Court Opinion

ID: 1027960
Source: CourtListenerOpinion
Date Created: 2013-07-05 07:32:58.40226+00
Date Added: 2024-06-11T12:29:55.474749
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 08-1240

EDWIN A. SHERIDAN, Executor of Estate of Michael Kirkland
Casey,

                Plaintiff – Appellant,

           v.

NATIONWIDE RETIREMENT SOLUTIONS, INCORPORATED,

                Defendant – Appellee.

Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.    Claude M. Hilton, Senior
District Judge. (1:07-cv-00286-CMH-TRJ)

Argued:   January 27, 2009                 Decided:   February 25, 2009

Before NIEMEYER, TRAXLER, and SHEDD, Circuit Judges.

Vacated and remanded by unpublished per curiam opinion.

ARGUED: Brien Anthony Roche, JOHNSON & ROCHE, McLean, Virginia,
for Appellant.   Christopher Landau, KIRKLAND & ELLIS, L.L.P.,
Washington, D.C., for Appellee.   ON BRIEF: Daniel T. Donovan,
Joseph Cascio, KIRKLAND & ELLIS, L.L.P., Washington, D.C., for
Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

       Edwin Sheridan, as the executor of the Estate of Michael

Kirkland Casey, brought this breach of contract action against

Nationwide         Retirement          Solutions,      Inc.        On     cross-motions         for

summary          judgment,       the        parties    argued          that   the    underlying

contract is unambiguous, the material facts are not in dispute,

and    the       case    could    be    decided       in   their        respective    favor      on

summary judgment.                J.A. 440.            In this posture, the district

court granted Nationwide’s motion and denied Sheridan’s motion.

Sheridan now appeals.                 On appeal, the parties continue to assert

that       the    contract       is    unambiguous         and    the     facts     are   not    in

dispute,         but     they    nonetheless          vigorously         disagree     over      the

meaning of the underlying contract.                          Because we find that the

contract is ambiguous, we vacate the summary judgment in favor

of Nationwide and remand for further proceedings. 1

                                                  I

       Summary          judgment       is    appropriate         “if    the   pleadings,        the

discovery and disclosure materials on file, and any affidavits

       1
      We note that (1) the district court also ruled on other
claims below and (2) Sheridan also appeals from an order denying
his motion to set aside the summary judgment.       However, the
other claims are not before us on appeal, and our analysis of
Sheridan’s appeal of the order denying his motion to set aside
the summary judgment is substantially the same as our analysis
of his appeal of the summary judgment.

                                                  2
show that there is no genuine issue as to any material fact and

that the movant is entitled to judgment as a matter of law.”

Fed.   R.   Civ.    P.    56(c).     The       relevant    inquiry   in     a    summary

judgment analysis is “whether the evidence presents a sufficient

disagreement to require submission to a jury or whether it is so

one-sided    that     one   party   must       prevail    as   a   matter       of   law.”

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986).

We review the district court’s order granting summary judgment

de novo.       Jennings v. U.N.C., 482 F.3d 686, 694 (4th Cir.) (en

banc), cert. denied, 128 S. Ct. 247 (2007).                        In doing so, we

generally must view all facts and draw all reasonable inferences

in the light most favorable to the nonmoving party.                             Scott v.

Harris, 127 S. Ct. 1769, 1774 (2007).                     However, “facts must be

viewed in the light most favorable to the nonmoving party only

if there is a ‘genuine’ dispute as to those facts.”                       Id. at 1776

(quoting Fed. R. Civ. P. 56(c)).

       As noted, both parties moved for summary judgment.                            “When

faced with cross-motions for summary judgment, the court must

review each motion separately on its own merits to determine

whether either of the parties deserves judgment as a matter of

law,” and in considering each motion “the court must take care

to   resolve    all      factual   disputes      and   any     competing,       rational

inferences in the light most favorable to the party opposing

that motion.”         Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th

                                           3
Cir. 2003) (citations and quotation marks omitted).                              The fact

that     both       sides     moved      for     summary          judgment       “neither

establish[es]        the    propriety    of     deciding      a    case     on    summary

judgment,     nor    establish[es]       that    there   is       no     issue   of   fact

requiring     that    summary       judgment    be   granted        to     one   side    or

another.”       Continental Air., Inc. v. United Air., Inc., 277 F.3d
499,   511    n.7    (4th    Cir.   2002)     (citations   and         quotation      marks

omitted).

