1

The court recounts the disputed evidence in a light favorable

to Craft as the summary judgment nonmovant and draws all reasonable

inferences in his favor. E.g., U.S. Bank Nat’l Ass’n v. Safeguard

Ins. Co., 422 F.Supp.2d 698, 701 n.2 (N.D. Tex. 2006) (Fitzwater,

J.) (citing Clift v. Clift, 210 F.3d 268, 270 (5th Cir. 2000)). 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

ROBERT DAVID CRAFT, §

 §

Plaintiff-counterdefendant,§

 § Civil Action No. 3:05-CV-2421-D

VS. §

 §

JOHN H. HARLAND COMPANY, §

 §

Defendant-counterplaintiff.§

MEMORANDUM OPINION

 AND ORDER 

In this removed action alleging breach of contract and related

claims arising from the nonpayment of sales commissions, defendantcounterplaintiff moves for partial summary judgment dismissing

plaintiff’s claims. The court concludes that plaintiff cannot

establish that defendant breached the contract in question and that

he cannot recover on the related claims. It therefore grants the

motion and dismisses plaintiff’s claims.

I

Defendant-counterplaintiff John H. Harland Company (“Harland”)

provides payment, platform automation, core processing, analytical,

and direct marketing services solutions to financial institutions

throughout the United States.1

 Plaintiff-counterdefendant Robert

David Craft (“Craft”) worked as a salesman for Harland and, by
- 2 -

2004, was part of the team responsible for encouraging existing

Harland clients to increase their use of Harland’s direct marketing

products and services. In this position, Craft earned a base

salary of $88,068.00 in the year 2004. He was also entitled to a

commission based on direct marketing sales revenue.

The commission portion of Craft’s 2004 compensation was

governed by two documents (collectively, the “2004 Contract”):

Harland’s “Company Incentive Compensation Plan” (“ICP”) and the

“FY2004 Quota Commitment Worksheet” (“Quota Worksheet”)

specifically created for Craft. The ICP provides, in relevant

part, that “[e]ach Participant’s FY2004 Quota Commitment Worksheet

specifies the opportunities available to the Participant, as well

as specific quotas and commission rates.” D. App. 7 (italics in

original). It further states that “[t]he Plan Year is January 1,

2004 to December 31, 2004.” Id. at 9. The Quota Worksheet

outlines the various commission rates for Craft’s direct marketing

commissions. It specifies that “Direct Marketing Commissions are

paid quarterly on actual net revenue.” D. App. 12. 

On or around December 17, 2004, in his position as a Key

Account Executive, Craft completed negotiations and executed a

direct marketing contract between Harland and National City Bank

(“National City”). Craft alleges that the terms of the contract

required National City to pay at least $5 million per year for two

years, and has language establishing penalties if it does not.
- 3 -

Harland maintains that this contract did not require National City

to purchase any direct marketing products or services; instead, it

established agreements with respect to pricing and discounts for

any purchases that National City elected to make.

During 2004, the total direct marketing net revenue from

clients assigned to Craft was $1,963,319.21. Included in this

amount is the direct marketing actual net revenue that Harland

received from National City during 2004, which equaled

$1,368,232.92. Through the end of the third quarter of 2004, Craft

had earned a direct marketing commission of over $29,304.58; his

total direct marketing commission for 2004 equaled $48,131.62.

After the expiration of the FY 2004 Contract, Harland pressed

Craft to sign a new, FY 2005 contract (“Proposed 2005 Contract”)

that would reduce his commission rate from 3% to .01%. Craft

refused to sign the Proposed 2005 Contract without Harland‘s

agreement that his existing commissions from 2004 and earlier

(including the commissions from revenue received from National

City), would not be affected. Harland refused to enter into this

agreement, and Craft declined to sign the Proposed 2005 Contract.

At the end of the first quarter of 2005, Craft was not paid any

commission on the actual net value of the National City contract,

or any other. In April 2005 Craft quit Harland and later brought

this suit to recover unpaid commissions. He asserts claims for

breach of contract, conversion, quantum meruit, violation of
2

Harland does not move for summary judgment on its

counterclaim. Unless Harland seeks to dismiss the causes of action

pleaded in the counterclaim, they remain on the docket to be tried.

