Williamson v. MGS By Design , 2022 UT 40 ( 2022 )

2022 UT 40IN THE
SUPREME COURT OF THE STATE OF UTAH
LINDSIE WILLIAMSON,
Appellant,
v.
MGS BY DESIGN, INC.,
Appellee.
No. 20210800
Heard September 9, 2022
Filed November 25, 2022
On Appeal of Interlocutory Order
Fourth District, Provo
The Honorable Robert Lund
No. 210401061
Attorneys:
Michael C. Smith, Orem, for appellant
Stephen Quesenberry, Payson, for appellee
CHIEF JUSTICE DURRANT authored the opinion of the Court, in
which ASSOCIATE CHIEF JUSTICE PEARCE, JUSTICE PETERSEN,
JUSTICE HAGEN, and JUSTICE POHLMAN joined.
CHIEF JUSTICE DURRANT, opinion of the Court:
Introduction
¶1 Lindsie Williamson worked for MGS by Design, Inc. (MGS).
She alleges that MGS violated the Utah Sales Representative
Commission Payment Act (Act)1 by failing to pay commissions for
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1 Before oral argument, the parties stipulated that the 2018
version of the Act should apply to this case. We reference this
version of the Act throughout our opinion.
WILLIAMSON v. MGS BY DESIGN, INC.
Opinion of the Court
sales that she made as one of the company‟s commissioned sales
agents.
¶2 The Act governs the payment of commissions in business
relationships between principals and commissioned sales
representatives. It authorizes a sales representative to sue a principal
under its provisions.2 And it provides that, if found liable, the
principal must pay the sales representative three times the amount of
owed commissions.3 The Act also requires that a principal and a
sales representative memorialize their business relationship in a
signed writing, a copy of which the principal must provide to the
sales representative.4
¶3 Ms. Williamson claims that MGS never provided her with a
written agreement, despite her repeated requests that it do so. But
she maintains that, although the parties did not set out their
arrangement in writing, they operated under a verbal agreement.
¶4 Ms. Williamson sued MGS under the Act for failing to pay the
commissions it owed her under their purported agreement. MGS
filed a motion to dismiss, arguing that Ms. Williamson cannot
recover under the Act because there was no signed writing. The
district court granted MGS‟s motion to dismiss. We hold that the
Act‟s writing requirement is not a precondition for recovery and, in
so doing, reverse the district court‟s grant of the motion to dismiss.
Background
¶5 Ms. Williamson worked as an office manager and bookkeeper
for MGS from February 2014 to August 2018.5 She alleges that, in
2016, she and MGS verbally agreed that she would sell goods and
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2 UTAH CODE § 34-44-301(1) (2018).
3 Id. § 34-44-301(2)(a).
4 Id. § 34-44-201(1), (3).
5 This appeal arises from the district court‟s grant of MGS‟s
motion to dismiss. “When reviewing the propriety of a motion to
dismiss, we accept the factual allegations in the complaint as true
and interpret those facts and all reasonable inferences drawn
therefrom in a light most favorable to the plaintiff as the nonmoving
party.” Russell Packard Dev., Inc. v. Carson, 2005 UT 14, ¶ 3, 108 P.3d
741. Accordingly, we recite the facts as alleged in Ms. Williamson‟s
complaint.
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services for MGS as a commissioned sales agent. She further asserts
that despite her repeated requests, MGS never prepared a written
contract for the two parties to sign.
¶6 According to the complaint, MGS‟s sales manager did
maintain written standard sales prices, commission percentages, and
payment schedules that applied to all MGS‟s independent sales
agents, including Ms. Williamson.
¶7 Ms. Williamson sold over $300,000 in goods and services for
MGS between January and August 2018. She claims that under the
verbal agreement and written sales documents, she earned over
$32,000 in commissions, all of which MGS has refused to pay. As a
result, Ms. Williamson filed a complaint against MGS alleging that it
violated the Act.
¶8 The parties‟ dispute centers around Parts 2 and 3 of the Act.
Part 2 sets forth “Requirements and Prohibitions,”6 and Part 3 sets
forth “Remedies.”7 One of the requirements in Part 2 is that “[t]he
business relationship between a sales representative and a principal
shall be in a writing signed by both the principal and the sales
representative.”8 That writing must “set forth the method by which
the sales representative‟s commission is . . . (a) computed; and (b)
paid.”9 And the principal must “provide the sales representative
with a copy of the signed writing.”10
¶9 In Part 3, the Act authorizes a sales representative to sue a
principal.11 If the principal is found liable, the Act allows the sales
representative to recover three times the amount of unpaid
commissions plus attorney fees and court costs.12 Ms. Williamson
seeks such a recovery.