       We    have    noted     that     “[a]    court    faces         a   conceptually

difficult task in deciding whether to grant summary judgment on

a matter of contract interpretation.”                    Washington Metro. Area

Transit Auth. v. Potomac Invest. Props., Inc., 476 F.3d 231, 235

(4th Cir. 2007) (quoting Goodman v. R.T.C., 7 F.3d 1123, 1126

(4th Cir. 1993)).          Elaborating on this point, we explained:

       Only an unambiguous writing justifies summary judgment
       without resort to extrinsic evidence, and no writing
       is unambiguous if susceptible to two reasonable
       interpretations. The first step for a court asked to
       grant    summary   judgment  based    on  a    contract’s
       interpretation is, therefore, to determine whether, as
       a matter of law, the contract is ambiguous or
       unambiguous on its face.         If a court properly
       determines that the contract is unambiguous on the
       dispositive issue, it may then properly interpret the
       contract as a matter of law and grant summary judgment
       because no interpretive facts are in genuine issue.
       Even where a court, however, determines as a matter of
       law that the contract is ambiguous, it may yet examine
       evidence extrinsic to the contract that is included in
       the summary judgment materials, and, if the evidence
       is,   as    a  matter   of  law,   dispositive   of   the
       interpretative issue, grant summary judgment on that
       basis.    If, however, resort to extrinsic evidence in

                                            4
      the summary judgment materials leaves genuine issues
      of    fact    respecting    the    contract’s    proper
      interpretation, summary judgment must of course be
      refused and interpretation left to the trier of fact.

Id.   (quoting    Goodman,   7    F.3d    at    1126).        In    short,    summary

judgment is only appropriate “when the contract in question is

unambiguous or when an ambiguity can be definitively resolved by

reference to extrinsic evidence.”             Id. 2

                                         II

      The underlying material facts, which are not disputed by

the parties, tend to establish that in October 1981, the City of

Chicago,   Illinois,   appointed     Nationwide’s            predecessor 3     as    the

exclusive coordinator, administrator, and marketer of the City’s

deferred     compensation    plan.        Under       this    plan,     participants

contribute    a   portion    of   their       compensation      in      the   form   of

deferrals or premiums to the plan, which are invested in life

insurance products, annuity products, and/or mutual funds.

      2
      This is a diversity case, and the parties agree that the
contract is governed by Oklahoma substantive law.     However,
“[t]he roles of judge and jury in the interpretation of
contracts are set by federal law, even in diversity cases.”
Cunningham and Co. v. Consolidated Realty Mgt., Inc., 803 F.2d
840, 842 (5th Cir. 1986); see also General Acc. Fire & Life
Assur. Corp., Ltd. v. Akzona Inc., 622 F.2d 90, 93-94 n.5 (4th
Cir. 1980) (discussing the interplay between state substantive
law and Rule 56 in a diversity contract case).
      3
      For ease of reference,             we    will     refer      to   Nationwide’s
predecessor as “Nationwide.”

                                         5
       Because     Casey    was      instrumental    in    helping      secure      the

contract    with     the     City,     Nationwide    entered     into       an    Agent

Agreement with him in February 1982.                  The “Whereas” clause of

the Agent Agreement provides:

       WHEREAS, the parties hereto recognize that certain
       previous oral Agreements and written Memoranda of
       Agreement between the parties have occurred concerning
       the employment of [Casey] and [his] compensation with
       regard to contracts obtained or to be obtained for
       [Nationwide] from the City of Chicago and the parties
       hereto wish and desire to collect all said Agreements
       aforesaid into one final Agreement for [Casey’s]
       compensation.

J.A. 60.        Generally, under the terms of the Agent Agreement,

Casey was to act as a liaison between Nationwide and the City,

and he was to be paid compensation in the form of commissions

calculated as a percentage of the premiums Nationwide collected

from plan participants, either initially or for renewal, under

the 1981 agreement.           Among other things, the Agent Agreement

provides that “[r]enewal commissions on any given policy shall

be fully vested to [Casey] upon acceptance” by the underwriters

and that he “shall be fully vested for any renegotiation of” the

1981   agreement.          J.A.    62-63.       Further,   the   Agent      Agreement

contains    a    “Death      and     Disability”     provision       that        states:

“Commissions shall be deemed to have been earned [by Casey] on

any executed Agreement with City or any other entity referred to

herein and shall be continued to be payable to [Casey’s] Estate

                                            6
as provided herein in the event of his death.”                   J.A. 64.      Casey

died in February 2000.

      In March 1989, Nationwide and the City entered into the

1989 Administrative Services Agreement (“1989 ASA”), under which

Nationwide     was    the    exclusive     coordinator,     administrator,       and

marketer of the City’s deferred compensation plan.                   The 1989 ASA

was   originally      set    to   expire       automatically    in   March     1994.

Thereafter, Nationwide and the City executed nine amendments to

the   1989    ASA.     Several    of     these    amendments    predate     Casey’s

death, including one that set the expiration date of the 1989

ASA for March 2003.           An amendment after Casey’s death extended

the 1989 ASA expiration date beyond March 2003.

      After     Casey’s       death,       Nationwide      continued      to     pay

commissions to his estate.             However, in a December 2002 letter,

Nationwide notified Sheridan that it was exercising its right to

terminate     the    Agent   Agreement.          In   January   2003,   Nationwide

informed Sheridan that the Agent Agreement had terminated by

operation of law on Casey’s death and, therefore, it would not

make any further payments to the estate after March 2003.

