Opinion ID: 1033488
Heading Depth: 2
Heading Rank: 1

Heading: Assignment of Retainage

Text: [¶27] Herling resisted Wyoming Machinery’s motion for summary judgment by asserting that JHCI’s assignment of retainage released him from his personal guaranties, an assertion which was supported by the assignment, his affidavit, and an excerpt of his deposition testimony. JHCI’s retainage assignment provided as follows: RECITALS: . . . B. Jerry Herling Construction, Inc. has an outstanding balance owed to Wyoming Machinery Company in the amount of $1,383,472.93 as of September 13, 2008 . . . . C. Tetra Tech EC, Inc. is in possession of certain funds owed to Jerry Herling Construction, Inc. within the retainage account of Tetra Tech EC, Inc. 7 D. In connection therewith, Jerry Herling Construction, Inc. desires to transfer and assign to Wyoming Machinery Company, and Wyoming Machinery Company desires to acquire, all of Jerry Herling Construction, Inc.’s right, title and interest in and to any and all retainage funds and other tangible and intangible asserts arising out of the relationship between Jerry Herling Construction, Inc. and Tetra Tech EC, Inc., up to an amount sufficient to pay the entire balanced [sic] owed on Account No. []. NOW, THEREFORE, for Ten and no/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Jerry Herling Construction, Inc. and Wyoming Machinery Company hereby agree as follows: AGREEMENT: 1. Assignment. Jerry Herling Construction, Inc. hereby grants, transfers, assigns and sets over to Wyoming Machinery Company all of Jerry Herling Construction, Inc.’s right, title and interest in and to any funds held on its behalf in the Tetra Tech EC, Inc. retainage account and any and all tangible and intangible assets arising out of the relationship between Jerry Herling Construction, Inc. and Tetra Tech EC, Inc. (the “Assigned Property”) up to an amount sufficient to pay the entire balanced [sic] owed now or in the future on Account No. []. . . . 3. Jerry Herling Construction, Inc. understands that this assignment in and of itself is not a payment of any amounts owed on Account No. [] and that only receipt of actual funds from Tetra Tech EC, Inc. or Jerry Herling Construction, Inc. will be considered a payment on Account No. []. Jerry Herling Construction, Inc. continues to be liable for all unpaid balances on Account No. [] and Wyoming Machinery Company retains the right to pursue Jerry Herling Construction, Inc. for the same. Wyoming Machinery Company has the right, but not the obligation, to pursue Tetra Tech EC, Inc. for recover[y] of the Assigned Property. . . . 8 [¶28] Herling claims that his execution of JHCI’s assignment of its interest in the retainage funds operated as a release of his personal guaranties. He acknowledges that the plain language of the assignment did not release JHCI, but contends that its silence with regard to releasing him personally means that he was in fact released. He also claims that his purported release from his guaranties was the consideration for him to agree to the assignment on JHCI’s behalf. He argues that this defense is also supported by representations by a managerial employee of Wyoming Machinery, who he claims told him that he would not be sued on his guaranties if JHCI assigned its interest in the retainage. [¶29] Herling filed an affidavit which stated as follows: 2. Wyoming Machinery Company (“WMC”), through its employees and representatives, agreed that it would release me from liability on my personal guarantee if I caused JHCI to assign its retention under the Tetra Tech contracts. 3. JHCI assigned to WMC its retention under the Tetra Tech contracts in exchange for that release from my personal guarantee for the debts of JHCI. I relied upon such representation by WMC and its representatives in causing the assignment to be made. [¶30] We have often stated that conclusory statements are insufficient to generate a genuine issue of material fact. Creel v. L & L, Inc., 2012 WY 124, ¶ 50, 287 P.3d 729, 744 (Wyo. 2012) (citing Boehm v. Cody Country Chamber of Commerce, 748 P.2d 704, 710 (Wyo. 1987)). Herling’s affidavit is clearly conclusory–it does not identify the employees who are claimed to have agreed to release him personally or the terms of the agreement. It reflects what he claims was his motivation or understanding, but it does not set forth specific facts which would support the conclusions asserted. The affidavit is insufficient to generate a genuine issue of material fact. [¶31] Herling’s deposition testimony about the conversation is somewhat more specific: Q: Okay. At some point did you talk with Wyoming Machinery about assigning your interest to the retainage – A: Yes. Q: – on the project? Tell me about those conversations. A: Well, I was – I was trying to help Wyoming Machinery, working directly with Arik [Arik Christensen, Wyoming 9 Machinery’s Credit and Collections Manager], to try to get his money. And – and, you know, I actually – I actually called them up and asked, “Hey, you know, we” – you know, “What are we going to do here?” you know. And he – he said that his attorney was working on something and to come over to his office. So I went over to his office and he had this Assignment of – of Retention. And I kind of asked, “Well, what’s this?” He goes, “Well, lien rights are really kind of” – “you know, kind of” – “kind of rough in