398 P.3d 165
Idaho2017Background
- Bret Kunz (agent) signed a 2009 subcontractor agent agreement with Nield, Inc. (N.I.) governing commissions, responsibilities, and an ownership provision stating the agent would own 50% of the book of business.
- Dispute arose whether the 2009 Contract entitled Bret to annual profit‑sharing/contingent commissions (distinct from monthly commissions) and, if so, what split applied.
- Bret previously worked under a similar 1996 contract and received no profit sharing under that arrangement; after his brother Michael’s death Bret purchased Michael’s book and sought a new contract including ownership language.
- N.I. paid Bret several annual payments labeled “profit sharing”; N.I. characterized some payments as bonuses and admitted paying 50% of Gem State profit sharing by course of dealing; Bryan Nield once gave an 80% payment as a one‑time accommodation.
- Bret sued for an accounting and declaratory relief (that the 2009 Contract included profit sharing and that Bret’s share was 80%), N.I. counterclaimed (later dismissed), and the district court held after a bench trial that the 2009 Contract did not include profit sharing (except an implied 50/50 split for Gem State by course of dealing) and some payments were gratuitous bonuses.
- The Supreme Court of Idaho affirmed: it construed ambiguous contract terms via extrinsic evidence and course of dealing, upheld the district court’s conclusions, and declined to award appellate fees to either party.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the term "commission" in the 2009 Contract includes annual profit sharing | Kunz: "commission" includes profit sharing; course of dealing and Bryan’s contemporaneous comments support that meaning | N.I.: "commission" refers to monthly premium commissions; profit sharing is distinct and paid annually | Court: "commission" ambiguous; applying Bosen factors, limited to monthly commissions and does not include profit sharing |
| Whether phrase "other functions" covers profit sharing | Kunz: "other functions" should encompass profit sharing; avoiding surplusage supports this reading | N.I.: phrase signals additional unexpressed duties/individual agreements, not profit sharing | Court: ambiguity resolved against including profit sharing; phrase not reasonably read to include profit sharing |
| Whether payments labeled "profit sharing" were enforceable or gratuitous bonuses | Kunz: payments were profit sharing owed under contract/practice | N.I.: payments were discretionary bonuses; no enforceable profit sharing obligation | Court: payments (except Gem State arrangement) were gratuitous bonuses; no enforceable right to profit sharing under contract |
| Whether Gem State profit sharing was subject to 80/20 or 50/50 split | Kunz: any profit share should follow 80/20 commission split in 2009 Contract | N.I.: Gem State was governed by an individual/implied agreement and split by ownership | Court: parties’ course of dealing established an implied-in-fact Gem State agreement split 50/50 (ownership basis); appellate court will not consider N.I.’s attempt to overturn that finding for lack of cross-appeal |
Key Cases Cited
- Pocatello Hosp., LLC v. Quail Ridge Med. Investor, LLC, 156 Idaho 709 (appellate standard for bench trial findings and review)
- Swanson v. Beco Constr. Co., Inc., 145 Idaho 59 (ambiguity is question of law; use extrinsic evidence to determine parties’ intent)
- J.R. Simplot Co. v. Bosen, 144 Idaho 611 (factors for interpreting ambiguous contract language and excluding subjective undisclosed intent)
- Brown v. Greenheart, 157 Idaho 156 (definition of ambiguous contract term)
- Johnson Cattle Co. v. Idaho First Nat’l Bank, 110 Idaho 604 (pre-contract oral statements may be admissible to resolve ambiguity when constituting an agreement)
- Kantor v. Kantor, 160 Idaho 810 (courts will not rewrite contracts for equity; limits on equitable relief)
- Sinclair Mktg., Inc. v. Siepert, 107 Idaho 1000 (resolve ambiguity against drafter only if intent cannot be ascertained by other evidence)
- Asbury Park, LLC v. Greenbriar Estate Homeowners’ Ass’n, Inc., 152 Idaho 338 (attorney fee determination deferred where judgment is partial under Rule 54(b))