Court Opinion

ID: 9956618
Source: CourtListenerOpinion
Date Created: 2024-04-02 17:02:28.642204+00
Date Added: 2024-06-11T08:17:41.575848
License: Public Domain

NOTICE: NOT FOR OFFICIAL PUBLICATION.
  UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
                  AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

                                     IN THE
              ARIZONA COURT OF APPEALS
                                 DIVISION ONE

                     STEVEN WEDEL, Plaintiff/Appellant,

                                         v.

        OLYMPIAN WORLDWIDE MOVING & STORAGE, INC.,
                     Defendant/Appellee.

                              No. 1 CA-CV 23-0482
                                FILED 4-2-2024

          Appeal from the Superior Court in Maricopa County
                          No. CV2023-090050
      The Honorable Patricia A. Trebesch, Judge Pro Tempore, Retired

                                   AFFIRMED

                                    COUNSEL

Bailey Law Firm PLLC, Tempe
By Jenna C. Bailey
Counsel for Plaintiff/Appellant

Engelman Berger, P.C., Phoenix
By Damien Meyer, Celeste Tabares
Counsel for Defendant/Appellee
                          WEDEL v. OLYMPIAN
                           Decision of the Court

                      MEMORANDUM DECISION

Judge Brian Y. Furuya delivered the decision of the Court, in which Presiding
Judge Anni Hill Foster and Vice Chief Judge Randall M. Howe joined.

F U R U Y A, Judge:

¶1          Steven Wedel appeals the superior court’s dismissal of his
complaint against Olympian Worldwide Moving and Storage, Inc.
(“Olympian”) for failure to state a claim. For the following reasons, we
affirm.

                 FACTS AND PROCEDURAL HISTORY

¶2             We assume the truth of the well-pleaded facts in Wedel’s
complaint and view them in the light most favorable to him as the non-
moving party. See Date St. Cap., LLC v. Clearcover Ins. Co., ___ Ariz. ___, ___
¶ 2, 540 P.3d 921, 924 (App. 2023). Because Wedel’s Sales Agreement is
central to his complaint, we consider it in full, despite not being appended
to his complaint. See id. at 925 ¶ 8 (explaining courts may consider materials
central to the complaint even if not appended to it).

¶3             In July 2021, Olympian, a moving and storage company, hired
Wedel as a salesperson. A three-page Sales Agreement governed Wedel’s
compensation and commissions. Under the agreement, Olympian would
designate and assign or reassign “sales territories, customers, and product
lines to be solicited.” As a salesperson, Wedel was responsible for
“identifying, soliciting, and securing transportation and warehousing
business.” He would also “obtain[] the initial credit information . . .
includ[ing] bank information, trade references, corporate contact name and
the initial request for a letter of authorization.”

¶4            The Sales Agreement contained a commissions clause that
stipulated Olympian would “compensate [Wedel] in the form of
commissions based on revenues derived from the direct sales activities and
efforts of [Wedel]” and would pay such commissions “in the month
following the load date of the specific shipment.” Olympian also reserved
the right to adjust commissions “up to a maximum 100%” for a
salesperson’s non-performance, action, or inaction resulting “with the loss

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of revenue or uncollected funds” for a shipment. The end of the agreement
contained a termination clause which read:

       11. Company may terminate this Agreement, with or without
       cause, at any time. Auto Allowance and advance against
       commission will cease immediately.

       Upon termination of this agreement, Company will pay
       salesperson for shipments loading up to that termination
       date. The final settlement will be paid in 30 days from the
       termination date providing that all shipment details have
       been verified, charges have been collected and no outstanding
       issues exist on any shipment therein as well as the surrender
       and inspection of all company issued equipment.

¶5              Olympian terminated Wedel’s employment on December 20,
2021, at which point Wedel had 28 sales pending to load. On January 5,
2023, Wedel filed a complaint against Olympian, seeking unpaid wages for
those 28 sales. Wedel’s complaint exceeded the one-year statute of
limitations for breach of employment contract claims, including unpaid
wage claims. See Arizona Revised Statutes (“A.R.S.”) § 12-541(3), (5); see also
Redhair v. Kinerk, Beal, Schmidt, Dyer & Sethi, P.C., 218 Ariz. 293, 298–99
¶¶ 20–23, 300 ¶ 27 (App. 2008) (explaining that unpaid wage claims arise
under A.R.S. § 23-355, and as such, have a one-year statute of limitations
under A.R.S. § 12-541(3) or (5)). But Olympian waived this defense by not
raising it in its motion to dismiss. See Ritchie v. Krasner, 221 Ariz. 288, 304 ¶
56 (App. 2009) (affirmative defense of statute of limitations is waived unless
raised). We therefore address the merits.