Wyoming, and this is a way for him to get his money.” I said, Well, you know” – “you know, I don’t want to get sued. I don’t want my company to get sued; I don’t want to get sued personally. I don’t want any of that.” And he – and his attorney – the attorney was a – it was a lady I was talking to, I believe, that was on the phone at that – she was on the phone. And I wanted an explanation of this. I said, “Well, I don’t want to be sued.” And it’s like, “Well, if you sign this Assignment of Retention, you won’t be sued.” And I signed that – that Assignment of Retention. Q: Who made that statement? Was it the attorney or was it Arik? A: I – I believe it was Arik. I believe it was this – “You sign this” – This is a way so we don’t have to sue you,” assigning the – the – the retention, which it was almost $2 million in retention in there, and it would have covered his bill sufficiently. [¶32] Herling argues that he raised genuine issues of material fact as to whether he was released from his guaranties based on the language of the assignment when viewed in conjunction with the above testimony, and that the district court therefore erred in entering summary judgment for Wyoming Machinery. [¶33] We must first determine whether the assignment was ambiguous. “An ambiguous contract is an agreement which is obscure in its meaning because of indefiniteness of expression or because of a double meaning being present.” Farr v. Link, 746 P.2d 431, 433 (Wyo. 1987) (citing E & E Mining, Inc. v. Flying “D” Group, Inc., 718 P.2d 58 (Wyo. 1986)). JHCI assigned Wyoming Machinery its interest in retainage funds held by 10 Tetra Tech up to the amount JHCI owed to Wyoming Machinery. JHCI also agreed that the assignment did not constitute payment of any amounts owed on the account, and that only receipt of actual funds from Tetra Tech would constitute a payment on JHCI’S account. No payments were ever made as a result of the assignment. [¶34] Herling was not a party to the assignment; he executed it on behalf of JHCI. The assignment is neither ambiguous nor obscure, and the material facts surrounding its execution are undisputed. [¶35] When there is no ambiguity in a written agreement, we determine the parties’ intent from the language of the contract alone. See Knight, ¶ 7, 248 P.3d at 181; In re Mark E. Dowell Irrevocable Trust # 1, 2012 WY 154, ¶ 18, 290 P.3d 357, 361 (Wyo. 2012). (“[A] court should not resort to extrinsic or parol evidence or rules of contract construction to avoid or enlarge the clearly expressed intent of the parties.”) (citation omitted). Also, “where the contract is entirely silent as to a particular matter, the courts will exercise great caution not to include in the contract, by construction, something which was intended to be excluded.” N. Ohio Traction & Light Co. v. State of Ohio ex rel. Pontius, 245 U.S. 574, 590, 38 S. Ct. 196, 201, 62 L. Ed. 481 (1918) (Clarke, J., dissenting) (quoting E. Ohio Gas Co. v. City of Akron, 90 N.E. 40 (Ohio 1909)). “Mere silence as to [a] claim cannot be construed to constitute a release thereof.” City Nat’l Bank of Huron, S.D., v. Fuller, 52 F.2d 870, 877 (8th Cir. 1931). [¶36] The assignment does not by its clear terms release Herling from his guaranties. If the parties to the assignment had intended to release Herling from his personal guaranties, language to accomplish that end could easily have been included. [¶37] We have held that a court may “confirm its understanding of otherwise seemingly unambiguous language by reviewing evidence which, although extrinsic to the contract, complements that language by clarifying the context in which the agreement was drawn.” Mark E. Dowell Irrevocable Trust, ¶ 18, 290 P.3d at 361 (citing Knight, ¶ 7, 248 P.3d at 181). Herling’s testimony, even when viewed in the light most favorable to him as it must be on a motion for summary judgment, does not raise a genuine issue of material fact as to the meaning of the release itself. It is apparent from the excerpt quoted above that the term “you” was never defined, and that the word was as probably used to refer to JHCI as to Herling personally, although Herling also claims to have spoken of avoiding a personal lawsuit. [¶38] Beyond that, the testimony does not suggest that the Wyoming Machinery representative told Herling that the company would release him from his personal guaranties–he only indicated that Herling would not be sued, without specifying a time frame. Finally, as already noted, the assignment itself does not release JHCI from its contractual obligations, although JHCI would be credited for payments by Tetra Tech if any were made under the assignment. The testimony suggests no reasonable explanation 11 for Wyoming Machinery to decline to release JHCI while releasing Herling, an evidently solvent guarantor. [¶39] Moreover, there is no indication in the record that Herling is unable to read or that the contents of the assignment were misrepresented to him. We have held that a person signing a document is presumed to have read and understood its contents: The rule is that the one who signs a paper, without reading it, if he is able to read and understand, is guilty of such negligence in failing to inform himself of its nature that he cannot be relieved from the obligation contained in the paper thus signed, unless there was something more than mere reliance upon the statements of another