July 16, 2008
JOHN MALTESE, MISTER MESSAGE, M&M CONSULTING A/K/A MQM CONSULTING AND TERRES TECHNOLOGY, PLAINTIFFS-APPELLANTS,
CONSULTEDGE, INC., DEFENDANT-RESPONDENT.
On appeal from Superior Court of New Jersey, Law Division, Morris County, No. DC-7847-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 14, 2008
Before Judges Wefing and Parker.
Following a bench trial, the trial court entered a judgment dismissing plaintiffs' complaint and entering a judgment of $8,250 on defendant's counterclaim.*fn1 The trial court later denied plaintiff's motion for reconsideration. Plaintiff has appealed. After reviewing the record in light of the contentions advanced on appeal, we affirm in part and reverse in part.
Maltese is in the technology staffing industry; he would locate employees for businesses which needed to fill a position on their staffs and, in return, would receive a fee computed as a percentage of the salary of the new employee. In October 2005 Maltese entered a contract with defendant Consultedge that contained the following pertinent provisions:
. . . The fee due . . . will be 15% of the total base salary. The total fee is due on the start date of candidate, net 15 days. Provided the invoice is paid in-full in accordance with our schedule of service charges within fifteen (15)-calendar days of the candidates start date, M&M extends a ninety (90) calendar day candidate replacement guarantee.
If the candidate is no longer employed by your company on the ninetieth (90th) calendar day, from start date, M&M will replace the candidate at no charge to your company. . . Our fee is due on the candidate start date. The fee is due for the sourcing, interviewing, screening and referring a candidate that starts a position within your company.
Maltese referred Joseph Camarata to defendant, and defendant hired Camarata on or about November 21, 2005. The parties dispute when Camarata commenced his employment with defendant. Plaintiff asserts Camarata started on Monday, November 22, 2005, while defendant contends Camarata started on Tuesday, November 29, 2005.
Plaintiff forwarded his invoice, which defendant received on December 1, 2005. The invoice indicated a November 29, 2005, start date and was in the amount of $8,250. At the bottom of the invoice was the following:
Make all checks payable to: MQM Consulting, Inc. (formerly known as Mister Message) Total due in 15 days. Overdue accounts subject to a service charge of 1% per month.
On Friday, December 16, 2005, defendant forwarded its check for $8,250 to plaintiff.
Because defendant was not satisfied with Camarata's performance, it terminated him on Monday, February 27, 2006, and notified plaintiff that it had done so. Plaintiff referred another prospective employee to defendant, Sean Reilly. On March 24, 2006, Noel Gibson, defendant's sales director, sent an e-mail to plaintiff thanking him for "Joe Camarata's replacement." Reilly started working for defendant on March 27, 2006, and on April 16, 2006, plaintiff forwarded an invoice for $7,500 for his recruiting fee.
Defendant protested the invoice, contending that Reilly was a replacement candidate for Camarata, for which no fee was due under the parties' contract. Plaintiff denied this, and asserted he was entitled to payment because defendant had not paid the recruiting fee for Camarata within fifteen days of his start date.
Defendant was also unsatisfied with Reilly's development and performance. It terminated him on June 15, 2006.
In September 2006 plaintiff filed suit for his fee for placing Reilly with defendant. Defendant counterclaimed for return of the fee it had paid in connection with Camarata's placement. As we noted at the outset of this opinion, the trial court found for defendant both on the complaint and the counterclaim, finding it had no responsibility to pay a fee for Reilly's placement and that it was entitled to a return of the fee it had paid for Camarata's placement.
Plaintiff asserts on appeal, as he did to the trial court, that defendant was not entitled to invoke the ninety-day replacement provision in the parties' contract because defendant had not complied with the condition precedent to that provision, payment within fifteen days of the employee's start date. He also asserts that the contract required that a candidate be terminated within ninety days of hiring for the employer to be entitled to a free replacement candidate and that defendant had terminated Camarata beyond that ninety-day window.
Defendant, on the other hand, contends that it did pay in a timely fashion and further that its obligation to pay any fee was conditioned upon it retaining a candidate plaintiff had forwarded; it argues that since it had to terminate both individuals recruited by plaintiff, it is entitled to return of the initial fee it paid.
Where the terms of a contract are clear and unambiguous, "there is no room for interpretation or construction and the courts must enforce those terms as written." Karl's Sales & Serv. v. Gimbel Bros., 249 N.J. Super. 487, 493 (App. Div.), certif. denied, 127 N.J. 548 (1991). The courts must refrain from making a better contract for the parties or from altering it for the benefit of one party to the detriment of the other. Ibid. "[W]here an ambiguity appears in a written agreement [however], the writing is to be strictly construed against the party preparing it." Ibid. Although "'a contractual provision should generally be construed narrowly against its drafter . . . the construction should be sensible and in conformity with the expressed intent of the parties.'" Ibid. (quoting Broadway Maintenance Corp. v. Rutgers, 90 N.J. 253, 271 (1982)).
