Court Opinion

ID: 45824
Source: CourtListenerOpinion
Date Created: 2010-04-25 22:45:18+00
Date Added: 2024-06-11T17:17:30.099102
License: Public Domain

United States Court of Appeals
                                                                Fifth Circuit
                                                             F I L E D
               IN THE UNITED STATES COURT OF APPEALS
                                                           September 11, 2006
                        FOR THE FIFTH CIRCUIT
                                                         Charles R. Fulbruge III
                                                                 Clerk

                            No. 05-51650

     DONNIE WILLIAMS,

                                           Plaintiff-Appellant,
          versus

     COLONIAL BANK, N.A., as successor-in-interest
     to First Mercantile Bank, N.A. and
     THE COLONIAL BANCGROUP, INC. as successor-in-interest
     to Mercantile Bancorp, Inc.,

                                           Defendants-Appellees.

          Appeal from the United States District Court
                for the Western District of Texas

Before KING, GARWOOD, and JOLLY, Circuit Judges.

PER CURIAM:1

     Plaintiff-appellant Donnie Williams (Williams) appeals the

district court’s September 21, 2005 Order denying his Motion to

Alter or Amend Judgment and its August 22, 2005 final Amended

Judgment that Williams take nothing in his suit against defendants-

appellees Colonial Bank, N.A. (Colonial Bank) and The Colonial

     1
      Per 5th Cir. R. 47.5, the court has decided that this
opinion should not be published and is not precedent except under
those limited circumstances set forth by 5th Cir. R. 47.5.4.
Bancgroup, Inc. (Colonial Bancgroup).          We affirm.

                      FACTS AND PROCEEDINGS BELOW

     In 1999, First Mercantile Bank (First Mercantile), located in

Dallas, a wholly owned subsidiary of Mercantile Bancorp, Inc.

(Mercantile), decided to open a branch bank in Austin.              By letter

dated April 4, 2000, Roy Salley, First Mercantile Bank president

and holding company CEO, offered Williams, and Williams accepted,

the position of area president of First Mercantile’s Austin branch

bank.

     Williams joined First Mercantile in May 2000.           His employment

agreement included both non-incentive and performance-based stock

options.     Specifically,     upon   hire,    First   Mercantile       granted

Williams ten thousand stock options outright, and it was further

agreed that:

     “After three months of profitability, you will receive an
     additional 5,000 stock options at the then current stock
     price to be vested out over five years. Finally, if you
     achieve $50 million in total assets within 24 months from
     the opening of the Austin branch, you will receive 5,000
     stock options at the then current stock price to be
     vested over five years.”

The Austin branch opened in March 2001.

     On    November   29,   2001,   Mercantile    entered    into   a    merger

agreement with Colonial Bancgroup.         Subsequently, on January 10,

2002,   First   Mercantile   executed     an   agreement    of   merger   with

Colonial Bank, a subsidiary of Colonial Bancgroup.               On March 21,

2002, Williams executed an employment agreement with Colonial Bank

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that designated Williams as Branch President/Austin-Lender of the

Texas Region following the merger.   The agreement, stated to take

effect upon the merger, did not mention any performance-based stock

options and included the following provision:

     “This Agreement constitutes the entire understanding and
     agreement between the parties hereto with respect to the
     subject matter hereof, and there are no agreements,
     understandings,   restrictions,    representations,    or
     warranties between the parties other than those set forth
     or provided for herein.”

Parent companies Mercantile and Colonial Bancgroup merged on March

28, 2002.   Colonial Bank and First Mercantile merged the next day.

Colonial Bancgroup and Colonial Bank are the surviving entities.

At the time of the merger, neither of the two performance goals

outlined in Williams’ employment agreement with First Mercantile,

each of which would have triggered receipt of the five thousand

options, had been met.

     Williams brought suit against Colonial Bank, as successor-in-

interest to First Mercantile, and Colonial Bancgroup, as successor-

in-interest to Mercantile, alleging breach of contract, unjust

enrichment, and promissory estoppel.    On May 17, 2005, Williams

moved for partial summary judgment. Defendants-appellees responded

and moved for summary judgment on June 20, 2005.    Williams filed

his response on June 28, 2005.    The district court ruled on both

motions on August 11, 2005, denying Williams’ motion and granting

the motion brought by defendants-appellees.   Judgment was entered

August 12, 2005, and amended sua sponte on August 22, 2005 to

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correct a clerical error.    On August 26, 2005, Williams filed a

Motion to Alter or Amend Judgment, claiming that the district

court’s ruling did not address his unjust enrichment and promissory

estoppel claims.   The district court overruled Williams’ motion on

September 21, 2005.

                            DISCUSSION

     We review a district court’s grant of summary judgment de

novo.   Garcia v. Lumacorp, Inc., 429 F.3d 549, 553 (5th Cir. 2005).

