OPINION
Plaintiff Harry W. Applegate, Inc. brings a diversity action for breach of contract against Defendant Stature Electric, Inc. (“Stature”), alleging failure to pay
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commissions on orders solicited by the Plaintiff and placed both prior and subsequent to its termination. Because the governing state law provides for the payment of commissions on specific orders placed prior to termination,
see McCaskey v. Cumberland Glass Mfg. Co.,
The Plaintiff works as a sales representative, soliciting orders on behalf of manufacturers. In 1979, the Plaintiff began selling for Stature under an oral arrangement, and the parties subsequently entered into a written contract in May, 1994. Under the Agreement, the Plaintiff was granted the exclusive right to solicit orders for Stature’s fractional horsepower electric motors within a certain geographic area in exchange for commissions of five percent. The Agreement further provided that “Commissions shall be deemed earned by [Plaintiff] upon payment for products to [Stature].” On May 8, 1998, Stature terminated its relationship with the Plaintiff pursuant to the terms of the Agreement.
At issue in this case is whether Plaintiff is entitled to commissions for goods paid for after termination, but released under blanket purchase orders that were procured by Plaintiff and in place prior to termination. These blanket purchase orders did not obligate a customer to buy or Stature to sell any specific quantity of goods, but simply established the terms for the particular motors from time to time ordered by the customer and released by Stature. Stature was free to terminate a blanket purchase order at will.
The district court held that as a matter of law the contract terms provided that the commission was not “earned” until the order was paid for, and as a result granted the Defendant’s motion for summary judgment. In addition, the district court denied Plaintiffs motion to file an amended complaint adding an unjust enrichment claim.
On appeal, we review a district court’s grant of summary judgment
de novo. J.Z.G. Resources v. Shelby Ins. Co.,
There are three potential situations at issue here: (1) the goods were ordered before termination and paid for before termination, (2) the goods were ordered before, but paid for after termination, and (3) the goods were both ordered and paid for after termination. The first situation has been settled by the parties with the Plaintiff reimbursed by the Defendant.
Under the second situation, the Plaintiff is entitled to commissions upon all orders obtained by it and accepted by the Defendant, and upon which shipments or payments were made after Plaintiff left Defendant’s employ, in the absence of any agreement to the contrary.
McCaskey v. Cumberland Glass Mfg. Co.,
The language of the Agreement provides for payment of commissions to the Plaintiff after the Defendant has received payment, but is ambiguous as to whether the Plaintiffs right to receive commissions on placed specific orders is cut off by termination because the Defendant has not received payment. Because the Agreement does not clearly provide a contrary provision, we must follow New York law. As a result, the Plaintiff is entitled to commissions on specific orders for goods placed prior to May 8, 1998. Because there is no evidence in the record as to the date or amount of specific orders, we remand the case to the district court for an evidentiary determination.
The third situation applies to goods ordered pursuant to the blanket purchase orders solicited by the Plaintiff under which specific orders for goods were placed on multiple occasions after termination. Contrary to Plaintiffs assertions, we find that the actions of the parties reveal an intent to prohibit commissions on specific orders placed after termination. Because the contract is ambiguous, we look to the conduct of the parties to determine their intent.
Sayers v. Rochester Telephone Corp. Supplemental Management Pension Plan,
In 1983, the Plaintiff proposed that the parties amend their oral agreement to include the awarding of commissions for a one year duration after termination. This amendment was rejected by the Defendant, and was not adopted in 1994 when the parties entered the governing written agreement. Because commissions on post termination orders were considered and rejected, we interpret the ambiguity in the contract in favor of the Defendant. Here, Plaintiff was on notice that the contract did not provide for such post termination commissions based on the parties prior negotiations, and therefore should not have had any expectation of receiving such commissions. Lastly, although Plaintiff did not raise it, it would be foreclosed from recovering under a “procuring cause” theory because that theory does not apply to sales representative agreements.
See UWC, Inc. v. Eagle Industries, Inc.,
Finally, Plaintiff claims that the district court erred in failing to provide it leave to amend its complaint to add an unjust enrichment claim. Because we read the contract to foreclose post termination commissions based on the prior actions of the parties, we find that the district court did not err. Under New York law, the existence of a valid and written contract governing a particular subject matter precludes recovery in quasi contract for events concerning the same subject matter.
Clark-Fitzpatrick, Inc. v. Long Island Rail Road Co.,
Thus, we REVERSE the district court to the extent that it prohibited commissions for specific orders placed prior to termination, we AFFIRM the district court’s decision to deny Plaintiff leave to amend its complaint, and we REMAND *490 for a determination of the amount owed to Plaintiff in commissions for specific orders placed prior to its termination.