James F. Nuzzo v. Nuzzo Campion Stone Enterprises, Inc. f/k/a Corriveault Holdings, Inc.

Supreme Court
No. 2015-132-Appeal.
No. 2015-133-Appeal.
(PC 08-3644)
James F. Nuzzo :
v. :
Nuzzo Campion Stone Enterprises, Inc. :
f/k/a/ Corriveault Holdings, Inc.
NOTICE: This opinion is subject to formal revision before
publication in the Rhode Island Reporter. Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island, 250
Benefit Street, Providence, Rhode Island 02903, at Telephone 222-
3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.
Supreme Court
No. 2015-132-Appeal.
No. 2015-133-Appeal.
(PC 08-3644)
James F. Nuzzo :
v. :
Nuzzo Campion Stone Enterprises, Inc. :
f/k/a Corriveault Holdings, Inc.
Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Robinson, for the Court. The plaintiff, James F. Nuzzo, appeals to the Supreme
Court from a judgment of the Providence County Superior Court. At issue in the jury-waived
trial were a number of disputes between the parties that arose after the defendant corporation,
Nuzzo Campion Stone Enterprises, Inc. (NCS), was purchased by its present owner.1 After a
two-day trial and after addressing various post-trial submissions, the trial justice held that Mr.
Nuzzo was not entitled to commissions on orders that had been placed prior to his termination,
but not actually paid for by customers of NCS until after his termination. The trial justice further
held that NCS, as counterclaimant, was due $16,898.20 for both “work in progress” and warranty
work pursuant to the Asset Purchase Agreement signed by the parties.2 Mr. Nuzzo contends that
the trial justice erred in determining that he was not entitled to commissions for orders that had
been placed, but not actually paid for, prior to his termination. He also contends that the trial
1
James F. Nuzzo and Rita Campion (his wife) were shareholders of NCS until its sale in
October of 2006 to its present owner.
2
The relevant language of the Asset Purchase Agreement is quoted verbatim in the Facts
and Travel section of this opinion, infra.
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justice erred in awarding NCS $16,898.20 on its counterclaim. This case came before the
Supreme Court pursuant to an order directing the parties to appear and show cause why the
issues raised in this appeal should not be summarily decided. After a close review of the record
and careful consideration of the parties’ arguments (both written and oral), we are satisfied that
cause has not been shown and that this appeal may be decided at this time.
For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.
I
Facts and Travel
On May 23, 2008, plaintiff filed a complaint, in which he alleged that he was owed a total
of $133,816 in unpaid commissions and severance pay in accordance with his understanding of
the Sales Commission Agreement signed by the parties.3 He contended that he had earned sales
commissions in the amount of $119,663. He acknowledged that NCS had already paid him
$15,761 in commissions, leaving $103,901 in allegedly unpaid sales commissions. In addition,
he alleged that NCS owed him a severance payment of twenty-five percent of the commissions
allegedly due to him, which would amount to $29,915.4
In its answer, the defendant corporation denied that it owed Mr. Nuzzo the sales
commissions that he alleged were due to him; and it filed a counterclaim for breach of contract,
alleging that plaintiff had failed to indemnify NCS for certain amounts covered by the terms of
the Asset Purchase Agreement.
3
The relevant sections of the document known as the “Sales Commission Agreement” are
quoted, infra.
4
The plaintiff focuses his contentions on appeal on the commissions that he claims he is
due. We note that, if he were awarded those commissions, he would be entitled to an additional
severance payment as a percentage of those commissions.
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On February 4, 2013, the parties entered into a “Statement of Agreed Facts,” in which
they stipulated to the following pertinent facts: (1) that plaintiff formerly owned and operated the
defendant corporation, which sold stone and tile; (2) that plaintiff and Rita Campion (plaintiff’s
wife) were shareholders of the defendant corporation until it was sold in October of 2006
pursuant to the terms of the document referred to as the Asset Purchase Agreement; (3) that, in
connection with the sale, plaintiff entered into the Sales Commission Agreement; (4) that
plaintiff developed and procured sales for the defendant corporation from November of 2006
until he was terminated on April 30, 2007; (5) that the sales that occurred between the sale of the
defendant corporation and plaintiff’s termination amounted to $1,120,766; and (6) that plaintiff
had received $15,761 in compensation in connection with those sales.
