No. 20111-2-IIIThe Court of Appeals of Washington, Division Three. Panel Five.
Filed: June 20, 2002 UNPUBLISHED OPINION
Appeal from Superior Court of Spokane County, No. 97-2-07600-0, Hon. Paul A. Bastine, March 21, 2001, Judgment or order under review.
Counsel for Appellant(s), Jerry L. Kagele, Attorney At Law, 601 W Riverside Ave #1380, Spokane, WA 99201.
Counsel for Respondent(s), John R. Zeimantz, Feltman Gebhardt Greer
Zeimantz, 421 W Riverside Ave #1400, Spokane, WA 99201-0495.
KURTZ, J.
Desiree Nagyfy contracted with Spokane Hardware Supply, Inc., for computer consulting services. After several years, Ms. Nagyfy’s services were terminated. Ms. Nagyfy sued both Spokane Hardware and its president, Stephen Northrop. Mr. Northrop counterclaimed for money loaned to Ms. Nagyfy. The court denied all claims. In her appeal, Ms. Nagyfy contends that her contract with Spokane Hardware required it to pay her a percentage of its total sales. We affirm the trial court which ruled that there was no enforceable agreement regarding the payment of a percentage of the profits or total sales to Ms. Nagyfy.
FACTS
Desiree Nagyfy operated a sole proprietorship business consulting service she called Business Dynamics Consulting. In the fall of 1994, she approached Stephen J. Northrop, President of Spokane Hardware Supply, Inc., with a proposal to provide management consulting services. After initial meetings with Mr. Northrop and his staff at Spokane Hardware, Ms. Nagyfy prepared a 12-page proposal to provide services entitled `Proposal for Spokane Hardware Supply, Inc.,’ dated November 3, 1994, and signed by Ms. Nagyfy. Ex. D-904.
Thereafter, an agreement entitled `Client Agreement Statement of Services’ was drafted by Ms. Nagyfy and signed by her and Spokane Hardware on November 18, 1994. Ex. P-702. A second version of the `Client Agreement Statement of Services,’ again drafted by Ms. Nagyfy, was signed on November 25, 1994, by Ms. Nagyfy and Spokane Hardware. Ex. P-703. This agreement contained a noncompetition clause drafted by Mr. Northrop.
Both versions of the agreement provided that Ms. Nagyfy was to be paid $3,000 per month for an indeterminate period of time for her consulting work. Ms. Nagyfy testified at trial that her services were terminable at will by Spokane Hardware. Both agreements also provided that Ms. Nagyfy’s legal liability was limited to $500 and that she was not responsible for obtaining any results. Both versions of the consulting agreement also incorporated by reference the proposal for services dated November 3, 1994, and signed by Ms. Nagyfy.
The first version of the `Client Agreement Statement of Services’ signed on November 18, 1994, makes no provision for payment of any compensation to Ms. Nagyfy beyond $3,000 per month. Ex. P-702. Nor does the November 3, 1994 `Proposal for Spokane Hardware Supply, Inc.’ incorporated by reference in both versions of the `Client Agreement
Statement of Services.’ Ex. D-904.
The second version of the `Client Agreement Statement of Services’ drafted by Ms. Nagyfy and signed on November 25, 1994, states that she would receive as additional compensation `a percentage of profits to be specified in a separate agreement.’ Ex. P-703. According to Ms. Nagyfy, this change came about because after signing the November 18, 1994 agreement, Mr. Northrop was so enthused about her services increasing sales of Spokane Hardware that he wanted to add provisions to the agreement paying her additional compensation — a `percentage of [the] sales’ of Spokane Hardware. Report of Proceedings at 154 (emphasis added).
There was no separate agreement between Spokane Hardware and Ms. Nagyfy to pay Ms. Nagyfy any specific percentage of the profits of Spokane Hardware. However, another document was prepared by Ms. Nagyfy which she titled `Cost Analysis.’ Clerk’s Papers (CP) at 56. This document was attached to a second version of the Proposal for Spokane Hardware Supply, Inc., but Mr. Northrop denied ever receiving the document. The unsigned `Cost Analysis’ states that Ms. Nagyfy is to receive a percentage of Spokane Hardware’s total sales in an amount to be determined at a later date by agreement but in the range of five percent.
Ms. Nagyfy’s consulting work for Spokane Hardware commenced in December 1994. Each month, Ms. Nagyfy invoiced Spokane Hardware $3,000 for compensation. No percentage of profits or a percentage of total sales of Spokane Hardware was ever collected by Ms. Nagyfy.
In 1995, Ms. Nagyfy suggested to Mr. Northrop that an opportunity existed to market internet websites. Ms. Nagyfy and Mr. Northrop formed AVM Corporation in October 1995 for the purpose of producing, marketing, and selling Internet websites in a virtual shopping mall to be created by AVM Corporation. Mr. Northrop and Ms. Nagyfy were each 50 percent owners of AVM Corporation. Mr. Northrop loaned $80,000 to the company, contributed $10,000 for his stock, and loaned Ms. Nagyfy $10,000 for her stock. In addition, Mr. Northrop and Ms. Nagyfy borrowed $50,000 from U.S. Bank which funds were also used by AVM Corporation. That loan was repaid by Mr. Northrop. The AVM Corporation business venture continued from October 1995 through August 1997 when the corporation was unable to continue due to lack of income.