¶10 MGS filed a motion to dismiss, arguing that the Act bars the
claim because the parties‟ business relationship was never put into a
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6 See UTAH CODE §§ 34-44-201 to -203 (2018).
7 See id. §§ 34-44-301 to -302.
8 Id. § 34-44-201(1).
9 Id. § 34-44-201(2).
10 Id. § 34-44-201(3).
11 Id. § 34-44-301(1).
12 Id. § 34-44-301(2).
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WILLIAMSON v. MGS BY DESIGN, INC.
Opinion of the Court
signed writing, as Part 2 of the Act requires. The district court
granted the motion, and we granted Ms. Williamson‟s petition for
interlocutory appeal. We have jurisdiction under Utah Code section
78A-3-102(3)(j).
Standard of Review
¶11 “The grant of a motion to dismiss presents a question of law
that we review for correctness.”13
Analysis
¶12 The parties disagree about the meaning of section 301 of the
Act, which states, in relevant part, that “[a] sales representative may
bring a civil action . . . against a principal for failure by the principal
to comply with . . . any provision of an agreement relating to the
payment of commission.”14 MGS argues that this “agreement” must
be in the form of a signed writing for a court to consider a sales
representative‟s claim. For support, MGS relies on another part of
the Act that requires a business relationship between a sales
representative and a principal to be in a signed writing.15 Ms.
Williamson contends that, because the Act‟s writing requirement is
independent of the remedies provisions, the signed writing is not a
prerequisite for recovery. We agree with Ms. Williamson‟s reading of
the Act.
I. The Act Does Not Condition Recovery for Unpaid Commissions
on a Signed Writing
¶13 “It is well settled that when faced with a question of
statutory interpretation, „our primary goal is to evince the true intent
and purpose of the [l]egislature.‟ And „[t]he best evidence of the
legislature‟s intent is the plain language of the statute itself.‟”16 “[W]e
assume, absent a contrary indication, that the legislature used each
term advisedly according to its ordinary and usually accepted
meaning.”17 Because “we presume[ ] that the expression of one
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13 Haik v. Jones, 2018 UT 39, ¶ 9, 427 P.3d 1155.
14 UTAH CODE § 34-44-301(1)(a) (2018).
15 See id. § 34-44-201(1).
16 State v. Thurman, 2022 UT 16, ¶ 18, 508 P.3d 128 (second
alteration in original) (citations omitted).
17 Id. (citation omitted).
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[term] should be interpreted as the exclusion of another,” we “seek
to give effect to omissions in statutory language by presuming all
omissions to be purposeful.”18 And we examine the plain language
in light of the “relevant context of the statute,” which includes the
overall structure of the statutory scheme.19
¶14 Here, the Act‟s plain language unambiguously supports Ms.
Williamson‟s view that recovery under Utah Code section 34-44-301
is not conditioned on a signed writing. We base this conclusion on
the ordinary meaning of the term “agreement,” the definitions
provided in the Act, and the Act‟s structure. And because the Act‟s
text “is unambiguous and provides a workable result, we need not
resort to other interpretive tools, and our analysis ends.”20
A. The Act’s Text and Structure Support Ms. Williamson’s Reading of the
Act
¶15 Section 301 of the Act provides that a sales representative
may sue a principal for failure to comply with “any provision of an
agreement relating to the payment of commission.”21 The Act does
not define the term “agreement.” But its ordinary and usually
accepted meaning encompasses more than just written contracts.22
The term “agreement” is defined broadly as “[a] mutual
understanding between two or more persons about their relative
rights and duties regarding past or future performances.”23 Absent a
contrary indication, we assume the legislature used the term
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18Marion Energy, Inc. v. KFJ Ranch P’ship, 2011 UT 50, ¶ 14, 267
P.3d 863 (alterations in original) (citation omitted) (internal
quotation marks omitted).
19 Olsen v. Eagle Mountain City, 2011 UT 10, ¶ 12, 248 P.3d 465.
20S. Utah Valley Elec. Serv. Dist. v. Payson City, 2021 UT 68, ¶ 20,
502 P.3d 272 (citation omitted).
21 UTAH CODE § 34-44-301(1)(a) (2018).
22 See, e.g., Agreement, BLACK‟S LAW DICTIONARY (11th ed. 2019)
(“The term „agreement,‟ although frequently used as synonymous
with the word „contract,‟ is really an expression of greater breadth of
meaning and less technicality.” (quoting 2 Henry J. Stephen,
Stephen’s Commentaries on the Laws of England 5 (L. Crispin
Warmington ed., 21st ed. 1950))).
