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FORT WASHINGTON RESOURCES v. TANNEN

March 9, 1994

FORT WASHINGTON RESOURCES, INC., Plaintiff,
v.
ROBERT H. TANNEN, PH.D., Defendant/counterclaimant, v. KIRK PENDLETON, Counterclaim defendant, and FORT WASHINGTON RESOURCES, INC., Plaintiff/counterclaim defendant.



The opinion of the court was delivered by: J. CURTIS JOYNER

 Joyner, J.

 Presently before the Court are the cross-motions for summary judgment of the parties pursuant to Rule 56 of the Federal Rules of Civil Procedure. Plaintiff, Fort Washington Resources, Inc., commenced this action in May, 1993 against Dr. Tannen seeking recovery of damages for breach of contract, negligent performance of professional services, intentional interference with prospective business advantage and conversion. Defendant then filed a counterclaim against both plaintiff and Kirk Pendleton, the Chief Executive Officer of plaintiff, alleging claims of fraudulent misrepresentation, negligent misrepresentation, libel and slander and breach of contract. Defendant now seeks summary judgment against plaintiff on all counts of plaintiff's complaint. Additionally, plaintiff and Kirk Pendleton now seek partial summary judgment with respect to all of defendant's counterclaims as well as plaintiff's claims of breach of contract and conversion.

 Facts

 On or about June 4, 1992, defendant and plaintiff entered into a consulting agreement whereby defendant was hired to aid in the preparation and filing of the IND. *fn1" During the course of defendant's employment, he submitted several proposed time and event schedules indicating what work was to be completed and when he estimated the work would be done. Included in these schedules were the dates defendant estimated the IND would be filed by. For instance, one such schedule indicated the IND would be filed in December 1992, another revised schedule indicated it would be filed in March 1993. It appears that in March 1993, plaintiff requested that defendant attend a meeting and bring all his files containing his work on the IND with him. Plaintiff alleges that this meeting was prompted by defendant's latest revised schedule which predicted that the IND would not be filed until August or September 1993. Defendant refused to attend the meeting and to turn over his files to plaintiff. Thereafter, on April 2, 1993, plaintiff terminated defendant. Additionally, the IND was not filed by the April 15 deadline.

 Standard

 In considering a motion for summary judgment, the court must consider whether the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, show there is no genuine issue as to any material fact, and whether the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c). The court is required to determine whether the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986). In making this determination, all reasonable inferences must be drawn in favor of the nonmoving party. Anderson, 477 U.S. at 256, 106 S. Ct. at 2512. While the movant bears the initial burden of demonstrating an absence of genuine issues of material fact, the nonmovant must then establish the existence of each element of its case. J.F. Feeser, Inc., v. Serv-A-Portion, Inc., 909 F.2d 1524, 1531 (3rd Cir. 1990), cert. denied, 499 U.S. 921, 111 S. Ct. 1313, 113 L. Ed. 2d 246 (1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986)).

 In cases where the parties have filed cross-motions for summary judgment, each side essentially contends that no issue of material fact exists from its perspective. United States v. Hall, 730 F. Supp. 646, 648 (M.D. Pa. 1990). The court must, therefore, consider each motion for summary judgment separately. Id. Nor do the standards under which the court grants or denies summary judgment change because cross-motions are filed. Id. Each party still bears the initial burden of establishing a lack of genuine issue of material fact. Id. Such contradictory claims do not necessarily guarantee that if one party's motion is rejected, the other party's motion must be granted. See id. (quoting Rains v. Cascade Indus., Inc., 402 F.2d 241, 245 (3d Cir. 1968)).

 Discussion

 For purposes of ease, we will approach the discussion of the motions by the various claims alleged by the parties.

 A. Plaintiff's claim for breach of contract

 Plaintiff has sued defendant for breach of contract alleging that defendant failed to abide by the terms of the consultancy agreement by failing to perform his obligations thereunder. In its complaint, plaintiff states "Defendant entered into a certain contract dated June 4, 1992 with [plaintiff] as evidenced by Exhibit 'A'." Complaint, para. 33. Exhibit A is a letter dated June 4, 1992 from Mr. Pendleton to defendant and reads as follows:

 
By this letter I confirm the Fort Washington Resources, Inc. (FWR) offer for you to consult for a six-month period of time in the area of IND preparation and filing. Your compensation for this work will be $ 50,000 payable monthly in six equal payments of $ 8,333.33. In addition you will be reimbursed for all approved out-of-pocket expenses.
 
Should the IND filing be successful and we mutually agree to continue a relationship, it is our intent to offer you a position as an employee of FWR on terms and conditions satisfactory to both parties. One of these conditions would be your participation in a stock option program which will be presented for approval in the future.
 