Summary judgment is appropriate when “the pleadings, depositions,

answers to interrogatories, and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as to

any material fact and that the moving party is entitled to a

judgment as a matter of law.”    FED. R. CIV. P. 56(c).

     Williams contends the district court erred in granting summary

judgment because genuine issues of material fact existed with

respect to whether his employment agreement with First Mercantile

was breached.   He argues that (1) the Colonial entities repudiated

the employment agreement with First Mercantile and that (2) First

Mercantile failed to provide Williams the continuing opportunity to

earn performance-based options.

     The district court did not err in granting summary judgment.

Williams’ employment agreement with First Mercantile did not forbid

a merger, and Colonial Bank’s discussion with Williams regarding

the post-merger terms of employment with Colonial Bank did not

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constitute a repudiation of the First Mercantile agreement.

     Williams also contends that the district court erred in

applying the     doctrine         of   merger    to   hold   that   his    employment

agreement with Colonial Bank superseded his agreement with First

Mercantile.     Again, we disagree.             Under the “doctrine of merger,”

a prior contract is absorbed into a subsequent one when “the same

parties    to   an    earlier      agreement     later   enter      into   a   written

integrated agreement covering the same subject matter.”                        Fish v.

Tandy Corp., 948 S.W.2d 886, 898 (Tex. App.—Fort Worth 1997, writ

denied).    Thus, where the parties and subject matter are the same,

and ambiguity, fraud, accident, or mistake is neither pleaded nor

proven, “a written instrument presumes that all prior agreements of

the parties relating to the transaction have been merged into the

written instrument.”             Weinacht v. Phillips Coal Co., 673 S.W.2d

677, 679 (Tex. App.—Dallas 1984, no writ).                    The merger doctrine

triggers the parol evidence rule, precluding enforcement of prior

agreements.     Tri-Steel Structures, Inc. v. Baptist Found. of Tex.,

166 S.W.3d 443, 451 (Tex. App.—Fort Worth 2005, pet. denied).                      The

parol evidence rule is “particularly applicable” where there is an

integration clause such as that included in Williams’ employment

agreement with Colonial Bank.            See Boy Scouts of Am. v. Responsive

Terminal Sys., Inc., 790 S.W.2d 738, 745 (Tex. App.—Dallas 1990,

writ denied).

     Williams        has   not    pleaded   ambiguity,       fraud,   accident,     or

                                            5
mistake.   Rather, he claims the parties and subject matter of the

two employment agreements differ.       As the district court made

clear, however, these arguments must fail:

     “He first contends the [employment agreement] was not
     between the same parties as his prior agreement. Once
     again, Plaintiff has failed to consider the language in
     the Agreement of Merger which deems the ‘Resulting Bank
     . . . the same corporation as [First Mercantile] and
     Colonial [Bank].’     Clearly, the Defendants sought to
     place Colonial Bank into the shoes of First Mercantile in
     executing a merger agreement including this language.
     Accordingly, for the purposes of the [employment
     agreement], Colonial Bank and First Mercantile must be
     considered equivalent entities.
           Second,   Williams,    contends    the   [employment
     agreement] did not involve the same subject matter as his
     prior agreement.      Plaintiff characterizes his prior
     agreement as relating to his employment and options prior
     to the merger.       According to him, the [employment
     agreement] governed his post-merger employment and made
     promises of future discretionary grants of Colonial
     Bancgroup stock options. Thus, Williams concludes the
     two agreements addressed wholly separate employment
     arrangements and stock options.
           The Court declines to adopt such a narrow reading of
     the two agreements. It is clear the subject matter of
     te to areet ivle te trs o Wlim’ epomn a te Peiet o te Asi bac. Te
      h w gemns novd h em f ilas mlyet s h rsdn f h utn rnh h
differences in the terms of Plaintiff’s employment under the two
agreements does not alter the nature, and identity, of the subject
matter.”

The district court correctly applied the merger doctrine to hold

that Williams’ employment agreement with Colonial Bank superseded

his agreement with First Mercantile.

     Finally, plaintiff-appellant argues that the district court

erred in issuing a final judgment because it did not specifically

mention Williams’ unjust enrichment and promissory estoppel claims.

Here, too, we disagree with plaintiff-appellant. Having ruled that

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Williams’ employment agreement with Colonial Bank superseded that

which   he   entered     with   First   Mercantile,       the   district    court

correctly issued a final judgment.          Williams did not allege in his

motion to alter or amend the judgment (or in any of his other

filings below), and he has not asserted on appeal, any facts

extraneous to those the district court considered that would

support   his   unjust    enrichment     and    promissory      estoppel   claims

notwithstanding     the     correctness        of   the     district       court’s

determination that the employment contract with Colonial Bank

superceded his agreement with First Mercantile.