¶6            Wedel’s complaint alleged that Olympian violated Arizona
wage laws and breached the Sales Agreement. Wedel alleged he “expected
to be paid his wages for the hours he worked in finalizing these sales
agreements” and argued the commission clause obligated Olympian to pay
commissions for those sales. Though the complaint quoted the termination
clause, it did not address or discuss it in its claim for unpaid wages or
request for relief.

¶7           Olympian moved to dismiss the complaint for failure to state
a claim under Arizona Rule of Civil Procedure (“Rule”) 12(b)(6). It argued
Wedel’s “own allegations establish the parties entered into an enforceable
contract for compensation that limited [Wedel’s] right to payment to
shipments loading up to the termination date.” Wedel’s response focused
on the termination clause and argued that it is an “unexpected hidden

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term” and is “unconscionable, illegal, [and] against public policy,” and,
thus, unenforceable. After receiving Olympian’s reply, the court held oral
argument and concluded “the terms of the agreement between the parties
are clear and unambiguous” and, therefore, it had no “choice but to dismiss
the complaint.”

¶8          Olympian requested attorneys’ fees and costs in its motion to
dismiss under A.R.S. § 12-341.01(A). After considering Wedel’s objection
and Olympian’s reply, the court awarded Olympian its attorneys’ fees and
costs.

¶9             We have jurisdiction over Wedel’s timely appeal under
Article 6, Section 9 of the Arizona Constitution and A.R.S. §§ 12-120.21(A)
and -2101(A).

                               DISCUSSION

¶10          On appeal, Wedel argues the superior court erred in
dismissing his complaint and in awarding Olympian its attorneys’ fees.

I.     The Court Properly Dismissed Wedel’s Complaint.

¶11            We review de novo orders granting a motion to dismiss for
failure to state a claim under Rule 12(b)(6). Silverman v. Ariz. Health Care
Cost Containment Sys., 255 Ariz. 387, 390 ¶ 9 (App. 2023). When reviewing a
dismissal pursuant to Rule 12(b)(6), “we consider only the complaint and
its well-pled factual allegations and assume the truth of those allegations.”
Luu v. Newrez, LLC, 253 Ariz. 159, 162 ¶ 8 (App. 2022) (citing Cullen v. Auto-
Owners Ins. Co., 218 Ariz. 417, 419 ¶ 7 (2008)). We affirm dismissal under
Rule 12(b)(6) only if, as a matter of law, plaintiffs “would not be entitled to
relief under any interpretation of the facts susceptible of proof.” Doe v.
Roman Cath. Church of Diocese of Phoenix, 254 Ariz. 522, 527 ¶ 14 (App. 2023)
(quoting Fid. Sec. Life Ins. Co. v. State Dep’t of Ins., 191 Ariz. 222, 224 ¶ 4
(1998)).

       A.     The Sales Agreement is Clear and Unambiguous.

¶12           Arizona’s public policy dictates that “[t]he employment
relationship is contractual in nature.” A.R.S. § 23-1501(A)(1). “[W]hen
parties bind themselves by a lawful contract, the terms of which are clear
and unambiguous, a court must give effect to the contract as written.”
Grosvenor Holdings, L.C. v. Figueroa, 222 Ariz. 588, 593 ¶ 9 (App. 2009)
(quoting Grubb & Ellis Mgmt. Servs., Inc. v. 407417 B.C., LLC, 213 Ariz. 83, 86
¶ 12 (App. 2006)). We look to “the plain meaning of the words in the context

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of the contract as a whole” to give effect to the parties’ intent. Id. Further,
wherever possible, we “attempt to reconcile and give effect to all terms of
the contract to avoid any term being rendered superfluous.” Terrell v. Torres,
248 Ariz. 47, 50 ¶ 14 (2020) (as amended).

¶13           Here, the Sales Agreement clearly and unambiguously limits
commission on termination to sales loaded before the employee’s
termination date. Wedel does not claim the contract is ambiguous and does
not challenge its meaning in any other way. Instead, he argues that the
commission clause and the termination clause contradict each other. But
these clauses address compensation in different scenarios. The commission
clause describes when Olympian will pay an employed salesperson
commission, whereas the termination clause describes the commission
owed a terminated salesperson. These clauses are not contradictory.

