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PAIST v. TOWN & COUNTRY CORP.

September 13, 1991

JOHN PAIST, Plaintiff,
v.
TOWN & COUNTRY CORPORATION, a Massachusetts corporation, and FEATURE ENTERPRISES, INC., a New York corporation, Defendants



The opinion of the court was delivered by: NORGLE

 CHARLES RONALD NORGLE, UNITED STATES DISTRICT JUDGE

 Before the court are summary judgment motions of defendant Feature Enterprises, Inc. ("Feature") and plaintiff pursuant to Federal Rule of Civil Procedure 56(c). For the following reasons, the court denies both motions.

 FACTS

 Plaintiff, John Paist, was employed as a sales agent for Feature from 1984 until February, 1990. He sold various types of jewelry in Texas and was paid a commission of 2.0% or 2.5% on all orders from commissioned accounts that Feature received from plaintiff's territory.

 In August 1988, plaintiff, Feature, and Town & Country Corporation ("Town & Country") entered into an employment agreement. *fn1" The agreement stated that plaintiff would be paid commissions "in accordance with rates and practices as in effect on June 30, 1988, through February 28, 1989 . . . ." That same sentence goes on to discuss a term beyond February 1988 of unspecified length by saying, "and thereafter such commissions shall be negotiated in accordance with the policies of the Board of Directors of the Company, provided however that such commission compensation shall be determined in a manner no less favorable to Employee [Paist] than as in effect on June 30, 1988." The agreement also provided that New York law should control all controversies. *fn2"

 Gordon Jewelry Corporation was an account serviced by plaintiff within his sales territory. Plaintiff received commissions on these sales. Subsequently, Feature's parent corporation converted the Gordon account to a non-commissioned house account. *fn3" Plaintiff was not consulted prior to this change in account status and substantial sales continued to be generated by the Gordon account after its conversion to a house account. Plaintiff sued as a result of this conversion, claiming it to be contrary to the agreement. Both parties have now moved for summary judgment.

 DISCUSSION

 Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). A dispute about a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). A plaintiff cannot rest on mere allegations of a claim without any significant probative evidence to support his complaint. Id.; see First Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968). "One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims and defenses . . . ." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Accordingly, the non-moving party is required to go beyond the pleadings, affidavits, depositions, answers to interrogatories and admissions on file to designate specific facts showing a genuine issue for trial. Id. at 324.

 When determining whether a motion for summary judgment should be granted when questions of contract interpretation are involved, the court should give language its plain meaning and effect. Thompson v. Gjivoje, 896 F.2d 716, 721 (2d Cir. 1990); Alpine State Bank v. United States, 941 F.2d 554, 558-59 (7th Cir. 1991) (1991 U.S. App. LEXIS 19697) (court must follow meaning of defined terms). Where the contract language is ambiguous, summary judgment is inappropriate. Bank of Am. Nat'l Trust & Savings Assoc. v. Gillaizeau, 766 F.2d 709 (2d Cir. 1985) (discussing contract releases). Ambiguity resides in a writing when an objective reading reveals more than one possible meaning. Thompson, 896 F.2d at 721. However, a mere assertion of ambiguity by the parties will not prevent summary judgment, evidence of a genuine dispute of material fact is necessary. Garza v. Marine Transp. Lines, Inc., 861 F.2d 23, 27 (2d Cir. 1988). When ambiguity does exist, summary judgment is inappropriate. Smith v. Lehman, 689 F.2d 342, 346 (2d Cir.), cert. denied, 459 U.S. 1173, 74 L. Ed. 2d 1018, 103 S. Ct. 820 (1983). Parol evidence may be used to clarify an otherwise ambiguous term in the contract. Burger King Corp. v. Horn & Hardart Co., 893 F.2d 525, 528 (2d Cir. 1990). All inferences are drawn in favor of the non-movant. Garza, 861 F.2d at 27. After reading the agreement and considering the motions and supporting material, the court finds that the contract is ambiguous.

 In his motion for summary judgment, plaintiff first contends that the agreement signed by Feature was sufficient to meet the Statute of Frauds. He also alleges that Feature had the right to treat the Gordon account as a house account but only if it did not infringe upon the plaintiff's contract rights.

 Feature responds by offering evidence that it is not bound by the agreement in the first place. They reply to plaintiff's second argument by claiming the contract doesn't allow for a commission even if a valid contract was formed since no commissions are paid on a house account.

 Plaintiff responds that the contract and other evidence indicate that the relevant time period for "rates and practices" is June 30, 1988 through February 28, 1989. Thus, his commission (which included the Gordon account before conversion to a house account) could not drop below its levels of that whole period. By refusing to pay him commissions during the second period ...


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