Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-15-01878/USCOURTS-ca8-15-01878-0/pdf.json

Parties Involved:
GC Services Limited Partnership
Appellee
Gateway Customer Solutions
Appellant

Document Text:

United States Court of Appeals

For the Eighth Circuit

___________________________

No. 15-1878

___________________________

Gateway Customer Solutions, LLC

lllllllllllllllllllll Plaintiff - Appellant

v.

GC Services Limited Partnership

lllllllllllllllllllll Defendant - Appellee

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Appeal from United States District Court 

for the District of Nebraska - Omaha

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 Submitted: December 16, 2015

 Filed: June 10, 2016

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Before WOLLMAN, LOKEN, and BYE, Circuit Judges.1

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LOKEN, Circuit Judge.

In April 2011, Gateway Customer Solutions, LLC (“Gateway”), entered into

a Business Referral Agreement with GC Services Limited Partnership (“GC

Services”) in which Gateway agreed to solicit and refer potential clients to GC

This opinion is being filed by Judge Wollman and Judge Loken pursuant to 1

8th Cir. Rule 47E.

Appellate Case: 15-1878 Page: 1 Date Filed: 06/10/2016 Entry ID: 4410500 
Services. Gateway soon introduced GC Services to Mercedes-Benz Financial

Services (“MBFS”). In August 2011, MBFS awarded GC Services a three-year

contract to provide call center services to MBFS (the “2011 Agreement”). The

Gateway - GC Services agreement provided for commission paymentsto Gateway for

“[t]he duration of an awarded contract and any renewals pursuant thereto.” 

In 2014, GC Services and MBFS entered into a new agreement reciting that it

“supersedes and replaces” their 2011 Agreement. Gateway commenced this diversity

action, alleging that it is entitled to continuing commissions because the new

agreement (the “2014 Agreement”) was a “renewal” of the 2011 Agreement. Acting

on the parties’ cross motions for summary judgment, the district court granted

2

summary judgment to GC Services, holding that the 2014 Agreement between GC

Services and MBFS was a new agreement that ended GC Services’s obligation to pay

commissions to Gateway. Reviewing the grant ofsummary judgment and the district

court’s interpretation of state law de novo, we affirm. See Matrix Grp. v. Rawlings

Sporting Goods Co., 477 F.3d 583, 589 (8th Cir. 2007) (standard of review). 

The Business Referral Agreement provided that Gateway would submit a

proposed contract Addendum if it found GC Services a potential client. If GC

Services executed the Addendum and then entered into a contract with the potential

client, Gateway would receive commissions fromGC Services “for the period of time

[and] the services . . . explicitly specified on an executed Addendum.” Gateway

would continue to receive commissions in accordance with the Addendum even after

the parties terminated the Business Referral Agreement.

The Honorable Thomas D. Thalken, United States Magistrate Judge for the

2

District of Nebraska, presiding by consent of the parties pursuant to 28 U.S.C.

§ 636(c).

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Appellate Case: 15-1878 Page: 2 Date Filed: 06/10/2016 Entry ID: 4410500 
In May 2011, Gateway and GC Services executed AddendumA, listing MBFS

as a potential GC Services client. Consistent with the form of Addendum attached

to the Business Referral Agreement, Addendum A provided that GC Services would

pay Gateway a brokerage fee totaling 5% of all fees GC Services received from

MBFS for “[t]he duration of an awarded contract and any renewals pursuant thereto.”

The 2011 Agreement between GC Services and MBFS provided:

This Agreement is for a period of three (3) years (“Initial Term”) and

shall continue upon the same terms and conditions asset forth herein for

additional successive one-year periods (“Renewal Terms”) until

termination of same is requested by written notice from either party to

the other at least ninety (90) days in advance of the termination of any

Initial or Renewal Time period, as applicable.

GC Services and MBFS executed the 2014 Agreement effective August 1,

2014. The 2014 Agreement provided that it (i) “supersedes and replaces the [2011

Agreement],” and (ii) “is for a period of three (3) years (‘Initial Term’) beginning on

the Effective Date, and may be extended as mutually agreed by the parties.” 

Otherwise, the 2011 and 2014 Agreements contained substantially similar terms; the

2014 Agreement even retained a misspelling in the 2011 Agreement. 

In September 2014, GC Services notified Gateway that the 2011 Agreement

had expired; therefore, GC Services would no longer pay commissions. Gateway

responded that it was under the impression the 2011 Agreement had been renewed. 

GC Services replied, “we have negotiated a new agreement at the expiration of the

original agreement and our services will no longer be performed pursuant to that

contract . . . or any renewal options.” This declaratory judgment action followed. The

district court granted summary judgment for GC Services, concluding that Addendum

A unambiguously provided that the 2014 Agreement was not a “renewal” of the 2011

Agreement.

