The holding in the court’s own words
We conclude that absent ambiguity in e ither agreement, we need not look to the other agreement—which is extrinsic eviden ce as to the first— and compare the two agreements. As to the first argument, we conclude th at the record, construe d in the light most favorable to Colsen, shows that J.P.
Quoted verbatim from the opinion — no paraphrase, nothing generated. Not yet human-reviewed. How we find the holding.
Authorities cited
Identified automatically; this list may not be exhaustive.
- Star Centers, Inc. v. Faegre & Benson, L.L.P. 644 N.W.2d 72
- Montemayor v. Sebright Products, Inc. 898 N.W.2d 623
- DLH, Inc. v. Russ 566 N.W.2d 60
- Fabio v. Bellomo 504 N.W.2d 758
- Lyon Financial Services, Incorporated, d/b/a U.S. Bancorp Business Equipment Finance Group v. Illinois Paper and Copier … 848 N.W.2d 539
- Storms, Inc. v. Mathy Construction Co. 883 N.W.2d 772
- Alpha Real Estate Co. of Rochester v. Delta Dental Plan of Minnesota 671 N.W.2d 213
- Dykes v. Sukup Manufacturing Co. 781 N.W.2d 578
- Flynn v. Sawyer 272 N.W.2d 904
- NC Properties, LLC v. Lind 797 N.W.2d 214
- Carlson v. Allstate Insurance Co. 749 N.W.2d 41
- Motorsports Racing Plus, Inc. v. Arctic Cat Sales, Inc. 666 N.W.2d 320
- Rochester Insurance v. Martin 13 Minn. 59
- Rees-Thomson-Scroggins, Inc. v. Nelson 150 N.W.2d 568
- Neumeier v. Sperzel 25 N.W.2d 651
- Spring Co. v. Holle 78 N.W.2d 315
- Rosenberg v. Heritage Renovations, LLC 685 N.W.2d 320
- Southtown Plumbing, Inc. v. Har-Ned Lumber Co. 493 N.W.2d 137
- United States Fire Insurance Co. v. Minnesota State Zoological Board 307 N.W.2d 490
- Williamson v. Prasciunas 661 N.W.2d 645
- Bates v. Armstrong 603 N.W.2d 679
- Halla v. Norwest Bank Minnesota, N.A. 601 N.W.2d 449
- Doe v. Archdiocese of Saint Paul & Minneapolis 817 N.W.2d 150
- Caldas v. Affordable Granite & Stone, Inc. 820 N.W.2d 826
- Hunt v. University of Minnesota 465 N.W.2d 88
Opinion text
This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).
STATE OF MINNESOTA
IN COURT OF APPEALS
A20-0974
Travis Colsen,
Appellant,
vs.
Bright Birch, Inc. d/b/a Bright Birch Real Estate and
d/b/a Bright Birch, a Minnesota corporation,
Respondent.
Filed March 22, 2021
Affirmed
Gaïtas, Judge
Dakota County District Court
File No. 19HA-CV-19-3191
David J. McGee, Natalie R. Walz, Tomsche, Sonnesyn & Tomsche, P.A., Minneapolis,
Minnesota (for appellant)
Seth A. Nielsen, Legacy.Law LLC, Burnsville, Minnesota (for respondent)
Considered and decided by Larkin, Pres iding Judge; Cochran, Judge; and Gaïtas,
Judge.
NONPRECEDENTIAL OPINION
GAÏTAS, Judge
Appellant Travis Colsen challenges the di strict court’s summary judgment in favor
of respondent Bright Birch, Inc. d/b/a Bright Birch Real Estate and d/b/ a Bright Birch
(Bright Birch) on Colsen’s breach-of-contract, conversion, and unjust-enrichment claims
relating to real-estate sales co mmissions. Colsen argues that the district court erred by
2
(1) determining that Bright Birch did not breach a real-estate team-member agreement and
brokerage agreement, (2) concluding that there were no genuine issues of material fact as
to whether Colsen was the procuring cause of a sale, (3) holding that a conversion claim
could not be based on money in intangible form, (4) concluding that valid contracts
precluded Colsen’s unjust-enrichment claim, and (5) denying Colsen’s motion to amend
the complaint. We affirm.
