Sindlinger v. Co-sales Co.

• Decision Date: 12 December 2010
• Docket Number: No. 1 CA-CV 10-0022,1 CA-CV 10-0022
• Citation: Sindlinger v. Co-Sales Co., No. 1 CA-CV 10-0022 (Ariz. App. Dec 12, 2010)
• Parties: CHRIS SINDLINGER, a married man, Plaintiff/Appellant, v. CO-SALES COMPANY, an Arizona corporation, Defendant/Appellee.
• Court: Arizona Court of Appeals

CHRIS SINDLINGER, a married man, Plaintiff/Appellant, v. CO-SALES COMPANY, an Arizona corporation, Defendant/Appellee.

No. 1 CA-CV 10-0022

COURT OF APPEALS STATE OF ARIZONA DIVISION ONE DEPARTMENT E

Filed: DEC. 12, 2010

NOTICE: THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES. See Ariz. R. Supreme Court 111(c); ARCAP 28(c) Ariz. R. Crim. P. 31.24

MEMORANDUM DECISION

(Not for Publication-Rule 28, Arizona Rules of Civil Appellate Procedure)

Appeal from the Superior Court in Maricopa County

Cause No. CV2007-091394

The Honorable Joseph C. Kreamer, Judge

AFFIRMED

Law Offices of Kevin Koelbel, P.C.

By Kevin Koelbel

Attorneys for Plaintiff/Appellant

Chandler

Bryan Cave LLP

By James D. Smith

And Meridyth M. Andresen

And Coree E. Neumeyer

Attorneys for Defendant/Appellee

Phoenix

SWANN, Judge ¶1 Chris Sindlinger appeals the trial court's dismissal of his complaint against Co-Sales Company ("Co-Sales"). Because we agree that the statute of limitations expired before Sindlinger filed his complaint, we affirm.

FACTS AND PROCEDURAL HISTORY

¶2 Sindlinger and Co-Sales entered into a one-page agreement ("the agreement") that stated, in pertinent part:

This Employment Contract is entered into as of 1st day of July 2001, between Christopher D. Sindlinger and CO-SALES COMPANY, an Arizona Corporation.

CO-SALES COMPANY agrees to continue your salary and insurance benefits for a five-(5) year period of time, beginning July 1, 2001 through June 30, 2006. Applicable state and federal taxes shall be withheld.

1. Starting wage salary per year will be $84,000 to be paid at $7000.00 per month. (Pay periods are the 15th and last day of each month).

2. Position of Director of Confection/ Specialty Department.

3. Car allowance of $675.00 per month plus a gas card for company use. Cell phone business related charges will be covered.

4. $35,000 Life Insurance policy/ Disability Insurance Policy. Health and dental insurance provided for you as an employee at the cost of $15.00 month. We will reimburse you at the rate of $252.00 per month for dependent coverage.

5. Vacation will be four (4) weeks per year, effective upon hire.

6. Purchase of Sindlinger & Associates current existing accounts at July 1, 2001. CO-SALES COMPANY will agree to pay eight (8) percent, maximum, of annual commissions received for a five-(5) year period of time. July[]1, 2 001 through June 30, 2 006. Payment of these commissions will commence at the sixth year and continue for a period of five (5) years to 2010. These payments will be based on a payout of twenty (20) percent of the accumulated commission to date. Each of the five payments will be paid on a yearly basis. The maximum total payout amount will not exceed $100,000.00[.]

Employee shall devote his full working time and attention to the conduct of business for the Corporation. During this Contract, Employee shall not, without the written consent of the Corporation, directly or indirectly, render services to or for any person or firm for the compensation, or engage in any practice that competes with the interest of the Corporation.

¶3 In April 2002, Co-Sales "demoted" Sindlinger. On September 29, 2003, Co-Sales attempted to modify the agreement by cutting his annual salary in half and restructuring the commission schedule. Sindlinger rejected the amendments, but Co-Sales refused to pay Sindlinger more than half of his salary beginning in October 2003. In April 2005, Co-Sales thrice proposed changes to the agreement; Sindlinger rejected those proposals. When the agreement terminated in 2006, Sindlinger continued to work for Co-Sales as an at-will employee.

¶4 On June 29, 2007, Sindlinger filed a complaint against Co-Sales alleging that Co-Sales purchased Sindlinger & Associates from him on July 1, 2001, and that the July 1 agreement served as consideration for the sale. The complaint made claims for breach of contract ("count 1"), breach of the covenant of good faith and fair dealing ("count 2"), failure to pay wages ("count 3"), fraud ("count 4"), and intentional misrepresentation ("count 5").

¶5 Co-Sales moved to dismiss the complaint pursuant to Ariz. R. Civ. P. ("Rule") 12(b)(6), alleging, inter alia, that the July 1 agreement was an "employment contract" and that each count was barred by certain statutes of limitation. In response, Sindlinger alleged that the agreement was actually a "purchase contract" and that his claims were therefore not subject to the shorter limitations periods.