Attached is a sheet given to me showing your participation in the shares credited to Temple University. Although the number of shares is not correct, as we have split the stock, I believe your percentage of the Temple shares is. I will however confirm this.

 Both plaintiff and defendant seek summary judgment on plaintiff's breach of contract claim. Defendant argues that summary judgment should be granted because as evidenced by the June 4 letter, there was no obligation imposed on defendant to have the IND filed by April 15, 1993, and therefore, plaintiff cannot establish any breach. Defendant essentially argues that the June 4 letter constitutes the contract between the parties, and because it is unambiguous, the Court must enforce the terms as they are written. Defendant further argues that there has been no damage by any alleged breach. Finally, defendant argues that summary judgment is warranted because it is undisputed that plaintiff made it impossible for defendant to perform his duties because it failed to adequately fund the project.

 On the other hand, plaintiff argues that it is entitled to summary judgment on its breach of contract claim. Plaintiff argues that it has established the essential elements of its claim; that a contract existed between the parties, that plaintiff paid defendant for his services, but that defendant failed to provide the product plaintiff contracted for - the IND application. In so stating, plaintiff argues that the contract consists not only of the June 4 letter, but that it is also evidenced by a letter from defendant dated March 1991, oral discussions between Mr. Pendleton and defendant, and defendant's time and event schedules. Plaintiff argues that defendant had many contractual duties as is evidenced from the contract and they were not performed by defendant as is established by his own testimony. Plaintiff further argues that the contract does not contain a term regarding its obligation to fund the project, and therefore defendant's defense of impossibility is without merit. Plaintiff also contends that at all times there was sufficient money to complete the IND filing.

 Where the written agreement purports to be the entire agreement between the parties, and the terms are unambiguous, then it must be enforced as written by the parties. Steuart v. McChesney, 498 Pa. 45, 48-49, 444 A.2d 659, 661 (1982). However, determining whether a written agreement is the entire agreement between the parties is a question of law for the court. Seidman v. American Express Co., 523 F. Supp. 1107, 1109 (E.D. Pa. 1981). Where it is shown that no single writing embodies the entire agreement between the parties, courts allow the introduction of parol evidence to add to the written agreement. Id. Likewise, it is for the factfinder to determine the contents of mixed oral and written contracts, or oral contracts alone, when there is conflicting evidence. McCormack v. Jermyn, 351 Pa. 161, 164-65, 40 A.2d 477, 479 (1945) (it is job of jury to determine terms of disputed oral contract and understanding of parties regarding those terms); Peugeot Motors v. Stout, 310 Pa. Super. 412, 456 A.2d 1002, 1005 (1983).

 It is clear that neither party is entitled to summary judgment on plaintiff's breach of contract claim because the record is rife with issues of material fact which must be determined by the factfinder. In this case, there is obviously a dispute over what constitutes the agreement itself. First, both parties contradict themselves as to whether or not the confirmation letter constitutes the contract between the parties. While defendant argues for purposes of the motion that it does, he states in his answer, deposition testimony and answers to interrogatories that the parties did not enter into a written agreement, and that the agreement was oral and based upon promises made during negotiations and during his employ at plaintiff. See defendant's answers to first set of interro-gatories, nos. 1 and 3, defendant's deposition pp. 201-02, defendant's answer to complaint §§ 9, 33. Likewise, plaintiff argues that the contract consists of both oral promises and the confirmation letter for purposes of the motion, however, it appears to suggest that the confirmation letter alone constitutes the entire contract in both the complaint and the answer to defendant's counterclaim. For instance, in response to defendant's seventh affirmative defense that the contract was not reduced to writing and violates the statute of frauds, plaintiff states that the terms of the contract are adequately evidenced by the confirmation letter. See also complaint, §§ 9, 33.

 Second, a thorough reading of the confirmation letter suggests that it does not embody the entire agreement between the parties. The language of the letter does not state that it is a contract, rather, it states that plaintiff is confirming its offer to defendant. Further, the letter merely indicates what some of the terms of the offer are. However, the letter does not clarify what defendant's exact duties are, thus suggesting that at least part of the employment contract was oral or else embodied in another document.

 Judging from the above, the confirmation letter cannot consist of the entire agreement between the parties. However, both parties admit that a contract exists, and that it was based in part, on oral promises. What the terms of that oral contract were is a question of fact for the factfinder. Furthermore, the parties dispute that defendant was obligated to file the IND by the April 15 deadline. As such, it is for the factfinder to determine whether this was a term of the contract. For these reasons, defendant's argument ...


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