as to its contents . . . . Laird v. Laird, 597 P.2d 463, 467 (Wyo. 1979) (quoting Sanger v. Yellow Cab Co., Inc., 486 S.W.2d 477, 481 (Mo. 1972)). This is especially true where, as in this case, both parties to a commercial contract are “sophisticated business people . . . [who] have a duty to read the contract carefully.” See Cara’s Notions, Inc. v. Hallmark Cards, Inc., 140 F.3d 566, 571 (4th Cir. 1998). Herling was the CEO of companies with several decades of excavating experience, including approximately one hundred wind farm projects. [¶40] The district court correctly analyzed the record and properly held that there were no genuine issues of material fact and that the assignment did not release Herling from his guaranties as a matter of law. See Sturman v. First Nat’l Bank, 729 P.2d 667, 677 (Wyo. 1986) (“Summary judgment is proper where the language of an agreement is plain and unambiguous.”); 11 James Wm. Moore et al., Moore’s Federal Practice § 56.25[1][a] (3d ed. 2011) (summary judgment is particularly appropriate where a claim or defense is predicated on the interpretation of an unambiguous contract). II. Waiver, Promissory Estoppel, and Accord and Satisfaction [¶41] Herling also claims that the oral statements of the Wyoming Machinery representative released him from his guarantee by virtue of the doctrines of waiver, promissory estoppel, and accord and satisfaction in support of his arguments. He refers us only to the basic “black-letter law” of those doctrines, and does not attempt to relate the applicable law to the facts of his case. In a similar case, we observed as follows: An appellant is required to present this court with relevant authority and cogent argument. It is not enough to identify a potential issue with the expectation that this court will flesh out the matter from there. The appellant, at a minimum, must attempt to relate the rule of law he depends upon to the facts of his case. 12 Elder v. Jones, 608 P.2d 654, 660 (Wyo. 1980); see also W.R.A.P. 7.01(f)(1) (requiring an appellant’s brief to set forth the “[a]ppellant’s contentions with respect to the issues presented”); BB v. RSR, 2007 WY 4, ¶ 16, 149 P.3d 727, 734 (Wyo. 2007) (“Mother’s vague assertions unsupported by citation to the record do not comply with the requirements of W.R.A.P. 7.01(f)(1) and, therefore, we need not consider her contention.”); Dechert v. Christopulos, 604 P.2d 1039, 1045 (Wyo. 1980) (“An argument which is not briefed according to our rules of appellate procedure will not be considered.”). [¶42] Although we would be justified in moving on to other issues after this limited analysis, we will comment briefly on the merits for the sake of completeness. “[T]he elements of waiver are (a) existing right; (b) knowledge of that right; and (c) intent to surrender or relinquish it.” Ramirez v. Metropolitan Life Ins. Co., 580 P.2d 1136, 1138 (Wyo. 1978). Nothing in Herling’s deposition testimony suggests any intent on the part of Wyoming Machinery to release him from his guaranties, and the express language of the assignment demonstrates that although Wyoming Machinery would credit JHCI for any funds actually paid out of retainage, the assignment itself was not a release. [¶43] The elements of promissory estoppel are: (1) the existence of a clear and definite promise which the promisor should reasonably expect to induce action by the promisee; (2) proof that the promisee acted to its detriment in reasonable reliance on the promise; and (3) a finding that injustice can be avoided only if the court enforces the promise. Redland, ¶ 91, 288 P.3d at 1194 (quoting Parkhurst v. Boykin, 2004 WY 90, ¶ 21, 94 P.3d 450, 460 (Wyo. 2004)). [¶44] The record raises no genuine issue of material fact with regard to any of the elements of promissory estoppel. There was no “clear and definite promise” to release Herling from his guarantee. There is no proof that Herling acted to his detriment–in fact, the assignment kept Wyoming Machinery from withdrawing its equipment for a short time, benefiting JHCI and probably Herling as well. Finally, it is impossible to find that any injustice was done to Herling, as he gave up nothing by executing the assignment on behalf of JHCI. Tetra Tech refused to honor it, meaning that JHCI’s retainage remained its possession. 13 [¶45] Finally, the elements of a common law accord and satisfaction6 are: (1) that a bona fide dispute existed as to the amount owed that was based on mutual good faith; (2) that the debtor tendered an amount to the creditor with the intent that payment would be in total satisfaction of the debt; and (3) that the creditor agreed to accept the payment in full satisfaction of the debt. Acierno v. Worthy Bros. Pipeline Corp., 693 A.2d 1066, 1068 (Del. 1997) (footnote omitted). There are no genuine issues of material fact as to any of these elements. The amount JHCI owed Wyoming Machinery was not disputed, and neither was the validity of Herling’s guaranties. The assignment was clear that it did not operate as a release of any obligation except to the extent that funds were paid to Wyoming Machinery. [¶46] For these reasons, we conclude that there were no genuine issues of material fact as to Herling’s assertion of the defenses of waiver, promissory estoppel, and accord and satisfaction, and Wyoming Machinery was entitled to judgment as a matter of law, as the district court held.