¶14             That conclusion is not new or novel. In Thermo-Kinetic Corp. v.
Oliver, a contract provision creating a scheme where a salesperson earned
half their commissions upon securing a contract and the other half on
closing was consistent with a term allowing the employer to retain half of
unpaid commissions for unfinished sales at the time of an employee’s
termination. 22 Ariz. App. 109, 110–11 (1974). More recently, in Lane v.
Statesman Sales & Mktg. LLC, we examined an employment contract
providing that an employer would pay half of the commission for the sale
of real property when its employee executed a condo purchase contract. 1
CA-CV 20-0396, 2021 WL 4901487, at *1 ¶ 2 (App. Oct. 21, 2021) (mem.
decision), review denied (Nov. 1, 2022). After closing and title transfer, the
employer would pay the other half of commissions. Id. at *1 ¶¶ 2, 6. Under
a termination provision of the contract, employees forfeited commission for
sales if not employed “at the closing/occupancy date” of those sales. Id. at
*1 ¶ 3. We concluded the commission and termination provisions did not
conflict. Id. at *2 ¶ 11. One clause addressed when commission was to be
paid, while the other addressed compensation upon termination. Id. We
held that “[r]eading the contract as a whole, [the termination clause] reflects
the parties’ intent that salespeople must perform additional duties before
closing, and the two-part commission structure . . . is consistent with that
intent.” Id. at *3 ¶ 16.

¶15           Wedel argues Lane is distinguishable because, unlike the
employees in Lane, he had no remaining duties after ensuring customers
signed their contracts. Not so. Our decision in Lane, first and foremost,
turned on the employment contract’s express language. Id. at *2 ¶¶ 11–12
(resolving dispute as to contract language). As in Lane, this case turns on
the express language of an employment contract, which clearly and

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unambiguously sets the conditions and terms for payment of commissions
after termination occurs. See id. The Sales Agreement in this case explicitly
provides that only those shipments that had loaded “up to [the] termination
date” were subject to payment of any commission. Thus, we enforce the
Sales Agreement according to its clear and unambiguous terms. See
Grosvenor, 222 Ariz. at 593 ¶ 9. Given the express term precluding liability
for payment of commissions from sales that loaded after the date of Wedel’s
termination, it was not reasonable to expect payment of such as wages, see
A.R.S. § 23-350, and therefore, the court did not err in granting Olympian’s
motion to dismiss under Rule 12(b)(6).

      B.     Wedel’s Enforceability Arguments are Unavailing.

¶16           The superior court was not required to consider Wedel’s
enforceability arguments because he did not raise them in his complaint.
See Cullen, 218 Ariz. at 419 ¶ 7. Wedel’s complaint argued that “[u]nder the
agreement [he] was to be paid his commissions” because he “expected to
be paid his wages for the hours he worked in finalizing . . . sales
agreements” for the sales pending to load after his termination. Nothing in
Wedel’s complaint mentions enforceability, unconscionability, or public
policy.

¶17           Nevertheless, Wedel argued enforceability in his response to
Olympian’s motion to dismiss and to the superior court during oral
argument. During oral argument, the court asked Wedel if he intended to
amend the complaint. Wedel responded he had considered alleging unjust
enrichment but “that position is well down the list in terms of what
arguments are, I believe.” And Wedel never moved to amend his
complaint. Further, the superior court did not rely on Wedel’s
enforceability arguments in its ruling. Instead, the court granted
Olympian’s motion to dismiss based on the contract terms alone, reasoning
that because “the terms of the agreement between the parties are clear and
unambiguous” it had no “choice but to dismiss the complaint.”

¶18           Because Wedel did not include any enforceability arguments
in his complaint and the court did not rely on those arguments, we need
not address them. See Cullen, 218 Ariz. at 419 ¶ 7. But cf. Ariz. R. Civ. P.
15(b)(2) (requiring a court to consider issues omitted from pleadings if
“tried by the parties’ express or implied consent”).

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                           WEDEL v. OLYMPIAN
                            Decision of the Court

¶19           The Sales Agreement clearly and unambiguously stipulates
terminated salespersons will not be paid commission for sales loading after
their termination date. Taking Wedel’s allegations framed in his complaint
as true does not change the clear and unambiguous language of the
agreement. Therefore, we affirm the superior court’s grant of Olympian’s
motion to dismiss for failure to state a claim.