Here, the contract, drafted by plaintiff, contains three separate provisions on the payment's due date. The second paragraph states, "The fee due to M&M will be 15% of the total base salary. The total fee is due on the start date of candidate, net 15 days." The third paragraph provides, "Provided the invoice is paid in-full in accordance with our schedule of service charges within fifteen (15)-calendar days of the candidates [sic] start date, M&M extends a ninety (90) day calendar candidate replacement guarantee." The fourth paragraph states, "Our fee is due on the candidate start date." Yet another reference to the payment's due date is contained on the invoice which plaintiff forwarded after it placed Camarata for the invoice clearly stated, "Total due in 15 days."
Defendant contends that as a result of these multiple provisions, the contract is ambiguous. It asserts that between the contract and the invoice, there are four possible interpretations of when plaintiff's fee was due: on the candidate's start date; within fifteen days of the candidate's start date; within fifteen days of the date of the invoice; or within fifteen days of the date defendant received the invoice.
We do not find it necessary to resolve the question of Camarata's starting date with defendant because we agree with the trial court that the fifteen-day period for payment did not start until defendant received plaintiff's invoice. That, the parties agreed, occurred on December 1, 2005.
Courts do not sit in a vacuum, and judges are not called upon to close their eyes to the realities of conducting a business. We consider it entirely appropriate for the trial court to have recognized that a business will not remit payment until it has received a bill, for it is only at that point that the amount of the obligation is set. It would not be unheard of, for instance, for a company to give a discount to a new customer to encourage future business. Nor would it be unheard of for an invoice to reflect a discount if payment were made within a shortened period. Further, in the instance of a corporation, management must be able to demonstrate to the shareholders that it is only paying proper obligations. If payment were to be made in advance of the invoice, the transaction could be subject to question.
Defendant issued its check on December 16, 2005. That is within fifteen days of the invoice date, and defendant was thus entitled to invoke the provision of the contract entitling it to a replacement candidate free of charge.
Plaintiff argues that even if the trial court were correct in this regard, defendant was not entitled to a replacement candidate free of charge because defendant did not terminate Camarata within ninety days. He asserts that the trial court erred in computing the ninety-day period because it did not utilize ninety calendar days but rather turned to Rule 1:3-1 to determine the expiration of the ninety days. We disagree.
In doing its calculations, the trial court started with November 28, 2005, the date defendant asserted Camarata started his employment. Ninety days from November 28, 2005, was February 26, 2006, which happened to fall on a Sunday. Camarata was terminated on Monday, February 27, 2006. Plaintiff argues that even utilizing defendant's start date, Camarata was terminated on the ninety-first day, and thus defendant was not entitled to a free replacement candidate.
We agree with the trial court that defendant did not lose the benefit of the ninety-day provision because it terminated Camarata on Monday, February 27, 2006, rather than on Sunday, February 26, 2006. In doing so, the trial court implicitly employed the principle of the next-business-day, which has been utilized on various occasions by our courts. Judge Pressler collected the cases to that effect in Vuarnet Footwear v. Sea-Rail Serv., 334 N.J. Super. 442, 453-55 (App. Div. 2000).
Because defendant acted in a timely manner, both in paying its initial fee and in terminating Camarata, it was entitled to receive a replacement candidate at no charge. Thus the trial court correctly found for defendant on plaintiff's complaint seeking to be paid a placement fee for Reilly.
We are unable to agree, however, that defendant is entitled to a refund of the fee it paid in connection with Camarata's placement. By directing such a refund, the trial court, in essence, rewrote the contract between the parties and inserted the equivalent of a money-back guarantee. Plaintiff did not undertake, however to provide such an assurance to defendant. He merely agreed that in the event the candidate was not successful and had to be terminated within ninety days, he would provide a replacement candidate at no charge. Entering judgment for defendant on plaintiff's complaint, absolving it of responsibility for paying for Reilly's placement, gives defendant the full benefit of its bargain. Ordering that plaintiff refund the fee he earned through placing Camarata gives defendant more than it bargained for in its contract. "[I]t is not the function of the court to make a better contract for the parties, or to supply terms that have not been agreed upon." Graziano v. Grant, 326 N.J. Super. 328, 342 (App. Div. 1999).
The order under review is affirmed in part and reversed in part; the matter is remanded to the trial court for entry of a corrected judgment.