Reduced to its essentials, this case centers around a dispute concerning two documents
signed by the parties—viz., the Sales Commission Agreement and the Asset Purchase
Agreement. The Sales Commission Agreement was admitted as a full exhibit at trial. The
relevant portions of that document (contained in sections 6(a) and 6(b)) read as follows:
“6. Compensation. (a) General Sales. * * * Commissions
shall be deemed to have been earned when an order is paid in full,
unless otherwise agreed between the parties.
“* * *
“(b) Material Tile Sales. * * * Tile commission payments
shall be deemed to have been earned when an order is paid in full,
unless otherwise agreed between the parties.”
The Asset Purchase Agreement was also admitted as a full exhibit at trial. The relevant portion
of that document (contained in Article IV, Section 4.5(c)) reads in pertinent part as follows:
“Buyer shall complete performance of each Contract identified on
Exhibit B required to be completed after the Closing Date for the
account of the Sellers, provided that Seller shall indemnify Buyer
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for such costs as are incurred in connection with the performance
of any such Contract obligation after the closing date * * *.”5
On February 4 and 5 of 2013, a jury-waived trial was held. Mr. Nuzzo and David
Corriveault, the present owner of NCS, testified at trial.
A
The Trial Court’s Decision
On May 29, 2013, the trial justice issued a written decision addressing the commissions
due to Mr. Nuzzo, the severance pay due to Mr. Nuzzo, and NCS’s counterclaim against Mr.
Nuzzo. Thereafter, the defendant corporation filed a motion contending that the discussion of
the counterclaim in the trial justice’s decision erroneously focused on the Sales Commission
Agreement rather than the Asset Purchase Agreement. After conducting a hearing with respect
to that contention, the trial justice vacated his initial decision in its entirety. Subsequently, after
entertaining further argument, he issued a revised decision on January 2, 2014, in which he
considered the counterclaim issues in light of the Asset Purchase Agreement and not the Sales
Commission Agreement. (The revised decision is essentially identical to the initial decision in
all other respects.) In the discussion that follows, we shall limit our attention to the revised
decision.
In the revised decision, the trial justice first addressed plaintiff’s contentions concerning
commissions and severance. With respect to plaintiff’s claim for commissions that he alleged
were due to him from sales placed, but not actually paid for by the defendant corporation’s
customers, prior to plaintiff’s termination, the trial justice concluded that plaintiff had not
5
The “closing date” that is mentioned in the language from the Asset Purchase Agreement
quoted in the text refers to the sale of the defendant corporation that, according to the Statement
of Agreed Facts, took place in October of 2006.
-4-
established that he was owed any commissions from sales falling into that category. The trial
justice found the Sales Commission Agreement to be “clear on its face and unambiguous,” and
he read it as providing (in his words) that a “commission is only due and earned when the
customer pays for the order.” (Emphasis in original.) The trial justice further noted that,
pursuant to that Agreement, “no commission is due when a sale is worked up, and a customer is
tended to, or even when an order is placed.” As such, the trial justice ruled that Mr. Nuzzo was
not entitled to the commissions that he was seeking.6 As to the severance pay that plaintiff
claimed was due to him (calculated as a percentage of commissions on orders paid for after his
termination), the trial justice determined that plaintiff had not “submitted sufficient proof * * * to
substantiate the amount of severance he claims.”7
Additionally, the trial justice concluded that the defendant corporation was due
$16,898.20 in reimbursement costs on its counterclaim pursuant to Article IV, Section 4.5(c) of
the Asset Purchase Agreement (a completely different document from the one relied upon in the
initial decision), which provides that plaintiff shall indemnify the defendant corporation for the
costs incurred in connection with “work in progress”8 and warranty work. The trial justice noted
that “there was no real dispute that Mr. Nuzzo executed this indemnification and that the
indemnification is enforceable.” Additionally, the trial justice stated that the defendant
6
As for commissions that were not barred by the Sales Commission Agreement, the trial
justice stated that plaintiff was due $28,691.02—an amount which the defendant corporation
does not contest on appeal.
7
The trial justice noted that plaintiff was owed $7,176.76 in unpaid severance (being a
percentage of the $28,691.02 in commissions undisputedly due to plaintiff)—an amount which
the defendant corporation once again does not contest on appeal.
8
According to the Statement of Agreed Facts, it is undisputed that the terms “work in
progress” and “jobs in process” refer to jobs that were underway, but had not yet been completed
at the time of the sale of NCS.
