreement concerning the commissions, Sample filed a two count complaint against both James C. Kinser and Kinser Insurance. Count I alleged breach of contract for failure to pay commissions due and owing. Count II alleged fraud for misrepresenting statements allegedly made by Erie. Kinser Insurance responded by filing a Motion for Summary Judgment which the trial court granted after a hearing. In support of its judgment the court entered findings of facts and conclusions of law. This appeal followed.

I.

Kinser Insurance pursued summary judgment on Sample's breach of contract claim on the ground that Sample was not entitled to receive commissions after her employment terminated. The trial court agreed. The construction of an unambiguous written contract is generally a question of law for the court, making summary judgment particularly appropriate in contract disputes. Bicknell Minerals, Inc. v. Tilly, 570 N.E.2d 1307 (Ind.Ct.App.1991), trans. denied. When summary judgment is granted based upon the construction of a contract, the trial court has either determined as a matter of law that the contract is not ambiguous or uncertain, or that the ambiguity can be resolved without the aid of factual determinations. Mid State Bank v. 84 Lumber Co., 629 N.E.2d 909, 914 (Ind.Ct.App.1994).

In the case before us the contract unambiguously provides for commissions based on new and renewal business. Kinser Insurance argued before the trial court, and does so again on appeal, that because the contract made no provision for commissions following her termination Sample was not entitled to them. In addition, relying on the affidavit of James Kinser, Kinser Insurance argues also that the standard in the insurance industry is that commissions are not paid after a person leaves the employ of an insurance agency.

Industry standards may be relevant for some purposes but they are not relevant in this case. Although an employer and employee are free to agree that commissions will not be paid after the employee's termination, the general rule is that a person employed on a commission basis is entitled to those commissions when the order is accepted by the employer. Robinson v. Century Personnel, Inc., 678 N.E.2d 1268, 1270 (Ind.Ct.App.1997), trans. denied. Stated differently a...