Ollis v. Ambassador Real Estate Co.

DOYLE OLLIS, APPELLEE AND CROSS-APPELLANT, v. AMBASSADOR REAL ESTATE COMPANY,DOING BUSINESS AS BERKSHIRE HATHAWAY HOME SERVICES AMBASSADORREAL ESTATE, APPELLANT AND CROSS-APPELLEE.

No. A-20-564.

NEBRASKA COURT OF APPEALS

June 1, 2021

MEMORANDUM OPINION AND JUDGMENT ON APPEAL

(Memorandum Web Opinion)

NOTICE: THIS OPINION IS NOT DESIGNATED FOR PERMANENT PUBLICATION AND MAY NOT BE CITED EXCEPT AS PROVIDED BY NEB. CT. R. APP. P. § 2-102(E).

Appeal from the District Court for Douglas County: JAMES T. GLEASON, Judge. Affirmed in part, and in part reversed.

Douglas W. Ruge for appellant.

Kristopher J. Covi, of McGrath, North, Mullin & Kratz, P.C., L.L.O., for appellee.

RIEDMANN, ARTERBURN, and WELCH, Judges.

WELCH, Judge.

INTRODUCTION

Ambassador Real Estate Co. (Ambassador) appeals from an order of the Douglas County District Court finding that Ambassador breached its Independent Contractors Agreement with Doyle Ollis, a real estate agent with Ambassador, and awarding Ollis $11,880 in commissions due. Ollis filed a cross-appeal asserting the district court erred by not awarding him $13,700 in damages and not awarding him prejudgment interest. For the reasons set forth herein, we affirm in part, and in part reverse.

STATEMENT OF FACTS

In 2006, Ollis, a licensed real estate agent, entered into a Real Estate Broker-Salesperson Contract (Broker-Salesperson Contract) with CBSHOME Real Estate (CBSHOME) wherein Ollis agreed to serve as a "salesperson" for CBSHOME pursuant to the terms and conditions of the contract. The contract specified that Ollis would be considered an independent contractor of CBSHOME; that CBSHOME would make its listings available to Ollis; that Ollis would use his best efforts to sell real estate listed with CBSHOME while seeking additional listings for them; that Ollis would abide by applicable laws and regulations; that Ollis would be paid commissions in accordance with the CBSHOME Commission Schedule; that Ollis agreed to confidentiality provisions governing CBSHOME materials; that Ollis agreed to certain expense allocations with offset rights to Ambassador against Ollis' commissions (including the right to charge a 30-percent commission collection fee) upon termination; that Ollis agreed to procure automobile insurance within certain insurance policy limits; that CBSHOME would provide certain office accommodations; that the parties would resolve disputes in certain ways; and other related provisions.

According to the affidavit of Scott Vogt who identified himself as the Chief Executive Officer and broker of record for CBSHOME and Chief Operating Officer (COO) for Ambassador:

[Ambassador] and CBSHOME announced in late 2018 that they would merge as companies based on their, now, common ownership with the merged company being called "Ambassador." Independent cont[r]actor agents were informed that they needed to change their affiliation from a broker under "CBSHOME" to a broker under "Ambassador" before the end of the year.

Vogt went on to describe that Ollis' Broker-Salesperson Contract with CBSHOME was assumed in the merger; that in October 2018, Ollis decided to move his license to Ambassador, signed a "Maximum 100% Commission Plan," and subsequently signed an "Independent Contractors Agreement" with Ambassador in November. Vogt then stated that "[Ollis] and his team began to conduct business as agents for Ambassador and also had transactions for CBSHOME as well that had already been put under contract or 'pended' as the term is used in the industry."

Similar to the Broker-Salesperson Contract between Ollis and CBSHOME, the Independent Contractors Agreement between Ollis and Ambassador described Ollis as a "Sales Associate [who] shall conduct all licensed real estate activities in which the Sales Associate becomes involved during the term of this Agreement exclusively in association with . . . Ambassador"; that Ollis would be considered an independent contractor under the arrangement; that Ambassador would make its listings available to Ollis; that Ollis would use "diligent" efforts to sell real estate listed with Ambassador; that Ollis would abide by applicable rules and regulations; that Ollis would be paid commissions in accordance with the commission schedule until "[Ambassador] and [Ollis] agree to amend their arrangement"; that Ollis agreed to certain confidentiality obligations governing Ambassador materials; that Ollis agreed to certain sales expense obligations; that Ollis agreed to procure certain automobile and professional errors and omissions insurance within defined limits; that Ambassador would provide certain office accommodations; that the parties would resolve disputes in a defined manner; and other related matters including, but not limited to, a termination clause which provided:

This agreement may be terminated by either party upon three (3) days prior written notice. The Agreement shall automatically terminate upon the death of [Ollis]. In the eventof such termination, all purchase agreements and sales contracts, solicited by [Ollis] and executed partially and wholly prior to the effective date of such termination, though not closed prior to such effective date, shall remain subject to this Agreement. In the event of any termination, all listings remain the property of [Ambassador].