¶6 After full briefing and oral argument, the trial court issued a two-page minute entry that (1) concluded the agreement was an employment contract, (2) dismissed counts 2, 4 and 5 as barred by their applicable statutes of limitation, ¹ (3) limited counts 1 and 3 to payments due one year before the complaint wasfiled, and (4) allowed breach of contract claims for payments due under paragraph 6 of the agreement.

¶7 Singlinder filed a motion for reconsideration regarding the court's determination that the agreement constituted an employment contract, and the court ordered a response. Before briefing was completed, Sindlinger filed a second motion for reconsideration advancing an alternative argument in the event the court affirmed its decision that the agreement was an employment contract. The court denied Sindlinger's first motion, but never ruled on the second.

¶8 In August 2009, the parties stipulated to a judgment of dismissal with prejudice of Sindlinger's remaining claims. The trial court entered judgment and Sindlinger timely appealed. We have jurisdiction pursuant to A.R.S. § 12-2101(B).

DISCUSSION

¶9 Sindlinger contends that his claims were timely, and challenges the trial court's dismissal of his claims as a matter of law pursuant to Rule 12(b)(6). Our review is de novo. Dube v. Linkins, 216 Ariz. 406, 411, ¶ 5, 167 P.3d 93, 98 (App. 2007).

I. COUNTS 1 AND 2

A. Rule 12(b)(6) Standard

¶10 Sindlinger first asserts the trial court erred by not assuming as true all allegations in the complaint, specificallythat the agreement served as consideration for the sale of Sindlinger & Associates.²

¶11 When considering whether to dismiss a complaint pursuant to Rule 12(b)(6), "well-pleaded material allegations of the complaint are taken as admitted, but conclusions of law or unwarranted deductions of fact are not." Aldabbagh v. Ariz. Dep't of Liquor Licenses & Control, 162 Ariz. 415, 417, 783 P.2d 1207, 1209 (App. 1989). A trial court may consider the facts in the complaint together with the terms of a contract central to the plaintiff's claim. See Long v. City of Glendale, 208 Ariz. 319, 329, ¶ 32, 93 P.3d 519, 529 (App. 2004) ("[I]n appropriate circumstances, the court can accept as true the allegations in the complaint and still determine that the written language is not reasonably susceptible of the meaning asserted. Dismissal of any claims depending solely upon such an interpretation is appropriate because the proponent would not be entitled to relief under any interpretation of the facts susceptible of proof.") (internal quotations omitted). The court is not required to rely on plaintiff's description of the contractterms, but "may look to the agreement itself." Broder v. Cablevision Sys. Corp., 418 F.3d 187, 196 (2d Cir. 2005), cited in Cullen v. Koty-Leavitt Ins. Agency, Inc., 216 Ariz. 509, 513, 168 P.3d 917, 921 (App. 2007).

¶12 As the trial court noted in its March 2008 minute entry, the agreement did not specify that some of Sindlinger's salary was actually consideration for the sale of a business. As the trial court observed, the contract was "specifically called an 'employment contract' by the parties in the body of the contract. [Sindlinger] called the contract an 'employment contract' on the first page of his complaint," and "when taken as a whole, the contract is concentrated on defining the terms of [Sindlinger's] employment." See Hadley v. Sw. Props., Inc., 116 Ariz. 503, 506, 570 P.2d 190, 193 (1977) ("Where the language of the contract is clear and unambiguous, it must be given effect as it is written."); see also C & T Land & Dev. Co. v. Bushnell, 106 Ariz. 21, 22, 470 P.2d 102, 103 (1970) ("[I]nterpretation of an agreement is a question of law for the court.") Indeed, the only indication that the agreement was anything other than an employment contract was the allegation to that effect in Sindlinger's complaint. A party, however, cannot create ambiguity in an agreement simply by alleging a disagreement with its plain meaning. In re Estate ofLamparella, 210 Ariz. 246, 250, 1 21, 109 P.3d 959, 963 (App. 2005).

¶13 As he did in his motion to reconsider below, Sindlinger now contends that selected statements from a July 2007 "settlement" letter written by Co-Sales prove the character of the agreement. Generally, this court does not use evidence attached to a motion for reconsideration as a basis for overturning the trial court's decision to grant a motion to dismiss.³Cella Barr Assocs., Inc. v. Cohen, 177 Ariz. 480, 487 n.1, 868 P.2d 1063, 1070 n.1 (App. 1994); cf. GM Dev. Corp. v. Cmty. Am. Mortg. Corp., 165 Ariz. 1, 4, 795 P.2d 827, 830 (App. 1990) (allowing this court to consider on appeal only those records before the trial court at the time it considered a motion for summary judgment). When we do, it is because facts or arguments presented were not available at the time judgment was entered. Evans Withycombe, Inc. v. W. Innovations, Inc., 215 Ariz. 237, 241 n.5, 1 16, 159 P.3d 547, 551 n.5 (App. 2006). Here, the settlement letter was available before Sindlinger filed his response to the motion to dismiss. Had he wished totransform the motion to dismiss into one for summary judgment by introducing the letter, he had ample opportunity to do so before the court decided the motion.

¶14 Even if we were to consider the letter on appeal, we would not conclude that its contents undermine the trial court's view of the fundamental nature of the agreement.⁴ For example,...