Case Title: Calcote v. Fraser Forbes Co.

Citation: 

Docket Number: 050312

State: virginia

Court: Virginia Supreme Court

Date: 2005-11-04T00:00:00Z

Document:
Present:  All the Justices 
 
CHARLES L. CALCOTE 
 
v.  Record No. 050312     OPINION BY JUSTICE ELIZABETH B. LACY 
 
 
 
November 4, 2005 
FRASER FORBES COMPANY, LLC 
 
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY 
Leslie M. Alden, Judge 
 
 
In this appeal, we consider whether the trial court 
correctly applied the terms of an arbitration award in 
determining amounts due under the award. 
FACTS AND PROCEEDINGS 
 
Charles L. Calcote worked under a Broker-Independent 
Contractor Agreement (the Contract) for Fraser Forbes Company, 
LLC (Fraser Forbes), a broker of deals for raw land.  When 
Calcote terminated the Contract, Fraser Forbes refused to pay 
Calcote commissions on any transactions that had not closed 
prior to termination, asserting that the Contract did not 
provide for such payments.  The parties submitted this dispute 
to arbitration in the District of Columbia as provided in the 
Contract. 
After considering evidence and arguments of the parties, 
the Arbitrator filed his award on July 24, 2003 (the Award) 
holding that, in entering the Contract, Calcote and Fraser 
Forbes adopted the industry practice of "pay when paid" and 
that the "Contract requires the payment of commissions, less 
 
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management fees, on all transactions having fully executed 
contracts for sale prior to the termination of the Contract, 
which commissions must be paid at the end of the month in 
which Fraser Forbes receives its commission for those 
transactions."  The Award specifically recited in Paragraph 
15(a) that Fraser Forbes owed Calcote $102,524.73 in 
commissions on closed transactions for which Calcote had 
produced fully executed contracts prior to termination.  For 
eight other transactions for which Calcote had produced fully 
executed contracts but had not yet closed prior to 
termination, Paragraph 15(b) of the Award set out a method of 
calculating the commissions due Calcote when the transactions 
did close and Fraser Forbes received the commission.  
Paragraph 15, subsections (d) and (e) of the Award, gave 
Calcote attorneys' fees and assigned the costs of the 
arbitration to Fraser Forbes, respectively. 
Neither Fraser Forbes nor Calcote sought clarification or 
modification of the Award from the Arbitrator, but Fraser 
Forbes filed a motion in the Superior Court of the District of 
Columbia to vacate the Award.  The court denied the motion and 
confirmed the Award in an order entered January 30, 2004. 
In February 2004, Calcote filed an authenticated copy of 
the District of Columbia judgment along with a copy of the 
Award in the Circuit Court of Fairfax County pursuant to 
 
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Virginia's Uniform Enforcement of Foreign Judgments Act, Code 
§§ 8.01-465.1 through -465.5.  Fraser Forbes, which had 
appealed the District of Columbia Superior Court's order, 
filed an emergency motion to suspend the domesticated judgment 
during the pendency of the appeal.1  The trial court granted 
this motion and suspended the domesticated judgment pending 
termination of the appeal process. 
In July 2004, Fraser Forbes paid Calcote the amounts owed 
under Paragraph 15, subsections (a), (d), and (e) of the 
Award.  Fraser Forbes and Calcote then executed an agreed 
dismissal with prejudice and, based on this agreement, the 
District of Columbia Court of Appeals dismissed Fraser Forbes' 
appeal on August 5, 2004. 
Calcote thereafter filed a partial judgment release and a 
motion to release the previously entered suspending order so 
that he could collect amounts allegedly due for two of the 
eight transactions identified in Paragraph 15(b) of the Award, 
the Corro and Reston transactions.  These transactions had 
closed subsequent to the entry of the Award.  Fraser Forbes 
objected to the release of the suspending order and filed a 
motion to have the judgment marked "as fully satisfied through 
                     
1 Calcote instituted a parallel proceeding in the Circuit 
Court for Loudoun County, which that court also suspended.  
Because the Fairfax Court scheduled its hearing date first, 
 