3

In support of its reply brief, Harland filed an evidence

appendix. Because it did not first obtain leave of court, the

court has not considered the reply appendix in deciding this

motion. See Dethrow v. Parkland Health Hosp. Sys., 204 F.R.D. 102,

104 (N.D. Tex. 2001) (Fitzwater, J.) (holding that party may not

file summary judgment reply appendix without first obtaining leave

of court).

- 4 -

chapter 61 of the Texas Labor Code, fraudulent misrepresentation,

and fraudulent inducement.

Harland moves for partial summary judgment dismissing Craft’s

claims,2

 arguing that he cannot demonstrate that Harland failed to

pay Craft commissions required by the 2004 Contract. It argues

that because Craft’s claims for conversion, violation of the Texas

Labor Code, fraudulent misrepresentation and fraudulent inducement

are based on Craft’s allegation that he is owed additional

commissions under the contract, these claims should also be

dismissed because Harland paid all commissions required by the

contract. It further argues that Craft’s claim for quantum meruit

should be dismissed because the services at issue are covered by an

express contract.3 Craft opposes the motion.

II

 Because Harland will not have the burden of proof at trial on

Craft’s claims, it can meet its summary judgment obligation by

pointing the court to the absence of evidence to support them. See

Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). Once Harland
- 5 -

does so, Craft must then go beyond his pleadings and designate

specific facts showing there is a genuine issue for trial. See id.

at 324; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir.

1994) (en banc) (per curiam). An issue is genuine “if the evidence

is such that a reasonable jury could return a verdict for the

nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

248 (1986). Craft’s failure to produce proof as to any essential

element renders all other facts immaterial. Edgar v. Gen. Elec.

Co., 2002 WL 318331, at *4 (N.D. Tex. Feb. 27, 2002) (Fitzwater,

J.) (citing Celotex Corp., 477 U.S. at 323). Summary judgment is

mandatory if Craft fails to meet his burden. Little, 37 F.3d at

1076. 

III

Harland contends that it is entitled to summary judgment

dismissing Craft’s breach of contract claim.

A

Harland argues that Craft cannot demonstrate that it breached

the 2004 Contract, because Harland paid Craft all the commissions

he was due under that contract. Craft’s Quota Worksheet provides:

“Direct Marketing Commissions are paid quarterly on actual net

revenue.” D. App. 12. The ICP states under the heading “Effective

Date”:
- 6 -

1. The Plan Year is January 1, 2004 to

December 31, 2004. 

2. The Plan supersedes all prior incentive

compensation plans or arrangements. 

3. The Administrators may extend the Plan

beyond the Plan Year.

