580 F. App'x 408
6th Cir.2014Background
- Aidamark, a Michigan sales representative, had an exclusive sales-rep agreement (2003) with Roll Forming Corp. (RFC) entitling Aidamark to 5% commission on "net billed sales" of products sold in its territory that were "shipped by" RFC; Paragraph 6 stated commissions are "earned on the date of payment by the customer."
- Addendum (2008) assigned specific accounts to Aidamark, including Steelcase and Interkal; RFC later entered multi‑year supply agreements with those customers (Answer JT with Steelcase, ongoing arrangements with Interkal).
- Interkal terminated RFC in May 2011 but agreed to six months of continued ordering; RFC terminated the Aidamark agreement on June 2, 2011.
- RFC issued a commission statement (Aug. 31, 2011) paying $26,529.90 for commissions on invoices paid by customers; it listed about $49,227.38 as unpaid because customers had not paid before termination; RFC paid the $26,529.90 on Sept. 29, 2011.
- Aidamark sued for unpaid commissions (including commissions on Steelcase and Interkal business), breach of contract, MSRA violations, accounting, and declaratory relief; district court granted summary judgment for RFC, and Aidamark appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Steelcase/Interkal contracts were "sales" entitling Aidamark to commissions (requirements-contract theory) | Contracts created sales when formed, so commissions were due regardless of payment | Even if requirements contracts, Aidamark's commissions are defined by its agreement with RFC and limited to billed, shipped, and paid sales | Court: Even assuming requirements contracts, Agreement limits commissions to net billed sales paid by customers; requirements-contract status does not alter that rule. |
| Whether commissions were "earned" before customer payment (interpretation of Paragraph 6) | "Earned" means commission event occurred before payment; Paragraph 6 governs timing of payment, not earning | Paragraph 6 creates a condition precedent: commissions are earned only upon customer payment | Court: Paragraph 6 unambiguously makes customer payment the condition precedent to earning commissions; RFC paid all commissions earned before termination. |
| Whether Aidamark is entitled to post-termination commissions under procuring-cause doctrine | Aidamark procured the customer contracts (Steelcase/Interkal) and thus should get commissions on future orders | Procuring-cause does not override the Agreement's definition of earned sales; Aidamark produced no evidence it procured individual paid orders | Court: Procuring-cause doctrine applies where contract is silent on post-termination commissions but Aidamark failed to show it was procuring cause of any individual sales for which payment was due to RFC. |
Key Cases Cited
- Hawkins v. Anheuser-Busch, Inc., 517 F.3d 321 (6th Cir.) (summary-judgment standard review)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S.) (summary-judgment principles)
- Precision Rubber Prods. Corp. v. George McCarthy, Inc., 872 F.2d 187 (6th Cir.) (interpreting post-termination commission language)
- Miller-Davis Co. v. Ahrens Constr., Inc., 848 N.W.2d 95 (Mich.) (elements of breach of contract and contract interpretation rules)