-5-
corporation “performed work and satisfied customer orders, obligations and commitments for
ongoing work and for warranty work” and that invoices reflecting those charges were then
provided to Mr. Nuzzo. The trial justice further stated that a balance of $16,898.20 remained due
to the defendant corporation from plaintiff pursuant to the terms of the Asset Purchase
Agreement. The trial justice noted that Mr. Corriveault, the present owner of the defendant
corporation, testified concerning the services performed and submitted invoices for the “work in
progress,” which Mr. Nuzzo never established were inaccurate. Furthermore, the trial justice
determined that the testimony of Mr. Corriveault as well as the submitted invoices, were “clear,
rational, reliable, comprehensive and highly persuasive.” Accordingly, the trial justice
determined that “indemnification [was] reasonable and appropriate.”
Judgment entered on July 2, 2014 in accordance with the trial justice’s decision.
II
Issues on Appeal
The plaintiff contends: (1) that the trial justice erred in determining that plaintiff was not
entitled to commissions on those orders which had been placed prior to his termination, but for
which payment was actually made after the date of his termination; and (2) that the trial justice
made “fundamental mistakes regarding the contract and damages” relating to the counterclaim
and that plaintiff was consequently entitled to a new trial.
III
Standard of Review
It is well established that this Court applies a “deferential standard of review with respect
to the factual findings of a trial justice sitting without a jury in a civil case.” B.S. International
Ltd. v. JMAM, LLC, 13 A.3d 1057, 1062 (R.I. 2011); see also Duffy v. Estate of Scire, 111 A.3d
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358, 363 (R.I. 2015). Accordingly, this Court will not disturb factual findings “unless the record
shows that the findings are clearly wrong or unless the trial justice overlooked or misconceived
material evidence on a controlling issue.” B.S. International Ltd., 13 A.3d at 1062 (internal
quotation marks omitted). It is also a basic principle in this context that “[i]f, as we review the
record, it becomes clear to us that the record indicates that competent evidence supports the trial
justice’s findings, we shall not substitute our view of the evidence for his [or hers] even though a
contrary conclusion could have been reached.” Carrozza v. Voccola, 90 A.3d 142, 151 (R.I.
2014) (internal quotation marks omitted).
It is axiomatic that the “interpretation of an unambiguous contract is a question of law.”
B.S. International Ltd., 13 A.3d at 1063. Accordingly, since it is not contended that the
contractual language at issue is ambiguous, we shall review in a de novo manner the trial court’s
reading of the unambiguous contractual language at issue. Id. In doing so, we shall bear in mind
that, “[w]hen contract language is clear and unambiguous, words contained therein will be given
their usual and ordinary meaning and the parties will be bound by such meaning.” DiPaola v.
DiPaola, 16 A.3d 571, 576 (R.I. 2011) (internal quotation marks omitted). In such cases, a
contract’s “meaning should be determined without reference to extrinsic facts or aids.” JPL
Livery Services, Inc. v. Rhode Island Department of Administration, 88 A.3d 1134, 1142 (R.I.
2014) (internal quotation marks omitted).
-7-
IV
Analysis
A
The Commissions
The plaintiff contends that the trial justice erred in interpreting the language in the Sales
Commission Agreement as providing that plaintiff was not entitled to commissions on orders
placed before his termination, but not actually paid for until after plaintiff’s termination. The
trial justice determined that sections 6(a) and 6(b) of the Sales Commission Agreement, which
pertain to commissions, are unambiguous; accordingly, he applied those sections to the agreed-
upon facts. The trial justice noted that the two just-referenced sections of the Sales Commission
Agreement both explicitly provide that the commissions at issue “shall be deemed to have been
earned when an order is paid in full * * *.” (Emphasis added.) The trial justice concluded that
that language clearly provides that “[a] commission is only due and earned when the customer
pays for the order.” (Emphasis in original.) After a thorough review of the record and the
pertinent agreement, we perceive no error in the trial justice’s reasoning in that regard.
In connection with his claimed entitlement to commissions, plaintiff further contends that
he falls within the general rule laid out in Oken v. National Chain Co., 424 A.2d 234, 235 (R.I.