Id. at 9. Harland maintains that under the clear terms of the 2004

Contract, Craft’s commissions are computed based on “actual net

revenue”; nowhere does the 2004 Contract provide for direct

marketing commissions based on estimated future revenue. It posits

that the commission rates were based on annual quotas, and the 2004

Contract was only for a term of one year. Subject to the

Administrators’ right to extend the Plan beyond one year (which

Craft does not argue occurred), the 2004 Contract was effective

only until December 31, 2004. Harland asserts that it paid Craft

for all actual net revenue received in 2004 from clients assigned

to Craft. During 2004, the total direct marketing revenue assigned

to Craft was $1,963,319.21 and, from this figure, Craft was

entitled to a commission of $48,131.62. Harland paid Craft this

amount and argues that there was no 2004 direct marketing net

revenue from National City or from any other source for which Craft

was not paid a direct marketing commission. Harland argues that

because Craft cannot identify any direct marketing revenue from the

year 2004 that Harland received from a client assigned to Craft,

and for which Craft was not paid a commission, Craft cannot

establish that Harland breached its contract with Craft.
- 7 -

Craft responds that he is not seeking payment of the full,

ultimate value of the National City contract as of its signing in

December 2004. Rather, he is contending that, absent any new

agreement, Harland must pay him a commission on direct marketing

net revenue from National City in each subsequent quarter in which

Harland realizes actual net revenue from the 2004 Contract with

National City. Craft concedes that the commission terms of the

2004 Contract expired on December 31, 2004, but he argues that

Harland is still obligated to pay commissions on accounts that

generate actual net revenue until those contracts come to term. In

support of this allegation, Craft points to his Quota Worksheet,

which merely states that “Direct Marketing Commissions are paid

quarterly on actual net revenue.” D. App. 12. He argues that if

there is any ambiguity in the contract terms, they are to be

construed against Harland. 

Craft next contends that under Texas law, a party commits a

material breach of a contract when the injured party is deprived of

the benefit it reasonably expected. He maintains that he expected

Harland would pay him for the 2004 National City contract under the

terms in effect when it was negotiated (i.e., the terms in the 2004

Contract). But instead of paying him the commission he expected,

Harland attempted to force him to accept a new contract to

supersede the 2004 Contract. Craft argues that the Proposed 2005

Contract would drastically cut his compensation; that he has not
- 8 -

been paid a commission under either the 2004 Contract or the

Proposed 2005 Contract; that by refusing Harland’s new terms for

2005, he has apparently been required to work for free; and that

he is at least entitled to be paid the actual amount of net revenue

that Harland received from January 1, 2005 until he quit in April

of 2005. Craft argues that the question “how much should Harland

pay Craft for the 2004 National City contract” is a fact question

for the jury.

Harland replies that Craft is seeking, under the terms of the

2004 Contract, to require that Harland pay him commissions for

direct marketing revenue that Harland received in 2005, even though

the 2004 Contract expired on December 31, 2004. It argues that the

“paid quarterly on actual net revenue” language of the 2004

Contract means that commissions for 2004 direct revenue will be

paid once per quarter until the contract terminates at the close of

2004. Harland maintains that there is no factual dispute for the

jury; the 2004 Contract is not ambiguous, and therefore its meaning

is determined by the court as a matter of law. 

B

Under Texas law, the elements of a breach of contract claim

are (1) the existence of a valid contract between plaintiff and

defendant, (2) the plaintiff’s performance or tender of

performance, (3) the defendant’s breach of the contract, and (4)

the plaintiff’s damage as a result of the breach. Prime Prods.,
- 9 -

Inc. v. S.S.I. Plastics, Inc., 97 S.W.3d 631, 636 (Tex. App. 2002,

pet. denied). The parties do not dispute the existence of a valid

contract or whether Craft performed under the agreement. Instead,

they argue over whether Harland breached the 2004 Contract by

refusing to pay Craft a commission on revenue received from City

National after December 31, 2004.

“The meaning given to the language in a contract is . . . a

question of law for the court.” Bank One, Tex., N.A. v. Stewart,

967 S.W.2d 419, 432 (Tex. App. 1998, pet. denied) (citing Snyder v.

Eanes Indep. Sch. Dist., 860 S.W.2d 692, 696 (Tex. App. 1993, writ

denied)). “Likewise, whether a party has breached a contract is a

question of law for the court and not a question of fact for the

jury.” Id. (citing Meek v. Bishop Peterson & Sharp, P.C., 919

S.W.2d 805, 808 (Tex. App. 1996, writ denied)). In deciding

whether the contract has been breached, the court must enforce the

language in the contract as it is written by “looking at the

objective intent as manifested by the language used, rather than

interpreting it by attempting to divine the subjective intent of

the parties.” Sulzer Carbomedics, Inc. v. Oregon Cardio-Devices,

Inc., 257 F.3d 449, 457 (5th Cir. 2001) (citing Clardy Mfg. Co. v.

Marine Midland Bus. Loans Inc., 88 F.3d 347, 352 (5th Cir. 1996)).

“If a contract is worded in such a manner that it can be given a

definite or certain legal meaning, then it is not ambiguous.”

