Vaught v Carolina Neurosurgical Svcs., (02-1153) 08/19/2003

Appeal by plaintiff from judgment entered 12 June 2002 by Judge Gregory A. Weeks in Cumberland County Superior Court. Heard in the Court of Appeals 14 May 2003.

McCoy, Weaver, Wiggins, Cleveland & Raper, P.L.L.C., by Rodney B. Davis, for plaintiff-appellant.

Maupin, Taylor & Ellis, P.A., by Thomas A. Farr and Gretchen W. Ewalt, for defendant-appellants.

    HUDSON, Judge.

    Plaintiff Kevin A. Vaught, M.D., completed his residency at the University of Tennessee at Memphis, and began a job search in the spring or summer of 1998. Through a friend, Dr. Vaught learned about an opening at defendant Carolina Neurosurgical Services, P.C. (“CNS”), and expressed an interest in it. The two shareholders of CNS, defendants Carol M. Wadon, M.D. and Bruce Jaufmann, M.D., interviewed Dr. Vaught on two occasions.
    During the interview process, Drs. Wadon and Jaufmann discussed the terms of Dr. Vaught's potential employment. Drs. Wadon and Jaufmann informed Dr. Vaught that he would be paid asalary, and that he could receive a bonus based upon the amount he collected minus his overhead expenses. Dr. Vaught agrees that neither Drs. Wadon or Jaufmann guaranteed that he would receive a bonus. Dr. Vaught did not demand a guaranteed bonus as a condition of accepting a position with CNS.
    After the interviews, Dr. Wadon offered Dr. Vaught a position with CNS, and Dr. Vaught accepted. CNS then forwarded Dr. Vaught a draft employment agreement. The draft agreement sent to Dr. Vaught did not mention a bonus. Dr. Vaught asked a friend with a law degree to review the proposed employment contract. In a 7 October 1998 letter written by Dr. Vaught to CNS, Dr. Vaught stated that after “careful review of [CNS's] proposed employment contract, . . . [he found] it acceptable in its present form,” with only one exception, that a paragraph be added to the agreement specifying that he would continue to receive compensation in the event he was required to serve in the armed forces. By letter 13 October 1998, Dr. Wadon returned the agreement to Dr. Vaught, revised to include the requested language concerning continued pay during military service. In her letter, Dr. Wadon suggested that Dr. Vaught “have [his] legal counsel look [over the agreement] and if all is satisfactory to you, please sign all three copies.”
    Dr. Vaught signed the revised agreement. The final draft of the agreement provides in pertinent part as follows:
    3. COMPENSATION

        A. DURING EMPLOYMENT TERM.

    From the commencement of the employment term of June 28th, 1999 through July 1st, 2000, (the employment term),the Doctor shall be paid a salary at the rate of $15,800.00 per month.

        B. AFTER EXPIRATION OF EMPLOYMENT TERM.

    If the Doctor remains in the employment of the corporation after expiration of the employment term ending on July 1st, 2000, without becoming a stockholder of the Corporation, until he becomes a stockholder in the Corporation the terms of his/her employment and his/her compensation from said employment shall be no less than his salary as provided for in paragraph “A” above of $15,800.00 per month plus such additional compensation as is mutually agreed to in writing between the Doctor and the Corporation at that time.

    . . .

    11. TERM. The Doctor's employment hereunder shall begin on June 28th, 1999 and shall continue through July 1st, 2000, unless terminated as herein provided, but may be terminated at any time by mutual agreement or by either party giving not less than ninety days written notice to the other party specifying the date of termination.

    . . .

    17. ENTIRE AGREEMENT. This Agreement constitutes the entire understanding of the parties. It may be changed only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification, extension or discharge is sought.