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the present."  Fraser Forbes argued that it had paid Calcote 
the commissions due on the Corro and Reston transactions. 
Calcote responded that the amounts he received from 
Fraser Forbes for the Corro and Reston transactions, 
$54,054.29 and $3,210.19, respectively, only partially 
satisfied the judgment as to these transactions because, under 
the terms of the Award, he was entitled to commissions of 
$141,922 for the Corro transaction and $4,774 for the Reston 
transaction. 
Following a hearing on the respective motions, the trial 
court entered an order vacating the suspending order and 
marking the judgment satisfied with respect to the amounts 
paid pursuant to Paragraph 15, subsections (a), (d), and (e) 
and the Corro and Reston transactions.  The trial court's 
order also provided that the commissions due Calcote on any 
remaining Paragraph 15(b) transactions "shall be computed in a 
manner consistent with the Broker-Independent Contractor 
Agreement between the parties dated August 21, 1997, including 
Exhibits A and B thereto, and the manner in which the recently 
paid and satisfied amounts [for the Corro and Reston 
transactions] were computed." 
                                                                
Fraser Forbes agreed to allow the Fairfax Court to decide 
subsequent motions. 
 
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Calcote filed a motion for reconsideration, arguing that 
the calculations the trial court used to mark the judgment 
satisfied and to determine commissions on future transactions 
were not consistent with the provisions of the Award and that 
the Full Faith and Credit Clause, U.S. Const. art. IV, § 1, 
precluded the trial court from consulting extrinsic evidence 
to interpret the unambiguous Award.  The trial court denied 
Calcote's motion and Calcote filed a timely appeal with this 
Court. 
DISCUSSION 
The power to modify an arbitration award is very limited.  
See, e.g., Va. Code §§ 8.01-581.010 and -581.011; D.C. Code 
§ 16-4311.  The Award in this case has been confirmed and has 
been embodied in a final judgment of another jurisdiction.  
The parties agree that the trial court, in determining whether 
any part of the Award had been satisfied, was required to 
apply the terms of the arbitration award and the court did not 
have the authority to consider the issues resolved by the 
Award or otherwise change the Award.  The parties also agree 
that the District of Columbia judgment confirming the Award is 
entitled to full faith and credit by the courts of this 
Commonwealth.  They agree on the amounts of gross commissions 
that Fraser Forbes received for the two completed transactions 
at issue, and they agree that Fraser Forbes is entitled to a 
 
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10% management fee on these transactions.  The sole point of 
disagreement between the parties is whether the trial court 
properly applied the terms of the Award, specifically the 
provisions of Paragraph 15(b). 
Paragraph 15(b) of the Award provides: 
RESPONDENT, Fraser Forbes, LLC shall pay CLAIMANT, 
Charles Lee Calcote, the indicated portion of the 
gross commission to Fraser Forbes LLC for each of 
the following transactions, at the end of the month 
in which the commission for the transaction is 
received by Fraser Forbes, less the management fee, 
provided Fraser Forbes receives the commission: 
 
i.  Sale of the Brandt Property to Richmond 
America Homes or assigns pursuant to contract dated 
July 31, 2002 (50%);* 
ii.  Sale of Alphin Property to Joe Bane, Jr. 
pursuant to contract of January 14, 2002 (50%);* 
iii.  Sale of the Corro Property to Carr Homes 
pursuant to a contract dated December 14, 2001 
(50%);* 
iv.  Sale of Gilbert's Corner to Holtzman Oil 
in sales contract dated March 22, 2002 (50%);* 
v.  Sale of Mahoney (Brundred) property to 
Richmond America Homes pursuant to a contract dated 
April 30, 2002 (65%);* 
vi.  Sale of Moore Property to Classic Concepts 
pursuant to contract dated June 27, 2002 (50%);* 
vii.  Sale of 1246 Reston Avenue to Keystone, 
L.L.C. (25%);* and 
viii.  Sale of Royal Oaks pursuant to contract 
dated March 23, 2000 (100%).* 
 
*The percentage of the gross commission to 
Fraser Forbes that is to be paid to Charles Calcote 
may be adjusted upward in accordance with Exhibit A 
to the Contract if the aggregate Agent Commission 
Dollars exceed THIRTY SEVEN THOUSAND FIVE HUNDRED 
DOLLARS AND NO CENTS ($37,500.00) in any given year. 
 
