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RJ Dunn & Associates v. Fleming Companies, 00-2399 (2001)

Court: Court of Appeals for the Fourth Circuit Number: 00-2399 Visitors: 19
Filed: Jun. 07, 2001
Latest Update: Feb. 12, 2020
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT R.J. DUNN & ASSOCIATES, INCORPORATED, Plaintiff-Appellant, v. No. 00-2399 FLEMING COMPANIES, INCORPORATED; AHOLD USA SUPPORT SERVICES, INCORPORATED, Defendants-Appellees. Appeal from the United States District Court for the District of Maryland, at Baltimore. Benson E. Legg, District Judge. (CA-99-68-L) Argued: May 9, 2001 Decided: June 7, 2001 Before WIDENER and WILLIAMS, Circuit Judges, and HAMILTON, Senior Circuit Judge.
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                        UNPUBLISHED

UNITED STATES COURT OF APPEALS
               FOR THE FOURTH CIRCUIT


R.J. DUNN & ASSOCIATES,               
INCORPORATED,
               Plaintiff-Appellant,
                v.
                                              No. 00-2399
FLEMING COMPANIES, INCORPORATED;
AHOLD USA SUPPORT SERVICES,
INCORPORATED,
              Defendants-Appellees.
                                      
           Appeal from the United States District Court
            for the District of Maryland, at Baltimore.
                  Benson E. Legg, District Judge.
                           (CA-99-68-L)

                      Argued: May 9, 2001

                      Decided: June 7, 2001

       Before WIDENER and WILLIAMS, Circuit Judges,
             and HAMILTON, Senior Circuit Judge.



Affirmed by unpublished per curiam opinion.


                           COUNSEL

ARGUED: Charles Barry Zuravin, ZURAVIN & COMAROMI,
P.A., Baltimore, Maryland, for Appellant. Stacie Eileen Tobin,
PIPER, MARBURY, RUDNICK & WOLFE, L.L.P., Baltimore,
Maryland, for Appellees. ON BRIEF: Anthony L. Meagher, Tashina
2           R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES
Gauhar, PIPER, MARBURY, RUDNICK & WOLFE, L.L.P., Balti-
more, Maryland, for Appellees.



Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).


                              OPINION

PER CURIAM:

   R.J. Dunn & Associates, Inc. ("Dunn") appeals the United States
District Court for the District of Maryland’s order granting summary
judgment to Ahold USA Support Services ("Ahold") and Fleming
Companies, Inc. ("Fleming") (collectively "Appellees"). Dunn, an
independent commercial real estate broker, initiated this civil action
after learning that Ahold had sold one of Ahold’s supermarkets to
Fleming. Dunn claims that Appellees owe it a commission on the
sale. Because we conclude that the district court did not err in finding
that Dunn had no entitlement to a commission, we affirm the district
court’s order.

                                   I.

   Because this is an appeal from the entry of summary judgment in
favor of Appellees, we accept the facts alleged by Dunn as true. Flem-
ing owns and operates supermarkets and grocery distribution centers
throughout the United States. Beginning in 1995, Dunn and Fleming
were engaged in a business arrangement whereby Dunn assisted
Fleming on a case-by-case basis in locating and leasing sites for
Fleming’s new supermarkets. Dunn typically received a commission
for its services pursuant to an individualized negotiation in each deal.

   In or about April of 1996, Dunn and Fleming discussed the idea of
forming a "strategic partnership," in which Dunn would act as Flem-
ing’s exclusive broker for its real estate acquisitions in the geographic
area covered by Fleming’s York, Pennsylvania distribution center.
           R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES               3
(J.A. at 67, 71.) Although Fleming agreed to enter into this relation-
ship, it declined to sign a formal written contract. Instead, Fleming
and Dunn operated under an informal oral understanding based upon
the terms of a written contract that Fleming had entered into with
another regional broker in another part of the country. The contract
was comprised of two parts: (1) a national agreement, which outlined
the obligations of the contracting parties; and (2) a fee schedule,
which controlled all the fees paid to the broker for its services.1

   The national agreement provided that the broker would perform
several specific duties in rendering assistance to Fleming with the
lease or purchase of supermarkets, and in Paragraph 5(a)(1), it stated
that the broker would receive commissions from the landlord or seller
rather than from Fleming. The commissions were determined by the
fee schedule attached to the agreement. The fee schedule also
required the broker to remit forty percent of any commission paid by
a landlord or seller to Fleming’s wholly owned subsidiary, Progres-
sive Realty, Inc. ("Progressive").