Commissions to which [Ollis] may be entitled by reason of such purchase agreements, sales contracts or listings shall be paid to [Ollis] within three (3) days of actual receipt of such commissions by [Ambassador].

Separately, in the "Maximum 100% Commission Plan," which was signed prior to the Independent Contractor Agreement, the parties described that Ollis would pay Ambassador a base monthly rate of $990 (Base Rate) together with other fixed charges associated with listings and sales, subject to the following language:

Ollis (Agent) agrees to be on [Ambassador]'s Maximum 100% Commission Plan until 3-31-20 (date) with the following understanding: 100% program fee of $990/month, office fee of (no office selected) month, and any Buyer's Agent fees of $250/month to be waived through 3-31-19 (date) with the billing fee for the 100% program, office fee, and Buyer's Agent fees beginning 4-1-19 (date). It is also understood that Agent will receive a credit up to $5,000 for conversion costs to use signs, business cards, and other marketing materials as established by agent. Agent understands and agrees that there will be additional cost should agent chose to have an office.

(Emphasis in original).

In December 21, 2018, Ollis terminated his relationship with Ambassador and sought payment for the commissions due to him but not yet paid by Ambassador. In March 2019, Ollis filed a complaint alleging Ambassador breached the terms of the Independent Contractors Agreement with Ollis and committed conversion by failing to pay Ollis the commissions owed to him. Ollis further requested the court award him prejudgment interest. In its answer, Ambassador denied Ollis' allegations and brought a counterclaim claiming Ambassador had the right to offset commissions owed to Ollis relating to monthly amounts Ollis owed Ambassador, that being 12 months of Ollis' unpaid Base Rate of $990 per month under the Maximum 100% Commission Plan for a total of $11,880 together with $1,900 for a marketing and technology fee. In his affidavit, Ollis claimed he was owed $13,700 in commissions and that neither the alleged unpaid Base Rate or marketing and technology fee were owed by him. Thus, the lawsuit basically boiled down to whether Ambassador was entitled to collect 12 months of Base Rate from Ollis and offset the Base Rate and a marketing and technology fee against Ollis' commissions.

Both Ollis and Ambassador filed cross-motions for summary judgment claiming that pursuant to the undisputed facts in the offered affidavits and aforementioned contracts, each party was entitled to judgment as a matter of law on its claim for damages.

The district court entered an order finding the Independent Contractors Agreement and Maximum 100% Commission Plan superseded the Broker-Salesperson Contract and governed the parties' dispute. The court found the parties did not dispute Ollis' ability to terminate the agreement pursuant to the termination provision contained in the Independent Contractors Agreement.Further, the court found that after termination, there is no reference to the continuation of payments required under the Maximum 100% Commission Plan. The court determined that because Ollis had terminated the agreement, Ambassador owed Ollis $11,880 pursuant to the terms of the contract.

Ambassador has timely appealed to this court and Ollis filed a cross-appeal.

ASSIGNMENTS OF ERROR

Ambassador assigns that the district court erred in (1) finding the Ambassador Independent Contractors Agreement superseded the CBSHOME Broker-Salesperson Contract and that, by implication, the court erred in finding there was no right to setoff against the commissions, the Base Rate fees owed by Ollis to the Ambassador, or, in the alternative, the right to charge 30 percent against those commissions under a term in the Broker-Salesperson Contract, and (2) awarding Ollis $11,880 rather than finding Ollis breached the Independent Contractors Agreement and Maximum 100% Commission Plan.

In his cross-appeal, Ollis assigns the district court erred (1) in failing to award him $1,900 in commissions because he did not owe Ambassador a marketing and technology fee and (2) by failing to award Ollis prejudgment interest at the statutory rate of 12 percent pursuant to Neb. Rev. Stat. § 45-104 (Reissue 2010).

STANDARD OF REVIEW

Summary judgment is proper when the pleadings and the evidence admitted at the hearing disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law. Dondlinger v. Nelson, 305 Neb. 894, 942 N.W.2d 772 (2020). An appellate...