Calcote argues that the calculation methodology set out 
in Paragraph 15(b) of the Award requires that he be paid the 
 
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enumerated percentage of the gross commissions Fraser Forbes 
receives for each specific transaction, less a 10% management 
fee.  The Award then allows that amount to be "adjusted 
upward" by applying Exhibit A to the Contract if Calcote's 
aggregate commissions exceed $37,500 in any given year.2 
According to Calcote, the trial court did not apply the 
methodology set out in Paragraph 15(b) when it determined that 
Fraser Forbes had satisfied its debt to Calcote on the Corro 
and Reston transactions nor when it instructed the parties on 
calculating future transactions.  Instead, as stated in the 
final order, the trial court based its calculations on an 
application of the provisions of the Contract and its Exhibits 
A and B.  These rulings, Calcote asserts, were erroneous. 
Fraser Forbes responds by presenting various arguments in 
support of the trial court's order.  First, Fraser Forbes 
argues that "[t]he four corners of the Award support the Trial 
Court's findings that commissions . . . are to be paid in 
accordance with the [Contract], including . . . Exhibits A and 
B."  Fraser Forbes explains that the Contract provided a two-
step approach in determining the amount of commission to which 
an agent was entitled in each transaction.  The first step was 
to apply a percentage to the gross commission Fraser Forbes 
received for the transaction based on the level of the agent's 
                     
2 Exhibit A is attached as an addendum to this opinion. 
 
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involvement in the transaction.  These percentages were 
contained in Exhibit B to the Contract.  The resulting figure 
became the "agent split."  The second step was to subject the 
"agent split" to a second percentage calculation, contained in 
Exhibit A to the Contract, based on the overall commissions 
the agent earned during a calendar year.  The resulting figure 
represented the amount of commission an agent received for the 
transaction. 
Fraser Forbes argues that the calculations described in 
Paragraph 15(b) of the Award follow this same two-step 
procedure.  Asserting that the percentages contained in 
Paragraph 15(b) are "in lieu of Exhibit B" to the Contract, 
Fraser Forbes identifies the first step as multiplying the 
gross commissions it received by the percentage listed 
following each of the contingent transactions.  The next step, 
according to Fraser Forbes, requires applying the percentages 
in Exhibit A to the figure obtained in the first step as 
directed by the asterisked sentence in the Award.  The 
resulting figure is the amount of commission to which Calcote 
is entitled.  Fraser Forbes contends that the Arbitrator used 
this methodology to arrive at the amount of commissions due 
Calcote on transactions that had closed prior to his 
termination as set out in Paragraph 15(a). 
 
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While Fraser Forbes' explanation may reflect the proper 
interpretation of the Contract between the parties, the 
parties' past practices, and even the intent of the 
Arbitrator, it does not reflect the terms prescribed in the 
Award.  The Award does not indicate that the percentage 
following each transaction in Paragraph 15(b) is "in lieu of" 
Exhibit B to the Contract; nor does the Award direct that 
Exhibit A be applied to the figure obtained by multiplying the 
gross commissions by the percentages in Paragraph 15(b).  
Furthermore, although Exhibit A contains a series of 
percentage commission splits between an agent and Fraser 
Forbes, it does not direct the application of those 
percentages to any specific amount or prior computation.  That 
direction is contained only in the Contract itself, and 
nothing in the Award incorporates provisions of the Contract 
in the methodology for calculating the amount of commissions 
due. 
Contrary to Fraser Forbes' assertion, the Award contains 
no indication of the methodology the Arbitrator used to arrive 
at the commission due Calcote set out in Paragraph 15(a).  The 
Award only orders payment of a specific amount, $102,524.73.  
Nothing on the face of the Award indicates that the Contract 
provisions were the basis for the calculation methodology set 
 
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out in Paragraph 15(b), and we reject Fraser Forbes’ argument 
in this regard. 
 