                                         III

      The gist of this case is whether Nationwide is obligated by

the Agent Agreement to pay commissions to Casey’s estate after

March 2003.      Purporting to rely on basic principles of contract

                                           7
interpretation, the parties have presented conflicting arguments

as to what they contend is the plain, and only, reading of the

Agent Agreement on this point.

       Generally   speaking,     Nationwide       argues    that       it    is   not

obligated to continue paying commissions to Casey because, in

its view, the Agent Agreement is a “personal services contract”

and,   after   Casey’s    death,      “by   definition     he   was     unable    to

perform any further services, so by definition he could earn no

further commissions.”         Brief of Appellee, at 11.            For support,

Nationwide points to the “Death and Disability” provision of the

Agent Agreement, arguing that under its plain terms “Casey is

deemed to have ‘earned’ commissions for services performed on

contracts    ‘executed’      before   his   death,   but    not    on       contracts

‘executed’     after   his    death.”       Id.   (emphasis       in    original).

Accepting Nationwide’s argument, the district court concluded:

       The plain meaning of the Agent Agreement clearly shows
       that Casey’s estate was entitled to receive only
       commission payments for commissions Casey already
       earned, not to commissions that Casey could not earn
       after his death.     [Nationwide], therefore, properly
       ended its commission payments to Casey’s estate on
       March 29, 2003 - the date when the executed agreement
       in place when Casey passed terminated.

J.A. 446-47.

       Sheridan generally contends that the court erred in making

this determination and that Nationwide is obligated under the

Agent Agreement to pay commissions to Casey’s estate for as long

                                        8
as   Nationwide       has     any       executed       agreement      with     the    City   to

administer a deferred compensation plan.                          In essence, Sheridan

argues   that     the       payments       to    Casey     are     not,       as   Nationwide

contends, simply for the retention of his personal services;

instead,     they      are    also        in    recognition        of    his       significant

contribution to Nationwide in obtaining the 1981 agreement with

the City.       Like Nationwide, Sheridan points to the “Death and

Disability” provision of the Agent Agreement, and he notes that

its language states that Casey’s commissions shall be deemed to

have been earned and payable on “any executed Agreement” between

Nationwide      and     the       City.         J.A.    64.      In      Sheridan’s      view,

Nationwide’s        argument        requires         the      “Death     and       Disability”

provision to be read as if it states that Casey’s commissions

shall be deemed to have been earned and payable on “any executed

Agreement in effect on the date of Casey’s death.”                                   See Brief

of Appellant, at 23.

      As we have noted, the first step for a court presented with

a summary judgment motion based on a contract’s interpretation

is to determine whether, as a matter of law, the contract is

ambiguous    or       unambiguous         on     its     face,     and    a    contract      is

ambiguous       if      it         is      susceptible           to      two       reasonable

interpretations.             We    have    carefully          considered       the    parties’

competing interpretations of the Agent Agreement, as set forth

in their briefs and their oral arguments, and we conclude that

                                                 9
it   is      ambiguous     with     respect          to       the   issue     of   Nationwide’s

obligation to pay commissions to Casey’s estate after 2003.                                   The

parties have presented two seemingly reasonable interpretations

of the Agent Agreement, and we are not persuaded that either

interpretation is compelled as a matter of law by the language

of   the     Agent      Agreement       read    as        a    whole.       Accordingly,      the

district court erred in entering summary judgment in favor of

Nationwide.

        We    note      that    Sheridan       has    presented         extrinsic        evidence

(especially the affidavit of Jay Wilkinson) 4 that supports his

interpretation of the Agent Agreement.                               However, because the

parties’ litigation positions have been that the Agent Agreement

is unambiguous, we decline to decide in the first instance if

the ambiguity in the contract can be definitively resolved by

extrinsic evidence and, consequently, whether either party is

entitled to summary judgment.                   Bearing in mind our determination

that the Agent Agreement itself is ambiguous, the district court

is free on remand to conduct any further proceedings that it

deems      appropriate,         including      further          consideration       of    summary

judgment for either party.                See, e.g., Atalla v. Abdul-Baki, 976
F.2d 189,   195    (4th    Cir.    1992)        (“Because         the    parties    assert

conflicting intentions on the basis of the same language, which

       4
      Jay Wilkinson, as Nationwide’s president, negotiated and
signed the Agent Agreement on Nationwide’s behalf.

                                                10
supports       both   interpretations,      it    is    our    opinion    that    the

contract is ambiguous and that the question of intent raises a

genuine    issue      of   material   fact,      rendering      summary     judgment

inappropriate.        Accordingly, the entry of judgment for Atalla is

reversed, and the case is remanded to the district court for

consideration of additional evidence of intent, if necessary,

and   a   factual     determination   as    to    the   actual     intent    of   the

parties.”).

                                       IV

      Based on the foregoing, we vacate the summary judgment in

favor     of     Nationwide    and    remand      for     further     proceedings

consistent with this opinion.

                                                              VACATED AND REMANDED

                                       11