FACTS1
Overview and Background
All real-estate salespersons in Minnesota must be licensed to act on behalf of a
licensed broker and may not be licensed with more than one broker at a time. Minn. Stat.
§ 82.63, subd. 4 (2020). Real-estate salespersons can choose to work independently or to
be part of a team or group of other salespersons within their brokerage. See Minn. Stat.
§ 82.69 (2020). Team membersh ip affords certain advantages , such as assistance with
marketing and with covering individual transactions. To advertise as a team, the member
salespersons must first obtain authoriza tion from their brokerage. Minn. Stat.
§ 82.69(b)(1).
Colsen is a real-estate salesperson. He was originally li censed through RE/MAX
Advantage Plus (RE/MAX), a real-estate co mpany and brokerage. In September 2017,
Colsen joined a team—the Bright Birch Group—that RE/MAX, through its primary broker
1 The facts are derived from the summary-judgmen t record and are presented in the light
most favorable to Colsen. See STAR Ctrs., Inc. v. Faegre & Benson, L.L.P., 644 N.W.2d
72, 76 (Minn. 2002).
3
E.M., had authorized to advertise under the RE/MAX umbrella. The Bright Birch Group
was operated by Bright Birch and its lead agent N.N.
In September 2018, Bright Birch obta ined its own broker age license. The
salespersons with the Bright Birch Group, including Colsen, transferred their licenses away
from RE/MAX to Bright Birch Real Estate, also operated by Bright Birch. Colsen worked
on real-estate transactions with Bright Birch as his brokerage for about five months until
N.N. terminated his relationship with Bright Birch in February 2019. Colsen then
transferred his license back to RE/MAX.
When Colsen joined the Bright Birch Group (the team) and later Bright Birch Real
Estate (the brokerage), he entered into two separate agreements with Bright Birch. These
agreements are central to the dispute in this case.
2017 Team Agreement
On September 1, 2017, while still with the RE/MAX brokerage, Colsen entered into
a written Bright Birch Group t eam-member agreement (the team agreement) to join that
team. The signatories to the agreement were Colsen and N.N. for Bright Birch.
The team agreement specifies the duties of team members, which include that each
team member “agrees to work diligently and with his or her best efforts to sell, lease, or
rent any and all real estate listed or under contract with Bright Birch and its affiliated
broker.” The team agreement contains additi onal references to an “affiliated broker,” or
simply “the broker,” throughout, but it does not specify a particular broker for the team.
The team agreement also describes the dutie s of Bright Birch, including that “Bright
Birch agrees to assist the Team Member in developing his or her business goals and
4
objectives and to provide assistance with individual transactions as needed.” Bright Birch
also agrees to be responsible for marketing expenses, Bright Birch administrative expenses,
“for sale” signs, and email acc ount fees for team members. Under an appendix to the
agreement, team members can also receive monthly and annual bonus incentives, recruiting
incentives, and annual mentoring incentives.
As to commission payments, the team agre ement states that all payments shall be
made to team members for se rvices provided in accordance with the agreement “via a
commission split on closed transactions in accordance with the Team Member Commission
Schedule attached hereto as Appendix A.” Th e referenced appendix specifies that gross
commission—defined as the total commission from a transaction received by or paid to the
contracting parties’ broker, exclusive of broker fees—shall be split in various ways
depending on who “sourced” the lead for the transaction. Team members receive 70% of
the gross commission for individually-sourced leads (with Bright Birch receiving the other
30%), and 50% of the gross commission for Bright Birch-sourced leads (with Bright Birch
receiving the other 50%).2
Regarding contract termination, the t eam agreement specifies that it can be
terminated by either party u pon seven days written notice to the other. It contains a
provision regarding post-termination commissions that states:
Upon termination, Team Memb er shall be entitled, but not
required, to continue working with his or her clients under
contract through closing or until such contracts expire. If a
2 Though not relevant here, the appendix also specifies that team members receive 100%
of gross commissions for personal transacti ons, which are transact ions where the team
member sells or acquires real estate in his or her own name.
5
Team Member’s post-termination services to a client results in
a successful transaction closin g, Team Member shall be
entitled to the compensation set forth in Appendix A, provided
that if the Team Member disa ssociates with Bright Birch’s
broker or fails to facilitate th e transaction through closing,
Team Member shall not be entitled to a commission unless
otherwise agreed by Bright Birch.