    Dr. Vaught began work on 28 June 1999. During Dr. Vaught's employment, CNS paid bonuses to him in December 1999, June 2000, and December 2000. On 1 July 2000, Dr. Vaught's one-year employment term expired, at which time CNS offered Dr. Vaught the opportunity to become a shareholder in the corporation. Dr. Vaught declined the opportunity to become a shareholder, but continued working at CNS. The parties did not amend or modify the 1999 agreement in any way.
    In April 2001, Dr. Vaught informed Drs. Wadon and Jaufmann of his intent to leave CNS, and CNS reminded Dr. Vaught that under the1999 Agreement he was required to provide ninety days notice prior to leaving. Dr. Vaught acknowledged this requirement, and agreed to work the full ninety days in accordance with the Agreement, stating that his resignation would be effective 5 July 2001.
    At the same time, Dr. Vaught demanded that he be paid his salary for the entire month of July 2001, and also inquired of Dr. Wadon whether he would receive another bonus before he left CNS. In accordance with the Agreement, CNS paid Dr. Vaught his entire salary for July 2001, but refused to give him another bonus.
    On 28 August 2001, Dr. Vaught filed a complaint alleging breach of contract and fraud due to CNS's refusal to pay him another bonus prior to his resignation. On 28 May 2002, after discovery, defendants moved for summary judgment. On 12 June 2002, Judge Gregory A. Weeks granted defendant's motion for summary judgment. From that order, plaintiff appeals.

    Summary judgment is appropriate if “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law.” G.S. § 1A-1, Rule 56(c) (2001). The purpose of the rule is to avoid a formal trial where only questions of law remain and where an unmistakable weakness in a party's claim or defense exists. Dalton v. Camp, 353 N.C. 647, 650, 548 S.E.2d 704, 707 (2001). Our Supreme Court has instructed that:
        an issue is genuine if it is supported by substantial evidence, which is that amount ofrelevant evidence necessary to persuade a reasonable mind to accept a conclusion. Further, . . . an issue is material if the facts alleged would constitute a legal defense, or would affect the result of the action, or if its resolution would prevent the party against whom it is resolved from prevailing in the action.

Liberty Mut. Ins. Co. v. Pennington, 356 N.C. 571, 579, 573 S.E.2d 118, 124 (2002) (citations and internal quotations omitted).
    “When considering a motion for summary judgment, the trial judge must view the presented evidence in a light most favorable to the nonmoving party.” Dalton, 353 N.C. at 651, 548 S.E.2d at 707 (2001). “All inferences of fact must be drawn against the movant and in favor of the nonmovant.” Roumillat v. Simplistic Enters., Inc., 331 N.C. 57, 63, 414 S.E.2d 339, 342 (1992).
    In a contract case like this one, the court interprets the contract according to the intent of the parties. Bueltel v. Lumber Mut. Ins. Co., 134 N.C. App 626, 631, 518 S.E.2d 205, 209 (1999), disc. review denied, 351 N.C. 186, 541 S.E.2d 709 (1999). “[W]hen a contract is in writing and free from any ambiguity which would require resort to extrinsic evidence, or the consideration of disputed fact, the intention of the parties is a question of law.” Bicycle Transit Authority v. Bell, 314 N.C. 219, 227, 333 S.E.2d 299, 304 (1985) (citations omitted). “Whether or not the language of a contract is ambiguous or unambiguous is a question for the court to determine.” Piedmont Bank & Trust Co. v. Stevenson, 79 N.C. App. 236, 240, 339 S.E.2d 49, 52, affirmed, 317 N.C. 330, 344 S.E.2d 788 (1986). In resolving this question, the court gives words “their usual and ordinary meaning and all the terms of theagreement are to be reconciled if possible.” Id.
    Here, the 1999 Agreement provides in pertinent part that: CNS “shall” employ Dr. Vaught for his first year; CNS “shall” pay Dr. Vaught $15,800.00 per month for that first year; and that CNS “shall” continue to pay Dr. Vaught $15,800.00 per month if he chooses to keep working for CNS after the first year without becoming a shareholder of CNS. The Agreement also provides that CNS and Dr. Vaught can agree in writing to provide Dr. Vaught “additional compensation” if he continues working after his first year. There is nothing in the Agreement that requires CNS to pay Dr. Vaught this additional compensation either during the first year of employment of afterwards. The contract unambiguously provides (1) that the “employment term” will last one year at the end of which Dr. Vaught would be considered for a shareholder status at CNS; and (2) a guarantee that, if Dr. Vaught chose not to become a shareholder, his salary would remain the same after the employment term, unless he and CNS amended the compensation terms of the Agreement. Dr. Vaught chose to continue working for CNS at the end of his first year but elected not to become a shareholder in the corporation, and the terms of the Agreement were not amended. Thus, CNS fulfilled its obligations under the contract by employing him for one year, and paying him a salary of $15,800.00 per month at the end of his one year term when he chose not to become a shareholder, and the trial court properly granted CNS's motion.
    Affirmed.    Judges TIMMONS-GOODSON and STEELMAN concur.
    Report per Rule 30(e).

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