Opinion
Case No.: 99-CV-70112-DT
August 12, 2002
MEMORANDUM OPINION AND ORDER
This matter is before the Court on Plaintiffs Motion for Reconsideration of this Court's Memorandum Opinion and Order dated February 13, 2002. Having duly considered the arguments presented in Plaintiffs Brief in Support of the above mentioned motion, the Court DENIES Plaintiffs request for the following reasons.
I. FACTS
On or about September 22, 1999, the parties to this action entered into a Sefflement Agreement ("Agreement") whereby Defendant, Certified Tool Manufacturing Corporation ("Defendant" or "Certified") agreed to continue to pay Plaintiff, MLW Associates Incorporated ("Plaintiff" or "MLW") a "commission fee equal to three and one-quarter percent (3.25%) of `net sales by Certified' as the term `net sales' has been defined and adopted by the parties by their past actions, of the parts identified on Exhibit A hereto (the `Parts'), any successor part to a Part (also a `Part'), and/or any other part number identifying a Part (also a "Part'), the sale of which was procured by MLW, payable as hereinafter set forth." See Pl.'s Mot. for an Order to Enforce Settlement Agreement, Ex. A, at 2, ¶ 1 (hereinafter referred to as "Pl.'s Initial Mot.").
On September 10, 2001, Plaintiff filed a Motion to Enforce Settlement Agreement, alleging that, "[i]n violation of its commission payment obligations under the Agreement, Certified ha[d] failed to pay MLW commissions on all three categories of parts described above." See Pl.'s Brief in Support of its Motion for an Order to Enforce Settlement Agreement, at 1 (hereinafter referred to as "Pl.'s Initial Br."). Specifically, Plaintiff claimed that Defendant had underpaid commissions on the Parts listed in Exhibit A and has filed the present motion to recover $45,299.00. Plaintiff also requested that this Court order Certified to provide MLW with additional documentation to allow MLW to make an accurate determination as to whether it was the procuring cause of Certified's sale(s) of those parts and determine the amount of unpaid commissions due MLW.
Plaintiff attached Exhibits B, C and D to its Brief in Support of its Motion for an Order to Enforce Settlement Agreement. Exhibit B listed part numbers identifying parts listed on Exhibit A to the Agreement and/or their successor parts presently in production. See Pl.'s Initial Mot. at 2, ¶ 5. Exhibit C purported to be a list of part numbers identifying parts, the sale of which were procured by MLW on behalf of Certified presently in production. Id. at ¶ 6. Exhibit D listed part numbers, the sale of which MLW believed to have been procured by MLW on behalf of Certified and which are presently in production. Id. at ¶ 7. Plaintiff stated that it "ha[d] been unable to accurately determine whether it was the procuring cause of the sale of the parts listed on Exhibit D because Certified hard] failed to provide, and/or make available to MLW the necessary documentation as set forth in the Agreement." Id.
MLW alternatively requested that this Court grant it an evidentiary hearing to allow it to provide additional proofs relating to the sale of the parts identified and listed in Exhibits B and C, and to determine whether the parts identified and listed on Exhibit D were parts, the sale of which were procured by MLW on behalf of Certified. Pl.'s Br. at 2. On February 23, 2002, the Court denied Plaintiffs motion in its entirety.
When initially referring to the Settlement Agreement in the Plaintiffs Motion, Plaintiff added the phrase "on behalf of Certified" to the third-prong of the Agreement which made the provision read "any other part number identifying a part' the sale of which was procured by MLW on behalf of Certified." This court found that the addition of this phrase rewrote the definition of the term "Part" to include all parts for which sale was procured by MLW on behalf of Certified. This court went on to say that this new interpretation of the Agreement's third prong effectively negates the first and second prongs "because the parts encompassed by the first and second prongs would be subsets of those encompassed by the third prong and subsumed thereby." See Def's Resp. Br. at 11. Only fraud or mutual mistake, neither of which the Plaintiff alleges, justifies the reformation of a tenable settlement agreement. Brown v. County of Genesee, 872 F.2d 169, 174 (6th Cir. 1989). Therefore this court held that the Plaintiffs unilateral mistake was not enough to reform the agreement and subsequently denied the Plaintiffs Motion to Enforce Settlement on February 13, 2002.
On March 13, 2002, the Plaintiff filed a Motion for Reconsideration of the Court's February 13, 2002 Memorandum Opinion and Order. Plaintiff now advances the idea that "inartful briefing by Plaintiff and misleading arguments by Defendant" caused the Court's order to contain "a palpable defect — the correction of which results in both parties receiving what they bargained for in their September 22, 1999 Settlement Agreement." See Plaintiffs Motion for Reconsideration of February 13, 2002 Memorandum Opinion and Order at 1, ¶ 1 (hereinafter "Pl. Mot. for Rec."). Plaintiff further argues that the addition of the phrase "on behalf of Certified" was an ineffectual mistake that should have had no bearing on the court's interpretation of the Agreement.
Plaintiffs Motion for Reconsideration is timely filed pursuant to the Court's Order of February 27, 2002.
II. STANDARD OF REVIEW
Local Rule 7.1(g), which governs the standard for granting or denying a motion for reconsideration, states:
Generally, and without restricting the court's discretion, the court will not grant motions for rehearing or reconsideration that merely present the same issues ruled upon by the court, either expressly or by reasonable implication. The movant must not only demonstrate a palpable defect by which the court and the parties have been misled but also show that correcting the defect will result in a different disposition of the case.
See also Ososki v. St. Paul Surplus Lines Ins., Co., 162 F. Supp.2d 714, 718 (E.D. Mich. 2001).
