NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule 23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28, as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
COMMONWEALTH OF MASSACHUSETTS
APPEALS COURT
23-P-476
ALAN SMITH
vs.
DECISIONONE CORPORATION.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
The defendant, DecisionOne Corporation, appeals from a
judgment issued after remand from a panel of this Court
concerning the damages it owes to the plaintiff, Alan Smith, for
unpaid commissions. The remand order required the recalculation
of the plaintiff's damages to account for the effect of the
defendant's FY2013 commission plan. See Smith v. DecisionOne
Corp., 98 Mass. App. Ct. 1106 (2020). The defendant argues that
the judge's decision after remand misapplied the FY2013 plan and
violated the panel's remand order, overpaid the plaintiff for
commissions due under the FY2010 plan, and wrongly awarded him
bonuses under the FY2010 plan. We affirm with a modification.
Discussion. 1. Effect of FY2013 plan. The parties agree
that from April 1, 2012, the effective date of the FY2013 plan,
to September 5, 2012, the last day of the plaintiff's employment, the defendant received revenues totaling
$4,312,806.10 from accounts that the plaintiff had acquired for
the defendant prior to April 1, 2012, when the FY2010 plan was
in effect. The parties stipulated that the plaintiff did not
qualify for any commissions under the FY2013 plan; however, they
disagree about the effect of that stipulation. According to the
plaintiff, he was not entitled to any commissions under the
FY2013 plan because it allowed commissions only for new business
acquired after the effective date, and he did not generate any
revenue that qualified. Nonetheless, he contended that he was
eligible to receive commissions under the FY2010 plan
attributable to accounts opened while the FY2010 plan was in
effect, even if the revenues were received after the FY2013 plan
went into effect. According to the defendant, not only did the
plaintiff fail to acquire new business under the FY2013 plan,
but once the FY2013 plan went into effect, it also made the
plaintiff ineligible for commissions based on revenue received
after April 1, 2012, attributable to accounts that he had
acquired under the FY2010 plan. The judge agreed with the
plaintiff.
The judge's determination was properly based on his
interpretation of the terms of the FY2013 plan, construed in
light of evidence of the parties' past practices. "The
interpretation of a contract presents a question of law for the
2 court, except to the extent disputed facts bear upon such
interpretation." USM Corp. v. Arthur D. Little Sys., Inc., 28
Mass. App. Ct. 108, 116 (1989). "Extrinsic evidence bearing
upon the background and purpose of the parties, as well as their
understanding of the meaning of particular language used in the
contract, may be considered both in the construction of
ambiguous contract language and in resolving uncertainties in
applying the terms of the written contract to the subject
matter." Id. The interpretation of an unambiguous contract is
a question of law, but the interpretation of the parties' intent
with respect to terms that are "ambiguous, uncertain, or
equivocal in meaning" is a question of fact. Seaco Ins. Co. v.
Barbosa, 435 Mass. 772, 779 (2002).
Based on the language of the FY2013 plan, the judge
observed that it applied only to "new business revenue," which
was defined as "the revenue generated for services that are not
already under contract, or a project or service that is not
already under contract at a specific value." Thus, the FY2013
plan did not affect the commissions owed under the FY2010 plan
for previously existing accounts. The defendant argues that the
judge violated basic principles of contract interpretation by
failing to give effect to every word and provision and finding
ambiguity where there was none. See DeWolfe v. Hingham Ctr.,
Ltd., 464 Mass. 795, 804 (2013); Freelander v. G. & K. Realty
3 Corp., 357 Mass. 512, 516 (1970). Specifically, the defendant
points to language under the heading "Effective Date," which
states that the FY2013 plan is effective from April 1, 2012, to
March 31, 2013, and "supersedes all previous written or verbal
plans." According to the defendant, this language means that
any revenue from the plaintiff's accounts received after April
1, 2012, must be allocated to the plaintiff's quota associated
with the FY2013 plan.
We agree with the judge that the effective date and
"superseding" language does not unequivocally settle the issue;
therefore, the judge properly considered evidence of the
parties' intent. Based on the testimony of the defendant's sole
witness at the remand trial, its general counsel Sandra Ross,
the judge found that the defendant's settled practice was that
commissions generated under a prior year's plan would be paid
according to that plan for at least the twelve-month period in
which the revenues were received, even if a new plan went into
effect in the interim. The evidence fully supports this finding
and resolves any ambiguity in the plaintiff's favor. We do not
consider the judge's construction or application of the FY2013
plan in any way to disregard or violate the remand order. Nor
does this interpretation permit the plaintiff to earn
commissions on the same revenue under two different plans, as
the defendant contends.
