Opinion
No. CX-01-2174.
Filed August 6, 2002.
Appeal from the District Court, Ramsey County, File No. C3009694.
Garfield E. Smith, (for appellant)
Brian A. Wood, Doreen A. Mohs, (for respondents)
Considered and decided by Hanson, Presiding Judge, Kalitowski, Judge, and Anderson, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
After resigning from his employment, appellant Donald Marson sued respondents Mutual Service Casualty Insurance Company, Mutual Service Life Insurance Company, and Modern Service Insurance Company [collectively, "MSI"] for employment termination benefits he alleged were due him under the written contract between the parties. Marson pled not only a breach of contract, but also unjust enrichment and promissory estoppel. The district court granted summary judgment in favor of MSI and Marson appealed.
Because the district court did not err in ruling on undisputed facts that Marson had breached the contract, thus permitting MSI to withhold termination benefits, we affirm. The district court also did not err in holding that where a valid contract controls the rights of the parties, there is no place for application of the equitable doctrines of unjust enrichment and promissory estoppel.
DECISION
Summary judgment can be entered where there is no genuine issue of material fact and either party is entitled to judgment as a matter of law. Minn.R.Civ.P. 56.03. "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party," no genuine issue of material fact exists. DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn. 1997) (quotation omitted).
Because the construction and effect of an unambiguous contract is a legal question, this court conducts a de novo review. Banbury v. Omnitrition Int'l, Inc., 533 N.W.2d 876, 880 (Minn.App. 1995). A contract is ambiguous only if the written document, by itself, is "reasonably susceptible to more than one meaning." Trondson v. Janikula, 458 N.W.2d 679, 681 (Minn. 1990).
MSI denied Marson his termination benefits based on two clauses in the contract. First, benefits were to be paid upon a "qualified termination," defined as any termination, except one where the agent had "induced or attempted to induce, either directly or indirectly, policyholders to lapse, cancel, or replace any insurance contract in force with [MSI]." Second, MSI was not liable for payment of termination benefits if the agent directly or indirectly acted as an agent for one year within a 25-mile radius of the agent's current place of business. MSI cited a letter that Marson sent upon his resignation to his current MSI policyholders and the fact that he began writing business with other insurers before submitting his resignation, using the same place of business, and continued to do so.
The letter that Marson sent to current policyholders, which he described as an informational letter, rather than a solicitation, states:
[M]y first concern will be to rewrite your business along with 400 other families who have given me their trust for so many years. Myself or my wife will personally contact you to set up a time to discuss and rewrite your insurance with one of our new companies or feel free to call me to set a time that's convenient for you.
This offer to rewrite insurance was not limited to a time period after the end of the current policy period.
The contract terms are straightforward and the only reasonable interpretation of Marson's letter is that Marson made an attempt to solicit current MSI policyholders or induce them to cancel their policies. See DLH, Inc., 566 N.W.2d at 71 (stating that there must be evidence for the jury to reasonably find for the non-moving party).
Marson argues that MSI representatives made certain remarks that led him to believe that the termination benefits were really retirement benefits that would be available to him. Generally, evidence of understandings or negotiations made prior to the signing of an unambiguous written contract is inadmissible for purposes of contradicting or varying the written contract. Apple Valley Red-E-Mix, Inc. v. Mills-Winfield Eng'g Sales, Inc., 436 N.W.2d 121, 123 (Minn.App. 1989), review denied (Minn. Apr. 26, 1989). Parol evidence is admissible only where the contract itself is ambiguous, in order to determine the intent of the parties. Id. This contract, however, is unambiguous, thus parol evidence is not admissible to change or modify the terms of the contract.
Marson also argued that even if he breached the contract, his breach was excused by MSI's anticipatory breach of the contract, occurring when MSI entered into an agreement with another insurer, Country Companies, to assign MSI's agent contracts to MSI Preferred, a new entity to be created some time in the future.
An anticipatory breach of contract occurs when one party to an executory contract, before the performance is due, expressly renounces the same and gives notice that he will not perform it, his adversary, if he so elects, may treat the renouncement as a breach of the contract and at once bring an action for damages. * * *.
* * * *
[T]he refusal to perform must in effect be an unqualified renunciation or repudiation of the contract.
Space Center, Inc. v. 451 Corp., 298 N.W.2d 443, 450 (Minn. 1980) (quotation omitted).
MSI, however, did not repudiate or renounce its duties under the contract; rather, it affirmed that its obligations under the contract would remain unchanged even after assignment to MSI Preferred. Although Marson was contractually forbidden to assign his duties under the contract, there was no prohibition against assignment by MSI in the contract. While the fairness of this arrangement may be open to debate, contractually, the assignment standing alone is not a breach of the contract. See Epland v. Meade Ins. Agency Assocs., 564 N.W.2d 203, 207 (Minn. 1997).
Marson also asks this court to apply the equitable doctrines of unjust enrichment and promissory estoppel. Except in very limited situations, where a valid contract governs the relationship between the parties, these doctrines have no application. See Midwest Sports Mktg., Inc. v. Hillerich Bradsby of Canada, Ltd., 552 N.W.2d 254, 268 (Minn.App. 1996) (holding that party is not entitled to equitable relief or unjust enrichment where rights are governed by a valid contract, unless contract is not full agreement of all details of compensation), review denied (Minn. Sept. 20, 1996); Banbury, 533 N.W.2d at 881 (holding that doctrine of promissory estoppel has no application where valid contract exists).
The district court did not err in its application of the law.