2018 Brokerage Agreement
When Bright Birch obtained its brokerage license and Co lsen transferred his real-
estate license from RE/MAX to Bright Birc h Real Estate, the parties entered another
agreement on September 26, 2018 (the brokerage agreement ). The signatories to the
brokerage agreement were also Colsen and N.N. for Bri ght Birch. The brokerage
agreement explicitly states that it does not supersede any existing team member
agreements. Specifically, it provides:
21. ENTIRE AGREEM ENT / TEAM MEMBER
AGREEMENTS NOT IMPACTED
This Agreement, including a ny attached appendices and
incorporated policies and proced ures, is a fully integrated
agreement and reflects the entire agreement between the
parties relating to parties’ broker-agent relationship. There are
no other promises, conditions, or agreements between the
parties relating to the provision of real-estate related services,
with the potential exception of team member agreements. This
Agreement supersedes any prior written or oral agreements
between the parties, except any existing team member
agreements. Any existing team member agreement between
the parties, which govern the parties’ team-agent relationship,
is a separate agreement and shall remain in full force and effect
and governed by the terms of such separate agreement. Team
member agreements shall not be modified or impacted in any
way by this Agreement.
An appendix to the brokerage agreement also provides that “team members” are to receive
$150 per month off of their broker fees for the first year.
6
Under the brokerage agreem ent, the agent/independent c ontractor (IC) “agrees to
work diligently and with his or her best efforts to sell, lease, or rent any and all real estate
listed or under contract with Bright Birch, to solicit additional listings and clients for
purposes of effectuating real estate transactions, and to otherwise promote the Bright Birch
brand and business.”
Bright Birch, for its part, “agrees to keep its broker license in full force and effect . . .
to assist IC in IC’s work by providing advice and cooperation as possible” and also agrees
that, “[t]o the extent that IC desires further training, transaction specific assistance, or
coaching, those services may be provided to IC for an additional fe e.” “Appendix A” to
the brokerage agreement prov ides the more specific bene fits available through the
brokerage, which depend on the fee schedule that an agent selects from the “silver,” “gold,”
or “platinum” packages. Available benefits include personal website and other business-
development assistance, errors and omissions insurance, technology resources, regular
business meetings, photography and videography packages, and office rental options.
As for commissions, the brokerage agreement provides that commission payments
are to be made “on closed transactions,” after “all required paperwork has been completed
for the transaction and provided to Bright Birch” in the amount provided for by the fee
schedule that the agent selects. The “silver” package provides 90% for the agent (10% for
the brokerage), while both the “gold” and “platinum” packages provide 98% for the agent
(2% for the brokerage). Colsen selected the “platinum” fee schedule in the brokerage
agreement, resulting in a “98/2 split.”
7
The brokerage agreement may be terminated by either party for any reason and upon
written notice to the other party. As to whether an agent may receive commissions for real-
estate transactions that close after his or her departure from the brokerage, the agreement
provides:
Upon termination, all pending transactions shall remain with
Bright Birch and IC shall be responsible for payment of the
same fees and shall be entitled to the same commission as if IC
had remained associated with Br ight Birch, provided that IC
remains licensed through a licensed broker and is able to and
does continue working on the transaction through closing.
Following the termination of his relationship with Bri ght Birch, Colsen sought
commission payments for several real-estate tran sactions that closed after he left. His
complaint alleges that Bright Birch still owes him commission payments in connection
with three properties, referred to as the White Bear property , the 40th Lane property, and
the Brookwood property. The primary disp ute underlying this action regards the
Brookwood property, purchased by J.P. and S.P.
Brookwood Property and Termination of Bright Birch and Colsen’s Relationship
In early November 2018, wh ile Colsen was with Bright Birch Real Estate, J.P.
reached out to Colsen via text message and expressed that he and his wife S.P. were looking
at moving and wanted to talk . J.P. was familiar with bo th Colsen and N.N. through
personal and business connections. J.P. a nd Colsen began exchanging messages about
potential homes, with Colsen pr esenting options to J.P. They continued to do so
periodically over the next few months. In mid-December, J.P. asked Colsen for N.N.’s
8
phone number, which Colsen shared, and J.P. and Colsen continued discussing properties.3
Colsen did not have J.P. sign a written representation agreement at any point.