4 2. Commissions earned under the FY2010 plan. The
defendant claims that the judge erred in calculating commissions
owned under the 2010 plan. In addition to its assertion that
the judge should not have considered the revenues received from
the plaintiff's accounts after April 1, 2012, the defendant
contends that commissions are paid for only one year after the
first sale attributed to a new account; after one year, however,
the salesperson is no longer eligible for commissions from that
account, even if it continues to generate revenues. The
defendant goes so far as to assert, in a new calculation
prepared for the remand hearing, that it overpaid the plaintiff
by about $60,000.
The judge gave five reasons for rejecting the contention
that commissions were earned for only one year. Limiting our
discussion to the arguments raised in the defendant's brief, we
agree with the judge that the FY2010 plan has no unambiguous
language limiting commissions to a one-year period, and that
both the parties' practices and the drafting history support
that conclusion. We also agree with the judge's rejection of
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NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule 23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28, as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
COMMONWEALTH OF MASSACHUSETTS
APPEALS COURT
23-P-476
ALAN SMITH
vs.
DECISIONONE CORPORATION.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
The defendant, DecisionOne Corporation, appeals from a
judgment issued after remand from a panel of this Court
concerning the damages it owes to the plaintiff, Alan Smith, for
unpaid commissions. The remand order required the recalculation
of the plaintiff's damages to account for the effect of the
defendant's FY2013 commission plan. See Smith v. DecisionOne
Corp., 98 Mass. App. Ct. 1106 (2020). The defendant argues that
the judge's decision after remand misapplied the FY2013 plan and
violated the panel's remand order, overpaid the plaintiff for
commissions due under the FY2010 plan, and wrongly awarded him
bonuses under the FY2010 plan. We affirm with a modification.
Discussion. 1. Effect of FY2013 plan. The parties agree
that from April 1, 2012, the effective date of the FY2013 plan,
to September 5, 2012, the last day of the plaintiff's employment, the defendant received revenues totaling
$4,312,806.10 from accounts that the plaintiff had acquired for
the defendant prior to April 1, 2012, when the FY2010 plan was
in effect. The parties stipulated that the plaintiff did not
qualify for any commissions under the FY2013 plan; however, they
disagree about the effect of that stipulation. According to the
plaintiff, he was not entitled to any commissions under the
FY2013 plan because it allowed commissions only for new business
acquired after the effective date, and he did not generate any
revenue that qualified. Nonetheless, he contended that he was
eligible to receive commissions under the FY2010 plan
attributable to accounts opened while the FY2010 plan was in
effect, even if the revenues were received after the FY2013 plan
went into effect. According to the defendant, not only did the
plaintiff fail to acquire new business under the FY2013 plan,
but once the FY2013 plan went into effect, it also made the
plaintiff ineligible for commissions based on revenue received
after April 1, 2012, attributable to accounts that he had
acquired under the FY2010 plan. The judge agreed with the
plaintiff.
The judge's determination was properly based on his
interpretation of the terms of the FY2013 plan, construed in
light of evidence of the parties' past practices. "The
interpretation of a contract presents a question of law for the
2 court, except to the extent disputed facts bear upon such
interpretation." USM Corp. v. Arthur D. Little Sys., Inc., 28
Mass. App. Ct. 108, 116 (1989). "Extrinsic evidence bearing
upon the background and purpose of the parties, as well as their
understanding of the meaning of particular language used in the
contract, may be considered both in the construction of
ambiguous contract language and in resolving uncertainties in
applying the terms of the written contract to the subject
matter." Id. The interpretation of an unambiguous contract is
a question of law, but the interpretation of the parties' intent
with respect to terms that are "ambiguous, uncertain, or
equivocal in meaning" is a question of fact. Seaco Ins. Co. v.
Barbosa, 435 Mass. 772, 779 (2002).
Based on the language of the FY2013 plan, the judge
observed that it applied only to "new business revenue," which
was defined as "the revenue generated for services that are not
already under contract, or a project or service that is not
already under contract at a specific value." Thus, the FY2013
plan did not affect the commissions owed under the FY2010 plan
for previously existing accounts. The defendant argues that the
judge violated basic principles of contract interpretation by
failing to give effect to every word and provision and finding
ambiguity where there was none. See DeWolfe v. Hingham Ctr.,
Ltd., 464 Mass. 795, 804 (2013); Freelander v. G. & K. Realty
3 Corp., 357 Mass. 512, 516 (1970). Specifically, the defendant
points to language under the heading "Effective Date," which
states that the FY2013 plan is effective from April 1, 2012, to
March 31, 2013, and "supersedes all previous written or verbal
plans." According to the defendant, this language means that
any revenue from the plaintiff's accounts received after April
1, 2012, must be allocated to the plaintiff's quota associated
with the FY2013 plan.