III. ANALYSIS
A "palpable defect" is one which is "obvious, clear, unmistakable, manifest, or plain." Ososki, 162 F. Supp.2d at 718. Plaintiff argues that its Motion to Enforce Settlement Agreement was "inartfully drafted." See Pl's Mot. for Rec. at 3. Specifically, Plaintiff claims that the addition of the phrase "on behalf of Certified" to the preexisting settlement agreement represents "inartful drafting," and constitutes a palpable defect.
The additional language added by Plaintiff allowed Plaintiff to argue that, "according to the clear and unambiguous terms of the Agreement, Certified is required to pay MLW a 3.25% commission on three types of parts sold by Certified: (1) parts identified on Exhibit A to the Agreement: (2) any successor part to a part appearing on Exhibit A to the Agreement; and (3) any other part number identifying a part, the sale of which was procured by MLW on behalf of Certified." While both Defendant and the Court took notice of this addition, thereby potentially rendering the addition a palpable defect because it was "obvious, clear, unmistakable, manifest, [and] plain" to the Court and the parties, Plaintiff has not cited, and the Court has not found, authority for the proposition that a party's own "inartful drafting" may constitute a palpable defect. The Court need not decide this matter, however, because proceeding to the second prong of the reconsideration analysis, the Court determines that, even if inartful drafting may be considered a palpable defect, the Court was not misled thereby.
Michigan law requires that a contract be interpreted so that "effect and meaning is given to every word therein, if possible." See Associated Truck Lines, Inc. v. Baer, 346 Mich. 106, 110, 77 N.W.2d 384, 386 (1956). Plaintiff alleges that in carrying out its obligation to give meaning to every word in their version of the Agreement including the additional phrase, "on behalf of Certified," the court misconstrued the intent of the third prong of the Agreement. Plaintiff advances that the third prong of the Agreement is" . . . obviously a broad `catch all' which is then limited by requiring MLW to prove that these parts were "procured by MLW'." See Pl.' s Mot. for Rec. at 5, ¶ 2. Plaintiff further alleges that the difference between the third prong as opposed to the first and second prongs is that the third prong requires proof that the parts were procured by MLW whereas the first and second prongs have no such requirement. See id. at ¶ 4.
Plaintiffs arguments, while not a verbatim reiteration of those stated in their Motion to Enforce Settlement Agreement, merely seek to have the Court interpret the terms of the Settlement Agreement in accordance with Plaintiffs suggested interpretation. In this regard, Plaintiff seeks nothing more than consideration of "the same issues ruled upon by the court, either expressly or by reasonable implication." Plaintiffs Motion is DENIED on this basis.
However, even if Plaintiffs current arguments were considered by this Court, they would not be persuasive because the Court was not misled by Plaintiffs mistake or Defendant's "misleading arguments." As the Court's Memorandum Opinion and Order of February 13, 2002 indicates, the Court did not agree with either the Plaintiffs or the Defendant's opinion of the meaning of the Settlement Agreement terms. Rather, the Court construed the terms of the Settlement Agreement in accordance with Michigan contract law, i.e., the Court ascertained the intention of the parties and found that neither parties' interpretation represented the intended purposes of the terms at issue.
As stated in the previous Memorandum Opinion and Order, contract interpretation is generally considered a question of law for the court, Campbell v. Potash Corp. of Saskatchewan, Inc., 238 F.3d 792, 797 (6th. Cir. 2001), and it is the court's responsibility to determine what interpretation will prevail. Edgar's Warehouse, Inc. v. United States Fid. Guar. Co., 375 Mich. 598, 602, N.W.2d 746, 748 (1965). However, the court will not make a new contract under the guise of interpreting the previous one. Id. In applying this standard, the Court recognized the defect in Plaintiffs Motion and found that the settlement reached by MLW and Certified did not provide for commissions on the parts identified in Exhibits C and D of Plaintiffs motion to enforce judgment.
Although the Court concurred with Defendant's contention that Plaintiffs implied assertion that the term "Part" refers to all parts for which a sale was procured by MLW on behalf of Certified ignores the definition of "Part" set forth in the Settlement Agreement, the Court also disagreed with Defendant's proffered interpretation Settlement Agreement. Consequently, the Court determined that the parts listed on Exhibit B to Plaintiffs Motion are Parts under the Agreement only to the extent they are actually: (1) listed on Exhibit A of the Agreement; (2) successor parts to the parts listed on Exhibit A of the Agreement; or (3) a Part identified by any other part number pursuant to the Agreement. The Court further concluded that only the parts listed on Exhibits C and D that fit into these categories are Parts under the Agreement. These findings were not based on the defects in Plaintiffs initial brief or the "misleading arguments" of Defendants. Rather, they were based on Michigan law of contract interpretation. As such, it cannot be said that the defect served to mislead the Court.
Further, the Court is not convinced that correction of the alleged palpable defect would lead to a different disposition of this case. While Plaintiff argues that "MLW is entitled to commissions under the third prong of the Settlement Agreement for any other part number identifying a part, the sale of which was procured by MLW," see Pl's Mot. for Rec. at 6, the Court remains convinced that it has properly interpreted the terms of the original Settlement Agreement and used the interpretation most consistent with the original intent of the parties. The Court also remains convinced that Defendant has properly paid all appropriate commissions under the Settlement Agreement. Plaintiffs Motion for Reconsideration of February 13, 2002 Memorandum Opinion and Order is DENIED.
IV. CONCLUSION
Eastern District of Michigan Local Rule 7.1(g)(3) provides stringent guidelines for the circumstances under which a reconsideration of an order can occur. Plaintiff has failed to meet these guidelines.
Accordingly,
IT IS HEREBY ORDERED that Plaintiffs Motion for Reconsideration of February 13, 2002 Memorandum Opinion and Order (Docket #31, filed March 12, 2002) is DENIED.