In late January 2019, J.P. brought up the Brookwood property to Colsen. J.P. had
initially discovered the Brookwood property through his own in ternet search, and he had
previously made an unsuccessful offer on it in the fall of 2018 w ith the assistance of a
different real-estate agent. He had noticed that it was still for sale and asked Colsen to do
some research on the property. J.P. also called N.N. sometime in January 2019 and asked
her to help with pursuing the Brookwood property. J.P. late r explained that he sought
N.N.’s assistance because Colsen was a relatively inexperienced real-estate agent, and he
wanted a more experienced ag ent involved given the high-end property at issue and his
previous unsuccessful offer.
On February 1, 2019, J.P., S.P., N.N., and Colsen all attende d a showing of the
Brookwood property. After the showing, J.P. and S.P. decided to make an informal offer
to gauge the sellers’ position be fore submitting a formal offe r. On February 7, N.N.
prepared a detailed informal offer for J.P. and S.P. N.N. sent the informal offer to J.P. and
S.P. to review, copying Colsen on the email. Two days la ter, after J.P. and S.P. had
provided feedback, N.N. sent the sellers’ agent the revised informal offer via email, again
copying Colsen.
3 There is no context for the phone number request in the text messages; Colsen simply
shared the number and the two continued disc ussing properties. Th ere is suggestion in
deposition testimony, though, that J.P. used the number to wish N.N. a happy birthday.
9
Colsen then went on vacation from Fe bruary 12 through February 18. On
February 15, 2019, Bright Birch entered a wr itten buyer-representation contract with J.P.
and S.P., with N.N. signing on behalf of Bright Birch. That same day, J.P. and S.P. signed
a purchase agreement for the Brookwood property, drafted by N.N.; the sellers signed the
agreement the next day.
When Colsen return ed from vacation on February 18, he met with E.M., the primary
broker for RE/MAX. Colsen’s work calendar, visible to his Bright Birch colleagues,
reflected that he had a meeting with E.M. N.N. had noticed this meeting at some point
while Colsen was on vacation and believed that Colsen was planning to leave Bright Birch
and return to RE/MAX. When N.N. asked Co lsen about the meeting, he initially seemed
to deny that it occurred. But then he told her he was soliciting a donation from RE/MAX
for his brother’s charity.
The same day that Colsen returned from vacation and met with E.M., he sent N.N.
an email expressing that he was “[s]uper disappointed with how [the Birchwood dealings]
shook down signing a friend/client while I was on vacation.” N.N. replied, stating that she
was “taken aback and offended at [Colsen’ s] accusation that [N.N.] stole [his]
friend/client” and noting that the meeting with E.M. was inappropriate. She notified
Colsen that she was terminati ng Bright Birch Real Estate’s relationship with him. N.N.
instructed Colsen to select a new brokerage within two days.
Colsen promptly transferre d his license back to RE/MAX . He asked J.P. to move
the Brookwood transaction over to RE/MAX, but J.P. elected to remain with Bright Birch
and work with N.N.
10
N.N. continued working on the Brookwood transaction, and her services ultimately
included completing the purchase agreement, negotiating with the seller’s agent, helping
with the inspection process, helping with the removal of contingencies in the purchase
agreement, and attending the closing. Cols en asked N.N. that the commission for the
Brookwood transaction “be handled as assigne d in [their] contract,” but Bright Birch
maintained that Cols en was not contractually entitled to commission for the transaction
and ultimately did not pay him any commission for it.
White Bear and 40th Lane Properties
Two other transactions that Colsen work ed on while at Bright Birch Real Estate
closed after his departure. Th e first, for the White Bear property, closed on February 20,
2019. Bright Birch sent Colsen a $5,425.10 commission check for the White Bear property
a few weeks later, which specified that it wa s calculated based on a 70/30 team split and
98/2 brokerage split.
The second, for the 40th Lane propert y, closed on March 27, 2019. The
administrative manager of Bright Birch emailed Colsen several times, both before and after
the closing, to notify him that documentation was missing from his file on the property that
needed to be submitted before his commission payment could issue. Bright Birch let
Colsen know, and has consistently maintained, that Colsen can receive commission for the
40th Lane transaction as soon as he submits the missing documentation.