We agree with the judge that the effective date and
"superseding" language does not unequivocally settle the issue;
therefore, the judge properly considered evidence of the
parties' intent. Based on the testimony of the defendant's sole
witness at the remand trial, its general counsel Sandra Ross,
the judge found that the defendant's settled practice was that
commissions generated under a prior year's plan would be paid
according to that plan for at least the twelve-month period in
which the revenues were received, even if a new plan went into
effect in the interim. The evidence fully supports this finding
and resolves any ambiguity in the plaintiff's favor. We do not
consider the judge's construction or application of the FY2013
plan in any way to disregard or violate the remand order. Nor
does this interpretation permit the plaintiff to earn
commissions on the same revenue under two different plans, as
the defendant contends.
4 2. Commissions earned under the FY2010 plan. The
defendant claims that the judge erred in calculating commissions
owned under the 2010 plan. In addition to its assertion that
the judge should not have considered the revenues received from
the plaintiff's accounts after April 1, 2012, the defendant
contends that commissions are paid for only one year after the
first sale attributed to a new account; after one year, however,
the salesperson is no longer eligible for commissions from that
account, even if it continues to generate revenues. The
defendant goes so far as to assert, in a new calculation
prepared for the remand hearing, that it overpaid the plaintiff
by about $60,000.
The judge gave five reasons for rejecting the contention
that commissions were earned for only one year. Limiting our
discussion to the arguments raised in the defendant's brief, we
agree with the judge that the FY2010 plan has no unambiguous
language limiting commissions to a one-year period, and that
both the parties' practices and the drafting history support
that conclusion. We also agree with the judge's rejection of
the defendant's claim that it, through its "Administrators," is
the sole arbiter and interpreter of what the plan means. The
defendant offered no evidence of any "decisions, determinations
[or] interpretations" made by any Administrator of the FY2010
plan. As the judge pointed out, Ross was not an Administrator
5 as defined by the plan, and her "post-remand assertions" did not
reflect the exercise of any power of the plan's Administrators,
but were merely legal opinions.
In addition, the defendant argues that the judge erred by
awarding the plaintiff commissions on what the defendant
characterized at the remand trial as "ineligible" and "non-
designated" revenues. In a chalk created by Ross for trial
purposes, the defendant allocated certain revenue streams
previously credited to the plaintiff in these categories and
omitted them from its commission calculation.1 The judge
discredited the defendant's methodology and Ross's testimony,
which he found to be different from the methodology the
defendant used when the plaintiff was an employee. Likewise,
the judge discredited the plaintiff's inflated claim of unpaid
commissions. The judge's credibility determinations are
entitled to deference, and we do not set them aside unless
clearly erroneous. See Brandao v. DoCanto, 80 Mass. App. Ct.
151, 155-156 (2011); Rood v. Newberg, 48 Mass. App. Ct. 185, 191
(1999). Except in one minor respect, the judge's calculation of
commissions under the FY2010 plan is not clearly erroneous.
1 While the data underlying Ross's calculations may have been supported by business records, Ross's summary and color- coding of Exhibit 72, prepared after the fact for trial purposes, do not qualify as business records. See Mass. G. Evid. § 803(6)(A) (2023).
6 We do agree with the defendant that the judge made a clear
error in adding the revenue for calendar year 2012 -- coming up
with a sum of $7,489,466.41 instead of $7,484,466.41 -- which
resulted in awarding the plaintiff an extra $133.34 in
commissions.2 The judgment should be reduced by that amount.
3. Bonuses. Finally, the defendant argues that the judge
erred in crediting the plaintiff's testimony and finding that he
was owed $17,500 in unpaid bonuses. Based primarily on the
defendant's treatment of the Sears/Kmart, Best Buy, and Hilton
accounts in its business records, the judge rejected the
defendant's argument that the extension of the IBM account to
these new end users did not qualify as new accounts. We discern
no error of law or clear error of fact in the judge's
determination that the plaintiff was entitled to bonuses for
those three accounts.
Conclusion. The judgment is modified to reflect that the
plaintiff is entitled to damages in the amount of $166,051.44,
together with statutory costs and interest at the rate of twelve
2 Accordingly, the judge should have multiplied $4,484,466.41 by the commission rate of .02667, resulting in a product of $119,600.72 instead of $119,734.06 -- a difference of $133.34.
7 percent per annum from the date of the breach of contract,
October 31, 2012, and as so modified, the judgment is affirmed.
So ordered.
By the Court (Vuono, Massing & Toone, JJ.3),
Assistant Clerk
Entered: April 18, 2024.
3 The panelists are listed in order of seniority.