23 Id.
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WILLIAMSON v. MGS BY DESIGN, INC.
Opinion of the Court
“agreement” advisedly according to this ordinary and usually
accepted meaning.24
¶16 MGS argues there are indications, found in the Act‟s
definitions of other terms, that the legislature intended to use the
term “agreement” more narrowly. Specifically, MGS suggests that
the term “agreement” must be read in light of the term “business
relationship,” which the Act defines as “an agreement that governs
the relationship of principal and sales representative.”25 MGS also
correctly points out that the existence of a business relationship
triggers jurisdiction under the Act.26
¶17 But the Act‟s definition of “business relationship” uses the
broad term “agreement” and omits mention of a signed writing. So
the definition of “business relationship” itself does nothing to
narrow the term “agreement” in section 301 to anything other than
its ordinary and usually accepted meaning.
¶18 MGS points us next to another section of the Act that states,
“The business relationship between a sales representative and a
principal shall be in a writing signed by both the principal and the
sales representative.”27 MGS argues that because a business
relationship “shall be in a writing”—and because the existence of a
business relationship triggers jurisdiction under the Act—the
“agreement” referred to in section 301 must be a signed writing. But
MGS conflates the definition of “business relationship” with this
separate writing requirement. In fact, the Act‟s writing requirement
presumes that the business relationship already exists.28 And it says
that this preexisting relationship “shall be in a writing”—not that it
shall be created by a writing.29 So, as the Act is written, a business
relationship arises and jurisdiction is triggered once there is an
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24 See supra ¶ 13.
25 Id. § 34-44-102(1).
26 See id. § 34-44-103(1) (“An action under this chapter may be
brought against a principal in a court of this state if . . . the principal
enters into a business relationship in this state with a sales
representative to solicit orders for a product or a service . . . .”).
27 Id. § 34-44-201(1).
28 See id.
29 Id. (emphasis added).
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“agreement”—broadly speaking—“that governs the relationship of
principal and sales representative.”30 Just because the parties fail to
reduce their relationship to a signed writing in compliance with the
writing requirement does not mean that no relationship exists. We
decline to incorporate the Act‟s writing requirement into the
definition of “business relationship” where the legislature chose not
to define it that way.
¶19 The Act‟s structure further supports our determination that
recovery for unpaid commissions is not conditioned on a signed
writing. Subsection 301(1) provides a sales representative with three
options for relief under the Act. First, a sales representative may
bring an action against a principal for failure to comply with “any
provision of an agreement relating to the payment of commission.”31
Second, a sales representative may bring an action against a
principal for failure to pay all commissions due to the sales
representative in accordance with the writing required by section 34-
44-201.32 Third, a sales representative may bring an action against a
principal for failure to comply with its obligations when the parties‟
business relationship terminates.33
¶20 The parties disagree about the meaning of the first two
options for relief. Ms. Williamson points out that only the second
option mentions the required writing. She argues that the term
“agreement” described in the first option must encompass more than
just the required writing; otherwise, the provision would be
rendered superfluous because the second option already provides
relief “in accordance with” the required writing. According to Ms.
Williamson‟s reading, the first option offers relief even in
circumstances where no written agreement exists, while the second
offers relief in accordance with the required writing.
¶21 MGS offers a different reading of the first two options for
relief. It asserts that the term “agreement” described in the first
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30 Id. § 34-44-102(1); see id. § 34-44-103(1).
31 Id. § 34-44-301(1)(a).
32 See id. § 34-44-301(1)(b) (allowing a sales representative to sue
for a principal‟s failure to comply with Utah Code section 34-44-
202(1)).
33 See id. (allowing a sales representative to sue for a principal‟s
failure to comply with Utah Code section 34-44-202(2)).
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WILLIAMSON v. MGS BY DESIGN, INC.
Opinion of the Court
option does in fact mean the required writing. Under MGS‟s reading,
then, both the first and second options for relief refer to the required
writing. According to MGS, the first option is broader than the
second because it encompasses any provision of an agreement relating
to the payment of commission, while the second option encompasses
only a principal‟s failure to pay all commissions due to the sales
representative. Based on this interpretation, a sales representative
could, for example, sue under the first option for a principal‟s failure
to comply with a provision requiring the principal to reimburse the
sales representative for expenses incurred while making a sale,
because such a provision is a “provision of an agreement relating to
the payment of commission.” According to MGS‟s interpretation,
this remedy would not be available under the second option because
a principal‟s breach of a contract provision about incurred expenses
is separate from its failure to pay all commissions due to the sales
representative.
