The opinion of the court was delivered by: BY THE COURT; J. CURTIS JOYNER
In November 1976, Keystone Information Systems (Keystone) hired Shannon as an at-will salesman to sell computer systems. Keystone employed Shannon continuously for fifteen years until March 17, 1991 when Keystone discharged him because of economic hardship. At the time of his discharge, Keystone compensated Shannon on a commission-only basis.
Keystone employed a sales incentive program where each salesman agreed to an individualized plan that outlined the terms under which Keystone would pay a commission. Under Shannon's last agreement, he earned a 10% commission on each sale provided that Keystone first received a bona fide sales order and payment from the purchasing organization. The agreement took effect on February 15, 1990 and technically expired September 30, 1990.
In December 1990, Keystone notified Shannon orally and in writing of his pending termination. The letter reiterated Shannon's sales incentive agreement stating in part:
You have a 90 day reservation on your customers and prospects until March 16, 1991. . . .A bonified [sic] sales order and payments must be received by Keystone on or before March 16, 1991 before commissions are earned by you. (emphasis in original).
At the time, Shannon was trying to close a computer sale to the Raytown School District in Raytown, Missouri. He initiated the sale in the spring of 1988 and had been intimately involved in the contracting for over two years. However, as of Shannon's discharge on March 17, the contract had yet to be submitted to Raytown's school board for approval. Keystone formally settled the contract in May, 1991.
Shannon would have earned $ 55,000 had he closed the contract prior to his departure. While Shannon acknowledged that he had technically not earned the commission, he nevertheless felt that based on his time with Keystone and the effort he had placed in the Raytown contract, Keystone would probably pay him $ 35,000- $ 45,000. Keystone, however, offered Shannon $ 8,000-$ 10,000. Shannon refused the offer and filed this suit to recover the $ 55,000.
Shannon alleged that Keystone's failure to pay him a commission on the Raytown contract constituted a breach of oral contract. He argued that since his sales incentive agreement with Keystone expired in September, six months prior to his discharge, he was, by default, working under an oral contract of employment that guaranteed him a commission for a successful sale. Alternatively, Shannon alleged that Keystone planned the timing of his discharge in order to avoid paying the commission.
Now before the court is Keystone's motion for summary judgment. Keystone asserts that the sales agreement still applied to Shannon, and, under its terms, Shannon simply had not earned the right to a commission.
Since Shannon is a Pennsylvania resident and Keystone is a New Jersey corporation, we must first decide whether Pennsylvania or New ...