Hitzelberger v. Samedan Oil Corp., 948 S.W.2d 497, 503-04 (Tex.
- 10 -

App. 1997, writ denied) (citing Friendswood Dev. Co. v. McDade &

Co., 926 S.W.2d 280, 282 (Tex. 1996); Coker v. Coker, 650 S.W.2d

391, 393 (Tex. 1983); R & P Enters. v. LaGuarta, Gavrel & Kirk, 596

S.W.2d 517, 519 (Tex. 1980)). 

C

The 2004 Contract explicitly provides that “[t]he Plan Year is

January 1, 2004 to December 31, 2004.” D. App. 9. Craft does not

argue that the “Administrators . . . extend[ed] the Plan beyond the

Plan Year.” Id. The court therefore concludes, and neither party

disputes, that the 2004 Contract expired by its terms on December

31, 2004. 

Although Craft correctly points out that the provision that

states, “Direct Marketing Commissions are paid quarterly on actual

net revenue,” id. at 12, does not specify that the quarterly

payments will terminate upon the expiration of the Plan Year, a

fair reading of the two documents that make up the 2004 Contract

dictates this conclusion as a matter of law. The ICP contains the

terms and conditions of the compensation system for calendar year

2004 at Harland. Although the ICP states that “[e]ach

Participant’s FY2004 Quota Commitment Worksheet specifies the

opportunities available to the Participant, as well as specific

quotas and commission rates,” D. App. 7 (italics in original), the

Quota Worksheet does not supersede the terms of the ICP. The ICP

clearly provides that it expires on December 31, 2004, and it
- 11 -

states that the “premium commission rate will be in effect

throughout the 2004 calendar year, concluding on December 31,

2004.” Id. at 8. 

Craft argues that “Harland is still obligated to pay

commissions on accounts that generate actual net revenue until

those contracts come to term.” P. Br. 8. But he can point to no

language in the 2004 Contract that requires this conclusion. The

clear and unambiguous language of the 2004 Contract provides that

Harland was obligated to pay Craft direct marketing commissions on

actual net revenue received from National City during calendar year

2004, which is the Plan Year covered by the ICP. Harland was not

required by contract to continue to pay Craft commissions on actual

net revenue that Harland received from National City after the

December 31, 2004 expiration of the 2004 Contract. 

To the extent Craft bases his breach of contract claim on

Harland’s attempt to “force Craft to accept a new contract[ ] to

supersede the FY 2004 contract,” id., the court also concludes that

Harland did not breach its duties under the 2004 Contract. The ICP

clearly provides, under the heading “Right to Amend the Plan,” that

“[t]he Company reserves the right to terminate or amend the Plan to

any extent and in any manner at any time at the sole discretion and

in the final judgment of the Administrators.” D. App. 11. And

because Craft has conceded that “the commission terms of the

contract between Craft and Harland did expire on December 31,
- 12 -

2004,” P. Br. 8, the court holds that changing Craft’s commission

rate from 3% to .01% did not breach the 2004 Contract. 

Finally, the court addresses Craft’s argument that because he

expected Harland to pay him for the 2004 National City contract

according to the terms of the 2004 Contract, Harland committed a

material breach in attempting to change the commission rate once

the 2004 Contract expired. Craft incorrectly states Texas law on

this point, however. The case Craft cites, Hernandez v. Gulf Group

Lloyds, 875 S.W.2d 691, 692-93 (Tex. 1994), provides:

A fundamental principle of contract law is

that when one party to a contract commits a

material breach of that contract, the other

party is discharged or excused from any

obligation to perform. In determining the

materiality of a breach, courts will consider,

among other things, the extent to which the

nonbreaching party will be deprived of the

benefit that it could have reasonably

anticipated from full performance. The less

the non-breaching party is deprived of the

expected benefit, the less material the

breach.