This Lawsuit
Colsen initiated this lawsuit in April 2019, asserting four claims in connection with
allegedly unpaid commissions for the Brookwood, White Bear, and 40th Lane transactions:
11
(1) breach of contract, (2) conversion, (3) unjust enrichment, and (4) failure to pay wages
in violation of Minnesota Statute section 181.145 (2020).4 In January 2020, Bright Birch
moved for summary judgment on all the claims, arguing that the team agreement and the
brokerage agreement control th e commission at issue and th at neither agreement entitles
Colsen to any unpaid amounts. Specifically, Bright Birch asse rted that Colsen properly
received payment pursuant to the team and brokerage agre ements for the White Bear
transaction, that Colsen had not fulfilled his prerequisite contractual obligations
(completing the file documentation) to receive payment for the 40th Lane transaction, and
that Colsen has no legitimate claim—under the agreements or otherwise—to a commission
for the Brookwood transaction.
On February 3, 2020, Colsen moved to am end his complaint. He sought leave to
add “an additional five real estate transactions to his existing claims against Bright Birch”
from his time with Bright Birch Real Estate. He asserted th at Bright Birc h had taken a
share of the commissions for those transactions in accordance with both the team member
and brokerage agreements, when it should ha ve retained only a 2% share under the
brokerage agreement b ecause the team agreement no long er applied when he moved his
license to the Bright Birch brokerage.
The district court held a hearing on bo th the motion for summary judgment and
motion to amend the complaint at the end of February 2020. In May 2020, the district court
4 Colsen does not challenge on appeal the district court’s dismissal of his claim for violation
of section 181.145.
12
issued an order granting summary judgment in favor of Bright Birch on all counts, denied
Colsen’s motion to amend the complaint, and entered judgment accordingly.
This appeal follows.
DECISION
Appellate courts “review the grant of summary judgment de novo to determine
whether there are genuine issues of material fact and whether the district court erred in its
application of the law.” Montemayor v. Sebright Prods., Inc., 898 N.W.2d 623, 628 (Minn.
2017) (quotation omitted). Reviewing courts “view the evidence in the light most
favorable to the party against whom summary judgment was granted.” STAR Ctrs., Inc. v.
Faegre & Benson, L.L.P., 644 N.W.2d 72, 76-77 (Minn. 2002).
Summary judgment is proper if the movant shows, by citing to particular parts of
the record, including depositions, documents, affidavits, admissions, and interrogatory
answers, that “there is no genu ine issue as to any material fact and the movant is entitled
to judgment as a matter of law.” Minn. R. Ci v. P. 56.01, 56.03(a). A genuine issue of
material fact exists “when re asonable persons might draw different conclusions from the
evidence presented.” DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn. 1997).
A district court’s denial of a motion to am end the complaint is reviewed for an abuse
of discretion. Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993).
I. The district court did not err by dismissing Colsen’s breach-of-contract claim
on summary judgment.
To establish a claim for breach of contra ct, a plaintiff needs to show: (1) the
formation of a contract, (2) performance by pl aintiff of any conditions precedent to his
13
right to demand defendant’s perf ormance, and (3) a breach of the contract by defendant.
Lyon Fin. Servs., Inc. v. Ill. Paper & Copier Co. , 848 N.W.2d 539, 543 (Minn. 2014).
Colsen alleges that Bright Birch breached the brokerage agreement by failing to pay him
the full amount of his commissions owed for the White Bear Property, 40th Lane Property,
and Brookwood Property transactions.
To determine whether a breach of contract occurred here, the first question is which
contract or contracts govern th e disputed transactions. The district court concluded that
the team agreement and the brokerage agreemen t both apply to the transactions at issue,
and it found no ambiguity in the agreements. Colsen argues that this was an error; he
asserts that certain ambiguities in the contracts create a genuine issue of material fact as to
which agreement contro ls, and he ultimately argues that his commission splits are only
governed by the brokerage agreement. We accordingly begin by considering whether both
contracts apply, before turning to the specific allegations of breach.
A. The district court did not err by determining that there is no ambiguity
in the team member and brokerage ag reements and that both apply to
the disputed transactions.