   For several years, Fleming and Dunn operated under their oral
agreement without difficulty. In at least eight deals, Fleming (through
Progressive) drew up deal-specific written agreements that both Dunn
and Fleming signed. Each agreement stated that (1) Dunn acknowl-
edged it was entitled to a specific brokerage commission from the
seller or lessor; and (2) Dunn agreed to pay Progressive a co-
brokerage referral fee equal to forty percent of the earned commis-
sion. In each of these deals, Dunn negotiated its commission directly
with the seller or lessor. Fleming’s subsequent contracts with the
seller or lessor would then recognize Dunn’s status as broker and
obligate the seller or lessor to pay a brokerage commission to Dunn.

                                  II.

  Ahold, a competitor of Fleming, also owns and operates supermar-
kets throughout the eastern portion of the United States. In 1998,
  1
   Although Fleming entered into this written contract with another
regional broker, it declined to sign a similar contract with Dunn. Dunn
points to the national agreement and the fee schedule as the framework
for the parties’ oral agreement.
4          R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES
Ahold sought to acquire the Giant Supermarket chain of stores, head-
quartered in Landover, Maryland. To obtain Federal Trade Commis-
sion ("FTC") approval, Ahold agreed to divest itself of nine to ten
retail supermarkets in Maryland and Pennsylvania. Ahold’s original
plan was to sell the supermarkets in two clusters — one in each state.

   Upon learning of the possible divestiture, Tom Strzelczyk, Flem-
ing’s Director of Store Development for the York Distribution Ser-
vice Area, asked Dunn to obtain additional information about the
Maryland cluster of stores that Ahold was offering for sale. In July,
on Fleming’s behalf, Dunn contacted Frank Curci, Ahold’s executive
officer in charge of the divestiture. Dunn informed Ahold about Flem-
ing’s potential interest in the supermarkets, but Ahold refused to
release information about the supermarkets without a signed confi-
dentiality agreement. Dunn obtained a copy of Ahold’s confidentiality
agreement and forwarded it to Fleming for its signature. On July 8,
1999, after Fleming had signed the confidentiality agreement, Dunn
faxed Ahold the signed agreement along with a letter stating that
Dunn expected Ahold to pay Dunn a brokerage commission of two
percent of the selling price of any supermarket bought by Fleming.

   On July 9, 1998, however, after receiving Dunn’s fax, Curci tele-
phoned Robert Dunn, the president of Dunn, and informed him that
Ahold did not utilize brokers and instead dealt directly with the buy-
ers. Curci further stated that if Dunn was entitled to a commission for
its services, it should seek such a commission from Fleming.

   On July 14, Curci sent Fleming a letter listing the Maryland cluster
of stores available for sale and informing Fleming that if Fleming
wanted to purchase the cluster, the sale must occur within three days
and without the detailed store information requested by Fleming. On
July 16, Fleming informed Curci that Fleming declined to purchase
the Maryland cluster on those terms. One week later, Fleming advised
Dunn that its negotiations with Ahold had terminated.

   In September 1998, after Ahold had failed to sell the Maryland
supermarkets as a cluster, Ahold’s CFO, Ernie Smith, began selling
individual supermarkets, some of which were part of the original
Maryland cluster and some of which were not, to different purchasers.
Smith contacted Strzelczyk directly to determine if Fleming was
           R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES               5
interested in purchasing one or more supermarkets. Smith testified in
his deposition that he called Fleming because he believed Fleming
would be approved by the FTC as an acceptable potential buyer.
Smith was aware that there previously had been contact with Fleming
about purchasing the Maryland cluster, but he did not know who had
been Ahold’s contact person at Fleming. When Smith called Fleming,
he asked for the "CEO in the York division" at Fleming and was con-
nected with Strelczyk. (J.A. at 125.)

   Ultimately, Fleming agreed to purchase one supermarket from
Ahold in Bel Air, Maryland. The supermarket that Fleming agreed to
purchase was operated by the Martin’s chain of supermarkets and had
not been included in the Maryland cluster.2 The final contract for sale
did not provide for Dunn to receive a commission.

                                 III.