Id. (citations omitted). In the present case, the court need not

determine “the materiality of a breach,” because it concludes that

Harland has not breached the 2004 Contract. And it is clearly

established that, once the court has determined that the contract

is unambiguous, “its language must be enforced as written, looking

at the objective intent as manifested by the language used, rather

than interpreting it by attempting to divine the subjective intent

of the parties.” Sulzer Carbomedics, Inc., 257 F.3d at 457 (citing
- 13 -

Clardy Mfg. Co., 88 F.3d at 352). As explained above, the language

of the 2004 Contract establishes that Harland did not have a duty

to pay Craft a 3% commission on the National City contract after

the 2004 Contract expired on December 31, 2004. Craft’s subjective

expectations are therefore irrelevant in determining whether

Harland has breached the contract. 

The court concludes as a matter of law that the 2004 Contract

expired by its terms on December 31, 2004. Neither party disputes

that Harland paid Craft the commissions he was due on revenue

received from Craft’s accounts through December 31, 2004. Under

the terms of the 2004 Contract, Harland was not obligated to pay

Craft commissions on revenue that Harland received after the

expiration of the Plan Year. Accordingly, the court holds, as a

matter of law, that Craft cannot establish that Harland breached

the 2004 Contract, and Harland is entitled to summary judgment

dismissing Craft’s breach of contract claim. 

IV

The court turns next to Craft’s conversion claim.

A

Craft seeks to recover for conversion based on the allegation

that he has the right to immediate possession of his commissions

because he earned them under the Plan. He posits that by refusing

to remit to him the payment of commissions, Harland exercised and

continues to exercise control over Craft’s property.
- 14 -

Harland moves for summary judgment, contending that Craft

cannot establish that he is entitled to any commissions that he has

not yet received. Craft responds that he does not need to show a

contract, but only that he owns, legally possesses, or is entitled

to the immediate possession of property. He argues that evidence

shows that he performed work for Harland for which he was never

paid, and that Harland thereby converted his commissions.

B

To prove conversion under Texas law, a

plaintiff must establish: (1) [he] owned,

possessed, or had the right to immediate

possession of the personal property at issue;

(2) the defendant wrongfully exercised

dominion or control over the property; and (3)

the defendant refused the plaintiff’s request

to return the property. 

Port Elevator Brownsville v. Gutierrez, 198 Fed. Appx. 362, 368

(5th Cir. 2006) (per curiam) (citing Apple Imps. v. Koole, 945

S.W.2d 895, 899 (Tex. App. 1997, writ denied)). The court has

concluded above that Harland does not owe Craft any commissions on

direct marketing revenue under the 2004 Contract. The evidence

also establishes that Craft refused to sign the Proposed 2005

Contract, which would have entitled him to .01% of the direct

marketing revenue during the first quarter of 2005. The court thus

concludes that from January 1, 2005 until Craft resigned in April

2005, no commission contract existed between Harland and Craft.

Accordingly, Harland is entitled to summary judgment dismissing

Craft’s conversion claim, because Craft has not adduced evidence
- 15 -

sufficient to permit a reasonable jury to find that he “owned,

possessed, or had the right to immediate possession” of any

commissions. Id.

V

Harland argues that it is entitled to summary judgment on

Craft’s Texas Labor Code claim because to prevail under § 61.015 of

the Texas Labor Code, the plaintiff must establish that wages paid

on commission are due according to the terms of an agreement

between the employee and the employer. Section 61.015 provides

that “[w]ages paid on commission and bonuses are due according to

the terms of . . . an agreement between the employee and

employer[.]” Tex. Lab. Code Ann. § 61.015(a) (Vernon 2006).

Because the court has held above that Harland does not owe Craft

any commission payments under the 2004 Contract, and because after

the expiration of this contract, no new commission contract was

formed between Craft and Harland, the court dismisses Craft’s Texas

Labor Code claim. The court concludes, as a matter of law, that

Craft has not established that commissions are due according to the

terms of an agreement between Craft and Harland.

VI

Harland also argues that it is entitled to summary judgment on

Craft’s claims for fraudulent misrepresentation and fraudulent

inducement because Craft cannot establish that false

representations were made. In his response, Craft does not address
- 16 -

Harland’s argument and does not adduce evidence of false

representations. 