II.    The Court Did Not Abuse its Discretion by Awarding Attorneys’
       Fees to Olympian.

¶20            We review an award of attorneys’ fees and costs for an abuse
of discretion and will affirm the award if supported by any reasonable
basis. Peterson v. City of Surprise, 244 Ariz. 247, 253 ¶ 25 (App. 2018). “In any
contested action arising out of a contract, express or implied, the court may
award the successful party reasonable attorney fees.” A.R.S. § 12-341.01(A).

¶21             To determine whether to award fees under A.R.S. § 12-
341.01(A), courts should consider the following factors: (1) the merits of the
unsuccessful party’s claims and defenses; (2) “whether the parties could
have avoided or settled the litigation and whether ‘the successful party’s
efforts were completely superfluous in achieving the result’”; (3) whether
the fee award will cause extreme hardship for the paying party; (4)
“whether the successful party prevailed on all relief sought”; (5) the novelty
of the issues; (6) whether the claims or defenses are issues of first impression
in Arizona; and (7) “whether an award of fees would discourage other
parties with tenable claims or defenses from litigating or defending
legitimate contract issues for fear of incurring liability for substantial
amounts of attorney fees.” Orfaly v. Tucson Symphony Soc’y, 209 Ariz. 260,
265–66 ¶ 19 (App. 2004) (quoting Associated Indem. Corp. v. Warner, 143 Ariz.
567, 570 (1985)).

¶22            The superior court found factors one, four, six, and seven
weighed in favor of the award because: Wedel’s claims were meritless;
Olympian prevailed as to all relief sought; “[c]laims and defenses involving
interpretation of employment contracts are common”; and “the arguments
by [Wedel] . . . relied largely on the unfairness of the contract and public
policy arguments rather than the plain and unambiguous language of the
contract” such that “this matter would have no impact on other actions
litigating legitimate contract issues.”

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                            Decision of the Court

¶23            The court found factors two and five were neutral because the
parties provided no information regarding whether Olympian’s efforts to
avoid litigation or settle the dispute were superfluous and there were no
novel or unique legal issues involved in the case. The court found the third
factor weighed against the award because Wedel claimed he would suffer
extreme hardship at the expense of the award. On this record, we find the
court provided a reasonable basis for its award pursuant to A.R.S. § 12-
341.01.

¶24           We also review the amount of attorneys’ fees awarded for an
abuse of discretion. Modular Mining Sys., Inc. v. Jigsaw Techs., Inc., 221 Ariz.
515, 521 ¶ 21 (App. 2009). The superior court has broad discretion in
determining the amount of attorneys’ fees awarded under A.R.S. § 12-
341.01(A). Vortex Corp. v. Denkewicz, 235 Ariz. 551, 562 ¶ 39 (App. 2014).
After the requesting party submits an affidavit detailing its fees, the
opposing party bears the burden to show the fees are improper or
unreasonable. In re Indenture of Tr. Dated January 13, 1964, 235 Ariz. 40, 52–
53 ¶ 47 (App. 2014). But the opposing party “does not meet his burden
merely by asserting broad challenges to the application” and must do more
than “simply state . . . that the hours claimed are excessive and the rates
submitted too high.” Id. (quoting State ex rel. Corbin v. Tocco, 173 Ariz. 587,
594 (App. 1992) (citation omitted)).

¶25           In Wedel’s response to Olympian’s application for fees, he
challenged the length of time spent on various tasks. Each of Wedel’s
complaints combines several entries. For example, Wedel argues seven
hours spent “to review a substantively two-page responsive letter” was
excessive. But those seven hours accounted for six separate tasks, the
longest of which was 2.5 hours spent doing research and drafting a letter.
He also argues four hours of time, spread across 15 tasks was excessive.
Wedel did not provide any other argument or information as to his belief
that the fees were excessive other than to argue large sets of tasks took too
long. None of the individual entries Wedel cites are facially excessive. On
this record, the superior court did not abuse its discretion to award
Olympian its requested fees.

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                          WEDEL v. OLYMPIAN
                           Decision of the Court

                             CONCLUSION

¶26          We affirm.

¶27           On appeal, both parties request an award of their respective
attorneys’ fees and costs. Olympian cites A.R.S. § 12-341.01 in its request.
After consideration and in the exercise of our discretion, we award
Olympian, the successful party, its reasonable attorneys’ fees and costs
upon compliance with Arizona Rule of Civil Appellate Procedure 21.

                           AMY M. WOOD • Clerk of the Court
                           FILED: AA

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