Beauty Lab & Laser, LLC v. Jelosek

539 P.3d 830

BEAUTY LAB AND LASER, LLC, Appellee,

v.Rachelle JELOSEK, Appellant.

No. 20210719-CA

Court of Appeals of Utah.

Filed November 16, 2023

Austin B. Egan, Draper, Attorney for Appellant

Casey Jones and Scarlet R. Smith, Salt Lake City, Attorneys for Appellee

Judge John D. Luthy authored this Opinion, in which Judges David N. Mortensen and Ryan M. Harris concurred.

Opinion

LUTHY, Judge:

¶1 Beauty Lab and Laser, LLC (Beauty Lab) "provides a variety of cosmetic, laser, and skincare services, including Botox and lip injections." Rachelle Jelosek is a board-certified family nurse practitioner who worked for a time as Beauty Lab's medical director. Jelosek placed orders for injection products from a company called Allergan. Some orders were for products for Beauty Lab, and some were for products for Jelosek's independent use at an offsite salon (the Salon). When Jelosek stopped working for Beauty Lab, there were four unpaid Allergan invoices (the Invoices) for products that had been shipped to the Salon. Beauty Lab said the Invoices were for products ordered for Jelosek's independent use. Jelosek disagreed and refused to pay the Invoices. Beauty Lab then paid the Invoices and sued Jelosek for breach of contract.

¶2 The parties filed cross-motions for summary judgment and submitted various declarations and other evidence in support of their motions. Based on the parties’ submissions, the district court determined that there was no genuine dispute that the parties had a valid oral contract that Beauty Lab would pay for products ordered for its use and that Jelosek would pay for products ordered for her use. The court further determined that there was no genuine dispute that Jelosek had breached the contract because Beauty Lab produced evidence that the products at issue in the Invoices were retained by Jelosek for her use and Jelosek failed to rebut that evidence. The court therefore granted summary judgment in favor of Beauty Lab, and Jelosek now appeals. We agree that the parties contracted to each pay for the products intended for their own respective uses and that there is no genuine dispute that the products associated with the Invoices were retained by Jelosek for her independent use. We therefore affirm.

BACKGROUND

¶3 Jelosek began working for Beauty Lab in April 2017 as its medical director. Shortly thereafter, Beauty Lab and Jelosek signed an "Independent Contractor Agreement," which described Jelosek's duties as "perform[ing] cosmetic injection beautification services, techniques and procedures on [Beauty Lab] clientele as needed [and] review[ing] client charts and [the] performance of other [Beauty Lab] staff." The Independent Contractor Agreement said that "[f]or all services rendered by [Jelosek] under this agreement," Jelosek would receive "20% of injections sales, and complimentary skincare and laser services."

¶4 In addition to her work for Beauty Lab, Jelosek performed injections for her own clients at the Salon. Jelosek therefore ordered injection products from Allergan both for Beauty Lab and for her independent use. She ordered the products through a "joint account" with Beauty Lab. As Jelosek explained, "Beauty Lab did not and could not have its own account with Allergan and needed to have a joint account with ... Jelosek because ... Jelosek had the medical license credentials." Some of the Allergan products Jelosek ordered were shipped to Beauty Lab, and some were shipped to the Salon.

¶5 In September 2019, Jelosek informed Beauty Lab that she had accepted a position elsewhere. When Jelosek left Beauty Lab, the Invoices reflected an outstanding balance of $26,662 for products that had been shipped to the Salon. Allergan refused to fill future orders for Beauty Lab until the Invoices were paid, and Jelosek was unwilling to pay them. So, Beauty Lab paid the balance and sued Jelosek for breach of contract.

¶6 In its complaint, Beauty Lab alleged that it and Jelosek had "entered into an agreement whereby they agreed[,] among other things, that Jelosek would pay for the injection products ordered from Allergan for injection services that Jelosek performed outside of Beauty Lab's office." Jelosek admitted that allegation in her answer, but she denied Beauty Lab's further allegation that she had "breached the agreement by not paying" for the Invoices.¹

¶7 Beauty Lab subsequently filed a motion for summary judgment. In support of its motion, Beauty Lab submitted a declaration from one of its co-owners (Co-owner), in which Co-owner stated that "[Jelosek] would pay for the invoices reflecting Allergan products that she ordered to perform her own independent services" and that "Allergan products ... shipped to [the Salon] were meant only for Jelosek and were to be used for her own independent clients." Co-owner similarly declared that "Beauty Lab would pay for the invoices reflecting Allergan products that were shipped to Beauty Lab's offices." Beauty Lab also submitted the following deposition testimony from Jelosek regarding how Jelosek knew which Allergan products she was to pay for:

Q: How would we be able to know which invoices Beauty Lab paid for and which ones you paid for?