Ms. Nagyfy filed a lawsuit against Spokane Hardware for breach of contract alleging that she was entitled to five percent of Spokane Hardware’s gross business sales for 1995, 1996, and 1997. The damages claimed by Ms. Nagyfy for breach of contract amounted to $1,069,673. In a separate claim, Ms. Nagyfy claimed that Mr. Northrop breached fiduciary duties owing to her as a co-owner of AVM Corporation. She claimed an additional $1 million dollars in damages for this alleged breach of fiduciary duty.
Mr. Northrop counterclaimed for the money loaned to Ms. Nagyfy and AVM Corporation as well as contribution from Ms. Nagyfy on the $50,000 bank loan repaid by Mr. Northrop.
The trial court denied all claims. Ms. Nagyfy’s claims were dismissed at the conclusion of the presentation of her case on Spokane Hardware’s CR 41(b)(3) motion. Ms. Nagyfy does not appeal denial of her breach of fiduciary duty claim against Mr. Northrop personally, nor does Mr. Northrop appeal denial of his claims against Ms. Nagyfy or AVM Corporation. Ms. Nagyfy appeals solely the denial of her breach of contract claim.
ANALYSIS
Ms. Nagyfy contends that the court erred by not interpreting the contract to require a payment to her of five percent of Spokane Hardware’s total sales. She argues that the contract was not ambiguous because Mr. Northrop clearly agreed to pay her a percentage of the profits. She contends that the court should have looked at the `Cost Analysis’ and determined that `percentage of profits’[1] was intended to be five percent of Spokane Hardware’s total sales. Spokane Hardware argues that no agreement was reached because it is impossible to reconcile the language referring to additional compensation as an unstated percentage of profits with language referring to the additional compensation as an unstated percentage of gross sales.
The entry of findings and conclusions in this case is a strong indication that the court granted Spokane Hardware’s CR 41(b)(3) motion to dismiss as a matter of fact. Roy v. Goerz, 26 Wn. App. 807, 810, 614 P.2d 1308 (1980), overruled on other grounds by Chaplin v. Sanders, 100 Wn.2d 853, 676 P.2d 431 (1984). This means that the court weighed the evidence in support of Ms. Nagyfy’s case and made a factual determination that the credible evidence establishes facts which precluded Ms. Nagyfy’s recovery. Thus, our scope of review is limited to whether the court’s findings of fact are supported by substantial evidence. Roy, 26 Wn. App. at 810.
A contract is not formed unless there is mutual assent between the contracting parties. Ottgen v. Clover Park Technical Coll., 84 Wn. App. 214, 219, 928 P.2d 1119 (1996). Mutual assent must be gathered from the outward expression of the parties and not their unexpressed subjective intention. See City of Everett v. Estate of Sumstad, 95 Wn.2d 853, 855, 631 P.2d 366 (1981). We impute an intention corresponding to the reasonable meaning of a party’s words and acts. Id.
The evidence shows that the `Client Agreement Statement of Services’ of November 25, 1995, provides for a payment to Ms. Nagyfy of `a percentage of profits to be specified in a separate agreement.’ Ex. P-703 (emphasis added). There was no separate agreement. However, a `Cost Analysis’ page was added to the proposal that provided for a payment of a percentage of Spokane Hardware Supply’s total sales, this percentage to be determined at a later date. This evidence indicates that there was never a meeting of the minds as to whether Ms. Nagyfy would receive a percentage of the profits, or a percentage of the total sales. And, there was never an agreement as to what that percentage would be. The evidence also showed that in the three years Ms. Nagyfy worked for Mr. Northrop, no percentage of profits or total sales was ever paid to Ms. Nagyfy.
`A contract provision is ambiguous when its terms are uncertain or when its terms are capable of being understood as having more than one meaning.’ Shafer v. Bd. of Trustees of Sandy Hook Yacht Club Estates, Inc., 76 Wn. App. 267, 275, 883 P.2d 1387 (1994). When there is uncertainty of meaning in the terms of the promise that the court cannot resolve, the promise is fatally ambiguous and void. Peoples Mortgage Co. v. Vista View Builders, 6 Wn. App. 744, 748, 496 P.2d 354 (1972). A court may look to parol evidence to explain the ambiguity and, if the meaning remains unclear, no contract is formed. Id.
Ms. Nagyfy and Spokane Hardware never came to an agreement as to the payment of any percentage of profits or sales. The court did not err by concluding that there was no enforceable agreement as to additional compensation to Ms. Nagyfy.
Affirm.
The majority of the panel has determined this opinion will not be printed in the Washington Appellate Reports, but it will be filed for public record pursuant to RCW 2.06.040.
BROWN and SCHULTHEIS, JJ., concur.