1981). In Oken, the Court stated: “As a general rule, a person employed on a commission basis
to solicit sales orders earns or is entitled to his commission when the order is accepted by his
employer.” Id. Significantly, however, the Court in Oken proceeded to indicate that the general
rule is not absolute; the Court specifically indicated that the general rule “may be altered by a
written agreement by * * * the parties which clearly demonstrates a different compensation
scheme.” Id. After focusing on the explicit language of the signed Sales Commission
-8-
Agreement, the trial justice stated: “The contract is clear: he is not entitled to [the] commissions
[he is seeking]. * * * Mr. Nuzzo has not established that Nuzzo Campion Stone Enterprises, Inc.
breached the contract.” Having reviewed the language of the Sales Commission Agreement, we
understand it to reflect the sort of departure from the general rule “by a written agreement” that
this Court in Oken specifically indicated was permissible.9 Id. Accordingly, we are in full
agreement with the trial justice that plaintiff’s breach of contract claim for commissions on
orders placed before plaintiff was terminated but paid for by customers after his termination is
meritless.10
B
The Counterclaim
Turning next to the plaintiff’s challenge to the award of damages under the counterclaim,
we note that the “Argument” section of the plaintiff’s submission to this Court devotes a total of
four short sentences to the counterclaim issue, and he completely fails to direct us to what he
considers to be erroneous in the trial justice’s findings and conclusions as set forth in the revised
decision. Instead, he simply expresses his displeasure over the fact that the trial justice issued a
9
One may question the wisdom of plaintiff’s decision to agree to the quoted provisions of
the Sales Commission Agreement. But the plain, blunt fact is that he did agree to the terms of
that written contract, and he is therefore subject to those terms. See Sophie F. Bronowiski
Mulligan Irrevocable Trust v. Bridges, 44 A.3d 116, 122 (R.I. 2012) (“[U]nder established
contract law principles, when there is an unambiguous contract and no proof of duress or the
like, the terms of the contract are to be applied as written.”) (internal quotation marks omitted);
Rivera v. Gagnon, 847 A.2d 280, 284 (R.I. 2004) (“If the contract terms are clear and
unambiguous, judicial construction is at an end for the terms will be applied as written.”).
10
Contrary to another of plaintiff’s contentions, there is no requirement that the “written
agreement” authorized by Oken v. National Chain Co., 424 A.2d 234, 235 (R.I. 1981), must
include specific language stating that the person entering into such an agreement is agreeing to
forfeit his or her commissions. The language contained in the Sales Commission Agreement in
this case is completely clear and dispositive, and no further embellishment was necessary. See
Pearson v. Pearson, 11 A.3d 103, 109 (R.I. 2011) (“We decline to read non-existent terms * * *
into a contract.”).
-9-
revised decision after he came to realize that his initial decision was the product of documentary
confusion. It is our view that the trial justice acted appropriately and with laudable candor in
recognizing the error in his initial decision and in then proceeding to address the merits of the
counterclaim in light of the provisions of the correct document (the Asset Purchase Agreement).
The plaintiff has not directed our attention with specificity to any error that he alleges has been
committed in that regard or otherwise. See Town Houses at Bonnet Shores Condominium
Association v. Langlois, 45 A.3d 577, 584 (R.I. 2012) (declining to address on appeal issues that
“were not sufficiently developed in [appellant’s] * * * submissions to this Court”); Wilkinson v.
State Crime Laboratory Commission, 788 A.2d 1129, 1131 n.1 (R.I. 2002); see also McMahon v.
Deutsche Bank National Trust Co., 131 A.3d 175, 176 (R.I. 2016) (mem.). Accordingly, we find
the plaintiff’s counterclaim argument to be waived and we affirm the trial justice’s ruling.
V
Conclusion
For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.
The record may be remanded to that tribunal.
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RHODE ISLAND SUPREME COURT CLERK’S
OFFICE
Clerk’s Office Order/Opinion Cover Sheet
TITLE OF CASE: James F. Nuzzo v. Nuzzo Campion Stone Enterprises, Inc. f/k/a
Corriveault Holdings, Inc.
CASE NO: No. 2015-132-Appeal.
No. 2015-133-Appeal.
(PC 08-3644)
COURT: Supreme Court
DATE OPINION FILED: April 21, 2016
JUSTICES: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
WRITTEN BY: Associate Justice William P. Robinson III
SOURCE OF APPEAL: Providence County Superior Court
JUDGE FROM LOWER COURT:
Associate Justice Jeffrey A. Lanphear
ATTORNEYS ON APPEAL:
For Plaintiff: David M. Campbell, Esq.
For Defendant: Andrew J. Tine, Esq.