A: The only way that I would know is if I was given the information from [Co-owner], because I didn't have access to that end of the financial information. I had access to one account that was my ship-to account, but I didn't have access to the financial account.

Q: Did you receive copies of ... invoices from Allergan?

A: Not until they were sent [to me from Beauty Lab during this litigation]. That was the first time I've ever seen any ... invoices.

Q: So how would you know how much to pay?

A: I would log onto ... the Allergan system, and [Co-owner] would tell me what I needed to pay.

Relying on the foregoing evidence, Beauty Lab argued that "it is undisputed that Jelosek was obligated to pay [the Invoices]" because the products associated with the Invoices were "shipp[ed] to [the Salon]."

¶8 Jelosek responded to Beauty Lab's motion and attached her own declaration in which she stated, "I paid invoices for products that I knew to be used for my personal business." But she declared that not all Allergan products shipped to the Salon were for her personal business. Specifically, Jelosek declared that "[s]ome of the product that Allergan shipped to [the Salon] was payment from Beauty Lab in exchange for [her] services" and that "[s]ome of the product that Allergan shipped to [the Salon] was ordered by Beauty Lab to be specifically delivered to [the Salon] so it would receive additional discounts and/or rebates." Jelosek further asserted that "[t]here is no evidence to show that the product [associated with the Invoices] was for [her] personal clients," and she argued that Beauty Lab's motion should therefore be denied.

¶9 Beauty Lab replied and did not dispute for purposes of its motion that sometimes it gave Allergan products to Jelosek as compensation or that sometimes it had Allergan products intended for its use shipped to the Salon. But Beauty Lab submitted another declaration from Co-owner, in which Co-owner declared that Beauty Lab did not order, pick up, or use any of the products associated with the Invoices and that "Beauty Lab did not pay [Jelosek] in product pertaining to [the Invoices]." Beauty Lab then argued that it was entitled to summary judgment because (1) Jelosek had admitted to an oral agreement under which she would pay "for products that [she] knew to be used for [her] personal business"; (2) even if Beauty Lab sometimes had Allergan products intended for its use shipped to the Salon and sometimes ordered Allergan products that it gave to Jelosek as compensation, Beauty Lab had produced evidence (in the form of Co-owner's declaration) that neither of those things was true with regard to the products associated with the Invoices; and (3) Jelosek had failed to produce evidence to contradict Co-owner's declarations regarding the products associated with the Invoices.

¶10 Jelosek subsequently filed her own motion for summary judgment, relying in part on arguments similar to those in her opposition to Beauty Lab's motion. She also submitted an additional declaration from herself as well as declarations from the owner and a receptionist of the Salon. These declared that Beauty Lab sometimes had Allergan products intended for its use shipped to the Salon for pickup by a Beauty Lab employee. Jelosek also declared, again, that Beauty Lab sometimes "directed Allergan to deliver product to [the Salon] as payment for [her] services." However, none of the declarations Jelosek submitted said anything about the specific products associated with the Invoices.

¶11 The district court held a hearing on the cross-motions for summary judgment. At the conclusion of the hearing, the court ruled that it was "clear" from the pleadings, declarations, and deposition testimony that the parties had agreed that "Jelosek would pay for products that she retained." When it memorialized that ruling in a written order, the court stated that there was no dispute regarding the existence of a valid oral agreement "that Jelosek would pay for products she used for her independent injection services," meaning that she would pay for products she "use[d] or intend[ed] to use."

¶12 The district court acknowledged that Jelosek had produced evidence that "products were on occasion delivered to [the Salon] and then picked up by Beauty Lab." But the court noted that "nowhere" did "Jelosek or any of the other employees of [the Salon] state that the [products] that are at issue [in the Invoices] ... were picked up and used by Beauty Lab." The court said "the only fact before" it on this point was Co-owner's declaration "that [Beauty Lab] did not receive that product" and did not intend that product as compensation for Jelosek's services. Thus, the court concluded that there was no genuine dispute that Jelosek had received and retained the specific products associated...