   In November 1998, Dunn brought a breach of contract action
against Fleming in the Circuit Court for Baltimore County. In January
1999, Appellees removed the case to the United States District Court
for the District of Maryland. The parties filed cross-motions for sum-
mary judgment. Because the district court concluded that Dunn had
not established any entitlement to a commission, whether by contract
or in equity, it entered summary judgment in favor of Appellees on
September 30, 2000.

   Specifically, the district court rejected Dunn’s argument that Flem-
ing violated the exclusivity provisions of their oral contract because
the undisputed evidence demonstrated that Fleming did not use
another broker in purchasing the supermarket from Ahold; instead,
the parties negotiated without the use of a broker. Because the terms
of the oral agreement, as asserted by Dunn, did not require Fleming
to use Dunn as a broker on the transaction, Fleming’s decision to pro-
ceed without a broker was not a violation of the contract. The district
court also rejected Dunn’s claim that the course of dealing between
the parties entitled it to a commission from Fleming, stating that
  2
   The original Maryland cluster had included a supermarket in Bel Air,
but it was part of the Giant Supermarket chain rather than the Martin’s
chain.
6           R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES
course of dealing is an interpretative device that cannot be used to
impose additional terms to a contract.3

   Additionally, the district court found that Fleming did not breach
its duty to cooperate or its duty of good faith and fair dealing by fail-
ing to secure a commission for Dunn from Ahold. The district court
noted that these causes of action were inapplicable in the absence of
a contractual right establishing Dunn’s entitlement to a commission
from Fleming’s purchase of the Ahold supermarket. Insofar as the
oral agreement, under the terms asserted by Dunn, did not guarantee
that Fleming would use a broker in every deal or that Fleming would
insist that the seller pay Dunn a commission in every deal, neither
Fleming nor Ahold took any action that interfered with Dunn’s
asserted contractual rights.

    The district court also concluded that Dunn was not entitled to a
commission from Ahold under section 14-105 of Maryland’s real
property law, see Md. Code Ann., Real Prop. § 14-105 (1996),
because there is no indication that Ahold intended to adopt Dunn as
its agent or ratify Dunn’s claim that it was entitled to a commission.
Finally, the district court concluded that because Dunn had, at best,
little involvement in Fleming’s purchase of the supermarket, it did not
enrich either Fleming or Ahold such that it would be unjust for them
to withhold a commission.

   Dunn filed a timely notice of appeal. On appeal, Dunn claims that
the district court’s legal conclusions are erroneous.

    3
    The district court viewed Dunn as attempting to add an additional
term to their oral agreement. We note that to the extent Dunn claims it
is seeking to explain or supplement a provision rather than add an addi-
tional term, its claim nonetheless fails because it cannot point to a single
instance where it received a commission from Fleming because a seller
refused to pay or where Fleming, as a buyer, paid Dunn a commission
for any reason. Accordingly, we agree with the district court that Dunn
has failed to point to any evidence establishing that such a course of
dealing ever existed.
           R.J. DUNN & ASSOCIATES v. FLEMING COMPANIES               7
                                 IV.

   This Court reviews a grant of summary judgment de novo. Higgins
v. E.I. DuPont de Nemours & Co., 
863 F.2d 1162
, 1167 (4th Cir.
1988). Summary judgment is appropriate only if there are no material
facts in dispute and the moving party is entitled to judgment as a mat-
ter of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 
477 U.S. 317
, 322 (1986). A material fact is in dispute when its existence or
non-existence could lead a jury to different outcomes. Anderson v.
Liberty Lobby, Inc., 
477 U.S. 242
, 248 (1986). A genuine issue exists
when there is sufficient evidence on which a reasonable jury could
return a verdict in favor of the non-moving party. 
Id. Mere specula-
tion by the non-moving party cannot create a genuine issue of mate-
rial fact. Beale v. Hardy, 
769 F.2d 213
, 214 (4th Cir. 1985). The
Court must view the evidence in the light most favorable to the non-
moving party. Smith v. Virginia Commonwealth Univ., 
84 F.3d 672
,
675 (4th Cir. 1996) (en banc).

  We have reviewed the record, briefs, and pertinent case law on this
matter de novo, and we have had the benefit of oral argument. Our
careful review persuades us that the rulings of the district court were
correct. Accordingly, we affirm the grant of summary judgment to
Appellees on the reasoning set forth in the district court’s order. See
R.J. Dunn & Assocs., Inc. v. Fleming Cos., No. CA-99-68-L (D. Md.
Oct. 2, 2000).

                                                          AFFIRMED

Source:  CourtListener

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