Harland correctly argues that, to recover for fraudulent

misrepresentation or fraudulent inducement, Craft would have to

present evidence that Harland made material false representations.

See, e.g., Fletcher v. Edwards, 26 S.W.3d 66, 77 (Tex. App. 2000,

pet. denied) (stating elements of fraudulent inducement claim,

including material misrepresentation that was false); Guillet v.

Fairfield Fin. Group, Inc., 1996 WL 496912, at *4 (Tex. App. Aug.

29, 1996, writ denied) (not designated for publication) (citing

T.O. Stanley Boot Co. v. Bank of El Paso, 847 S.W.2d 218, 222 (Tex.

1992) (stating that elements of fraudulent misrepresentation

include material misrepresentation that was false). Because Craft

has not introduced such evidence, the court grants Harland’s motion

for summary judgment dismissing these claims.

VII

Finally, the court considers Craft’s quantum meruit claim.

A

Craft alleges that he is entitled to recover in quantum meruit

because he provided valuable services to Harland by negotiating and

closing the direct marketing contract between Harland and National

City, and Harland accepted the services with actual and

constructive awareness that Craft expected payment for them.

Harland moves for summary judgment on this claim, arguing that
- 17 -

it is well settled under Texas law that a plaintiff cannot recover

in quantum meruit if a valid express contract covers the services

provided. Harland argues that Craft was obligated to perform the

negotiating and closing of the contract between Harland and

National City as part of his contractual obligations under the 2004

Contract; therefore, Craft cannot recover in quantum meruit for the

services he rendered to Harland.

Craft responds that he received no compensation for National

City (or any client) during the first quarter of 2005, because of

his refusal to accept the new Proposed 2005 Contract. He maintains

that if the 2004 National City contract is not covered under the

2004 Contract, then Harland has been unjustly enriched at Craft’s

expense, and a jury should be allowed to determine the value of the

services he provided to Harland without payment.

B

“The existence of a valid, express contract that covers the

subject matter of the parties’ dispute generally precludes recovery

under a quasi-contract theory.” Williams v. Colonial Bank, N.A.,

199 Fed. Appx. 399, 403 (5th Cir. 2006) (per curiam) (citing

Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671, 684 (Tex. 2000)).

Thus because an express agreement governed the terms of Craft’s

employment, he cannot recover in quantum meruit for the services he

rendered in helping to boost direct marketing sales with National

City. See Vortt Exploration Co. v. Chevron U.S.A., Inc., 787
- 18 -

S.W.2d 942, 944 (Tex. 1990) (“Generally, a party may recover under

quantum meruit only when there is no express contract covering the

services or materials furnished.”). He is limited to the

compensation outlined in his employment agreement with Harland.

See First Union Nat’l Bank v. Richmont Capital Partners I, L.P.,

168 S.W.3d 917, 931 (Tex. App. 2005, no pet.) (noting that, when a

relevant contract exists, “there can be no recovery under a quasicontract theory because parties should be bound by their express

agreements”). 

Craft received a base salary for his work as a salesman for

Harland. During calendar year 2004, Craft was entitled to

commissions based on direct marketing revenue, but once the

contract expired and Craft refused to sign the Proposed 2005

Contract, he was no longer entitled to commissions for his work and

was relegated to his base salary alone. Regardless, when Craft

actually secured the National City contract (the valuable service

Craft provided to Harland), he was performing an obligation he owed

Harland under the 2004 Contract and was compensated for his work

under that contract. Accordingly, because the 2004 Contract

expressly covered Craft’s services in securing the National City

contract, he cannot recover from Harland in quantum meruit.
- 19 -

* * *

Harland’s February 1, 2007 motion for partial summary judgment

is granted, and Craft’s claims are dismissed with prejudice. Only

the claims asserted in Harland’s counterclaim remain for trial.

SO ORDERED.

August 14, 2007.

_________________________________

SIDNEY A. FITZWATER

UNITED STATES DISTRICT JUDGE