¶22 This interpretation would render the second option for relief
superfluous. If, as MGS suggests, the first option required a writing,
then a sales representative could use it to obtain relief for a
principal‟s failure to pay all commissions due to the sales
representative in accordance with the writing required by section 34-
44-201. Yet this is the same remedy that the second option provides.
¶23 MGS acknowledges that under its reading, the first option
for relief is broad enough to encompass the relief provided by the
second option. It nevertheless contends that the legislature chose to
take a belt-and-suspenders approach by offering two separate
options for the same relief. But this explanation ignores a
fundamental principle of statutory interpretation. When interpreting
a statute, “we seek to render all parts [of the statute] relevant and
meaningful, and we accordingly avoid interpretations that will
render portions of a statute superfluous or inoperative.”34 Because
Ms. Williamson‟s interpretation renders all three options for relief
relevant and meaningful, while MGS‟s interpretation renders
portions of the remedies provisions superfluous, we adopt Ms.
Williamson‟s interpretation.
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34 Hall v. Utah State Dep’t of Corr., 2001 UT 34, ¶ 15, 24 P.3d 958(citations omitted) (internal quotation marks omitted).
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B. MGS’s Other Arguments Are Unavailing
¶24 Although MGS makes additional arguments in support of its
reading of the Act, none of them changes our view.
¶25 First, MGS suggests that because the Act allows for treble
damages—a “hefty penalty”—“it makes sense that the legislature
wanted the business relationship between the two parties to be in
writing.” Although this explanation is plausible, MGS provides no
textual support for its claim. Moreover, as Ms. Williamson
emphasizes, if the legislature were to condition treble damages on a
written agreement, a principal would be incentivized not to put an
agreement with a sales representative into writing. If a sales
representative were prohibited from obtaining remedies under the
Act absent a signed writing, then a principal could avoid having to
pay treble damages, plus the sales representative‟s attorney fees and
court costs, by refusing to memorialize the parties‟ agreement in
writing. MGS‟s motion to dismiss underscores this point. By moving
to dismiss Ms. Williamson‟s claim, MGS is attempting to sidestep
liability under the Act through its failure to comply with the writing
requirement.
¶26 Second, MGS argues that Ms. Williamson‟s reading fails to
harmonize the various sections of the Act, and that section 301
cannot be read separately from the writing requirement. “When
considering statutes relating to the same subject matter, we attempt
to construe them in harmony, . . . such that effect is given to every
provision in all of them.”35 But Ms. Williamson‟s reading presents no
harmony problem, as the Act‟s plain language allows effect to be
given to every provision without the extra step of grafting the
writing requirement onto section 301. The Act can, in one section,
require business relationships to be in writing, while also holding
principals accountable for their promises where there is no writing.
¶27 Finally, both parties cite records from the legislative history
in support of their respective readings of the Act. We do not consider
these arguments, because the Act‟s text is unambiguous and
provides a workable result.36
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35 I.M.L. v. State, 2002 UT 110, ¶ 26, 61 P.3d 1038 (citations
omitted) (internal quotation marks omitted).
36 See S. Utah Valley Elec. Serv. Dist. v. Payson City, 2021 UT 68,
¶ 20, 502 P.3d 272; supra ¶ 14.
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WILLIAMSON v. MGS BY DESIGN, INC.
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II. We Deny Ms. Williamson‟s Request for Attorney Fees
¶28 Ms. Williamson requests that we order MGS to pay the cost
of her attorney fees incurred by this appeal. The Act provides that
where a principal “is found liable” for failure to pay commissions, it
“is liable to the sales representative for . . . reasonable attorney
fees.”37 In this appeal, we do nothing more than reverse the district
court‟s grant of MGS‟s motion to dismiss. So because MGS has not,
at least at this point, been found liable under the Act, we reject Ms.
Williamson‟s request for attorney fees.
Conclusion
¶29 We conclude that under the Act‟s plain text, the writing
requirement is not a prerequisite for a sales representative to sue a
principal under the Act. Because Ms. Williamson alleged in her
complaint that MGS agreed to pay commissions to her but failed to
do so, we reverse the district court‟s grant of MGS‟s motion to
dismiss. Finally, we reject Ms. Williamson‟s request for attorney fees
because MGS has not, at this point, been found liable under the Act.
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37 UTAH CODE § 34-44-301(2)(b) (2018).
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