     The existence of a valid, express contract that covers the

subject matter of the parties’ dispute generally precludes recovery

under a quasi-contract theory.          Fortune Prod. Co. v. Conoco, Inc.,

52 S.W.3d 671, 684 (Tex. 2000). Thus, because an express agreement

has at all times governed the terms of Williams’ employment, he may

not recover in quantum meruit for the services he rendered in

helping to establish the Austin bank branch. See Vortt Exploration

Co. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex. 1990)

(“Generally, a party may recover under quantum meruit only where

there is no express contract covering the services or materials

furnished.”).     He is limited to the compensation outlined in his

employment agreement with Colonial.            See First Union Nat’l Bank v.

Richmont Capital Partners I, L.P., 168 S.W.3d 917, 931 (Tex.

App.—Dallas 2005, no pet.) (noting that, when a relevant contract

                                        7
exists, “there can be no recovery under a quasi-contract theory

because parties should be bound by their express agreements”).

     Similarly, Williams’ promissory estoppel claim must fail. See

Doctors Hosp. 1997, L.P. v. Sambuca Houston, L.P., 154 S.W.3d 634,

636 (Tex. App.—Houston [14th Dist.] 2004, pet. abated) (stating

that “promissory estoppel becomes available to a claimant only in

the absence of a valid and enforceable contract”).               Had Williams

alleged   a   promise   independent       of   the   contract,   a   promissory

estoppel claim might have been sustainable.            See Richter v. Wagner

Oil Co., 90 S.W.3d 890, 899 (Tex. App.—San Antonio 2002, no pet.).

As Williams alleges the facts, he was clearly told he would not

receive incentive-based options under Colonial Bank.                    In his

Opposition to Defendants’ Motion for Summary Judgment, Williams

stated:

     “Mr. Williams raised the issue of his 10,000 ungranted
     incentive options prior to the merger, and continued to
     raise the issue with both Mercantile and, following the
     merger, Colonial.      Colonial consistently took the
     position that the options were extinguished in the
     merger, and that they had no continuing liability under
     the Mercantile agreement. In addition, Roy Salley, the
     president of Mercantile and president of Colonial’s Texas
     region following the merger, took this position during
     conversations with Mr. Williams.”

In short, according to plaintiff-appellant’s own version of the

facts, there was no promise upon which Williams could have relied

to support a promissory estoppel claim.

     Although the unjust enrichment and promissory estoppel claims

were not specifically named, the district court clearly included

                                      8
them in its August 11, 2005 summary judgment order stating that

“Defendants are entitled to summary judgment on all claims against

them.”   In its August 22, 2003 Rule 58(a) judgment the court

“ORDERED, ADJUDGED, and DECREED that the plaintiff Donnie Williams

TAKE NOTHING in this cause against defendants . . . and that all

costs of suit are taxed against the plaintiff, for which let

execution issue.”   And, in its order overruling Williams’s Motion

to Alter or Amend Judgment, the court stated:

     “Williams well knew the defendants were seeking a summary
     judgment regarding all issues. . . . Williams filed a
     Motion to Alter or Amend Judgment contending the Court
     did not address or rule ‘upon plaintiff’s claims of
     unjust enrichment and promissory estoppel, neither of
     which were placed before the Court for decision.’ This
     statement is completely inaccurate.       The defendants
     placed all issues for summary judgment on its behalf
     before the Court and Williams in its response to the
     summary judgment and in the Motion to Alter or Amend
     Judgment cites no evidentiary record before the Court
     which would establish any factual issue regarding
     theories of unjust enrichment and promissory estoppel.
     The defendants sought summary judgment, filed an
     evidentiary record, and the Court granted the same based
     on the evidentiary record before the Court.”

The district court unambiguously manifested its intention to, and

in fact did, dispose of all of Williams’s claims.2

     2
      Williams relies on Stillman v. Travelers Ins. Co., 88 F.3d
911 (11th Cir. 1996), in which the Eleventh Circuit held that the
district court erred in granting a summary final judgment because
a list of alternative affirmative defenses had not been
addressed. Id. at 912. In that case, the motion for summary
judgment that formed the basis for the final judgment set forth
facts that addressed (and rejected) only one affirmative defense.
Id. Consequently, the district court’s holding on the single
affirmative defense did not permit the conclusion that the
plaintiff’s claims were correct as a matter of law. Id. at 913

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                           CONCLUSION

     The judgment of the district court is

                            AFFIRMED.

n.2. Conversely, in the instant case, the district court’s
determination that Williams’ employment agreement with Colonial
superseded his employment agreement with First Mercantile
provides a basis for dismissing Williams’ unjust enrichment and
promissory estoppel claims.

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