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Appellate Case: 15-1878 Page: 3 Date Filed: 06/10/2016 Entry ID: 4410500 
The parties agree that, pursuant to a choice-of-law provision in the Business

Referral Agreement, Delaware law governs our interpretation of their contract. 

Delaware follows “traditional principles of contract interpretation,” including giving

“effect to the plain meaning of a contract’s terms and provisions when the contract

is clear and unambiguous.” ConAgra Foods, Inc. v. Lexington Ins. Co., 21 A.3d 62,

68-69 (Del. 2011). A contract term is not ambiguous “simply because the parties do

not agree upon its proper construction. Rather, a contract is ambiguous only when

the provisions in controversy are . . . fairly susceptible of different interpretations or

may have two or more different meanings.” Rhone-Poulenc BasicChems. Co. v. Am.

MotoristsIns. Co., 616 A.2d 1192, 1196 (Del. 1992). The contract must be construed

as a whole, not by looking at terms in isolation. O’Brien v. Progressive N. Ins. Co.,

785 A.2d 281, 287 (Del. 2001). “The true test is what a reasonable person in the

position of the parties would have thought [the contract language] meant.” Eagle

Indus., Inc. v. DeVilbiss Health Care, Inc., 702 A.2d 1228, 1232 n.8 (Del. 1997).

This case hinges on the meaning of the reference to “renewals” in Addendum

A. Gateway contends that, even if the 2014 Agreement was a new contract between

GC Services and MBFS, in substance it merely replaced the 2011 Agreement and

therefore falls within the meaning of contract “renewal” as defined in Black’s Law

Dictionary 1410 (9th ed. 2009): “The re-creation of a legal relationship or the

replacement of an old contract with a new contract, as opposed to the mere extension

of a previous relationship or contract.” The Supreme Court of Delaware has looked

to Black’s Law Dictionary in construing contract terms. See, e.g., Pac. Ins. Co. v.

Liberty Mut. Ins. Co., 956 A.2d 1246, 1255 & n.35 (Del. 2008). However, 

“Delaware courtslook to dictionaries for assistance in determining the plain meaning

of terms that are not contractually defined.” Seaford Golf & Country Club v. E.I.

Dupont de Nemours & Co., 925 A.2d 1255., 1261 (Del. 2007) (emphasis added),

citing Lorillard Tobacco Co. v. Am. Legacy Found., 903 A.2d 728, 738 (Del. 2006). 

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Appellate Case: 15-1878 Page: 4 Date Filed: 06/10/2016 Entry ID: 4410500 
Here, the term “renewals” was defined in Addendum A. The Terms of Fee

Payment provision stated that commissions will be paid to Gateway for “[t]he

duration of an awarded contract and any renewals pursuant thereto.” (Emphasis

added.) Thus, Addendum A -- drafted by Gateway -- provided that the period in

which Gateway would be entitled to receive commissions would be defined in the

future “awarded contract,” a contract to which Gateway would not be a party. 

Perhaps not a wise provision, from Gateway’s perspective, but it is not ambiguous. 

GC Services points out that if Gateway intended to be the beneficiary of any

continuing businessrelationship between GC Services and Mercedes-Benz, Gateway

had the option to draft Addendum A with plain language reflecting that intent.

In the 2011 Agreement (the “awarded contract”), GC Services and MBFS

defined “Renewal Terms” as meaning “additional successive one-year periods . . .

until termination . . . isrequested by written notice from either party . . . at least ninety

(90) days in advance of the termination.” Although the 2014 Agreement between GC

Services and MBFS had many terms substantially similar to the 2011 Agreement, the

new agreement was not a “Renewal Term” of the 2011 Agreement. It was separately

negotiated by the parties, was not for a one-year period, and explicitly stated that it

“supersedes and replaces” the 2011 Agreement. 

Gateway contendsthat the 2014 Agreement was a renewal due to its substantial

similarity to the 2011 Agreement, citing cases from other jurisdictions in which the

word “renewal” was more broadly defined or left undefined in the contract at issue. 

But when a contract specifically defines a word that has various possible meanings,

the Supreme Court of Delaware looks to the plain meaning of that definition. 

Moreover, “[a] mere split in the case law concerning the meaning of a term does not

render that meaning ambiguous in the Delaware courts.” O’Brien, 785 A.2d at 289.

Because we agree with the district court that the relevant contract provisions

are not ambiguous, we may not consider extrinsic evidence, nor does the doctrine of

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Appellate Case: 15-1878 Page: 5 Date Filed: 06/10/2016 Entry ID: 4410500 
contra proferentum apply (construing a contract in favor of the non-drafter). See

Rhone-Poulenc, 616 A.2d at 1196, 1198.

The judgment of the district court is affirmed.

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Appellate Case: 15-1878 Page: 6 Date Filed: 06/10/2016 Entry ID: 4410500