Fraser Forbes also argues that applying the Award in the 
manner Calcote suggests is "strained and nonsensical."  To 
illustrate its point, Fraser Forbes references the commission 
award in Paragraph 15(b)(viii) for the Royal Oaks transaction.  
According to Fraser Forbes, because the Award provided that 
Calcote would be entitled to 100% of the gross commissions 
Fraser Forbes received on that transaction, it would be 
impossible to adjust the Commission award upward as set out in 
the asterisked sentence under Calcote’s interpretation of 
Paragraph 15(b). 
We disagree with Fraser Forbes' interpretation of the 
asterisked sentence.  That sentence states that an award "may 
be adjusted upward."  (Emphasis added).  The permissive nature 
of this provision shows that its application in every case was 
not contemplated.  Because the provision may not apply in a 
specific instance does not make application of the provision 
as set out in the Award "strained and nonsensical." 
Finally, Fraser Forbes asserts that Calcote is judicially 
estopped from asserting that the Award should be enforced in a 
manner other than one consistent with methodology set out in 
the Contract because Calcote provided the Arbitrator with 
testimony and written documentation that his commissions on 
 
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transactions that closed in the future should be determined 
according to the Contract.  We reject this argument. 
Judicial estoppel forbids parties from assuming 
inconsistent positions in the course of a suit or series of 
suits with reference to the same set of facts.  Lofton Ridge, 
LLC v. Norfolk S. Ry. Co., 268 Va. 377, 380-81, 601 S.E.2d 
648, 650 (2004).  The positions taken and documents submitted 
by Calcote calculating commissions on future transactions 
based on the Contract were submissions made to the Arbitrator 
relative to the issues in arbitration.  Those issues were 
resolved by the Award and are not before us now.  The issue in 
this case is the proper application of the Award, an issue not 
present in the arbitration.  Judicial estoppel is not invoked 
under these circumstances.3 
CONCLUSION 
 
In its final order, the trial court directed that future 
commissions owed Calcote be calculated based on the Contract 
between the parties, including Exhibits A and B to that 
Contract.  The order also indicated that the trial court 
referenced the same documents to conclude that Fraser Forbes 
                     
3 We also reject Fraser Forbes assertion that Calcote 
failed to preserve certain arguments and assignments of error.  
Calcote's objections to the order and his motion for 
reconsideration sufficiently established the arguments made 
and afforded the trial court the opportunity to consider those 
assignments of error. 
 
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satisfied its debts on the Corro and Reston transactions.  As 
explained above, nothing in the Award suggests the Contract 
between the parties should be used to calculate the 
commissions due under Paragraph 15(b).  Rather, the terms of 
the Award as written can and must be applied to determine the 
amount of commissions due Calcote. 
 
Accordingly, the trial court erred because it did not 
enforce the judgment in a manner consistent with the 
provisions of the Award.  The judgment of the trial court will 
be reversed and the case remanded for further proceedings 
consistent with this opinion. 
Reversed and remanded. 
 
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EXHIBIT "A" 
FRASER-FORBES REAL ESTATE 
COMMISSION SCHEDULE 
ALL AGENTS 
AGENT COMMISSION 
DOLLARS 
AGENT COMMISSION 
PERCENTAGE 
FRASER-FORBES 
COMMISSION % 
 
0 TO $37,500 
 
50% 
 
50% 
 
$37,501 TO $125,000 
 
55% 
 
45% 
 
$125,001 TO $162,500 
 
60% 
 
40% 
 
$162,501 TO $200,000 
 
65% 
 
35% 
 
Over $200,000 
 
70% 
 
30% 
 
 
 
 
 
The above Commission Schedule is effective from January 1, through December 31, of any given 
calendar year.  After the year's end and at the beginning of the following year, the commission 
schedule starts anew with the first percentage split and continues upwards throughout the year. 
 
Commissions are paid to Agent by Broker on the last business day of each month providing the 
commission check has been deposited and five (5) business days have elapsed.  Commissions 
received after that time will be disbursed on the last business day of the following month. 
 
If Agent terminates, for whatever legal reason, Broker will disburse to Agent all commissions due 
less ten percent (10%) of the gross commission(s) as a management/service fee. 
 
The two principals of the firm, John Protopappas and Richard Samit are both independent Agents 
as well as "The House".  Their role will be defined on a case by case basis.  At times, one or both 
will be active Agents.  At times, one or both will help facilitate deals as "The House".  The House 
is defined as the commission amount that Fraser-Forbes Real Estate receives for its' company 
share.