“Whether language in a contract is plai n or ambiguous is a question of law that
[appellate courts] review de novo.” Storms, Inc. v. Mathy Constr. Co. , 883 N.W.2d 772,
776 (Minn. 2016). “When the intent of the parties can be determined from the writing of
the contract, the construction of the instrument is a question of law for the court to resolve,
and this court need not defer to the district court’s findings.” Alpha Real Estate Co. of
Rochester v. Delta Dental Plan of Minn. , 671 N.W.2d 213, 221 (Minn. App. 2003)
(quotation omitted), review denied (Minn. Jan. 20, 2004).
14
To determine the intent of parties to a co ntract, courts review the language of the
contract. Dykes v. Sukup Mfg. Co. , 781 N.W.2d 578, 582 (Minn. 2010). “When the
language is clear and unambiguous, [appellate courts] enforce the agreement of the parties
as expressed in the language of the contract.” Id. Only if the langu age is ambiguous do
courts look to “parol eviden ce,” or evidence outside th e four corners of the written
agreement, to determine the parties’ intent. Flynn v. Sawyer , 272 N.W.2d 904, 907-08
(Minn. 1978); NC Properties, LLC v. Lind , 797 N.W.2d 214, 219-20 (Minn. App. 2011).
Contract language is ambiguous “if it is susceptible to two or more reasonable
interpretations.” Carlson v. Allstate Ins. Co., 749 N.W.2d 41, 45 (Minn. 2008). But words
in a contract are not to be viewed in isolati on, and “intent is ascertained, not by a process
of dissection in which words or phrases are is olated from their context, but rather from a
process of synthesis in which the words an d phrases are given a meaning in accordance
with the obvious purpose of the contract as a whole.” Motorsports Racing Plus, Inc. v.
Arctic Cat Sales, Inc., 666 N.W.2d 320, 324 (Minn. 2003) (quotation omitted).
On appeal, Colsen contends that there ar e two ambiguities in the agreements. First,
he argues that the team agreement is ambig uous on its own as to the term “affiliated
broker,” and second, he argues that “the language of the agreements when read together is
ambiguous.” He then attempts to use the asserted ambiguities to argue that the team
agreement became impossible to perform when he entered the brokerage agreement. Given
this impossibility, he argues, the team agreement “has no effect,” and his transactions with
Bright Birch Real Estate should have been subject only to the 98/2 brokerage split and not
a 70/30 or 50/50 team split.
15
We note that Colsen’s argument largel y ignores the express language of the
brokerage agreement, which st ates that the brokerage agr eement does not affect existing
team agreements. Again, the brokerag e agreement contains a heading: “ ENTIRE
AGREEMENT / TEAM MEMBER AGREEMENTS NOT IMPACTED ,” and
specifies thereunder that “Any existing team member agreement between the parties, which
govern the parties’ team-agent relationship, is a separate agreement and shall remain in full
force and effect and governed by the terms of such separate agreement. Team member
agreements shall not be modified or impact ed in any way by this Agreement.” This
language in the brokerage agreement unambiguously expresses the parties’ intent that both
agreements would continue to apply—meani ng that Colsen would split commission with
Bright Birch in a member/team capacity (70/ 30 or 50/50) and an agent/broker capacity
(98/2)—when Colsen switched his license to the Bright Birch brokerage. Furthermore, as
the district court noted, the choice of the generic “affiliated brok er” and “the broker”
language, as opposed to “RE/MAX,” in the t eam agreement demonstrates that the parties
intended the team agreement to survive a change in the team’s brokerage.
But Colsen does not argue that the above language from the brokerage agreement is
ambiguous, and instead makes two arguments for ambiguities elsewhere in the agreements
that he contends create an impossibility of contract performance. We address the merits of
each argument in turn.
16
1. Whether the team agreement is ambiguous as to “affiliated
broker”
Colsen first argues that “[t]he langua ge of the 2017 [team] [a]greement is
ambiguous because it does not de fine ‘affiliated broker.’” He then asserts that, under a
standard dictionary definition, “affiliated” means “associated with another.” See Merriam-
Webster’s Collegiate Dictionary 21 (11th ed. 2014). Using that definition, Colsen reasons
that once he switched his license to Bright Birch Real Estate and entered the brokerage
agreement, his own performance under the team agreement became “impossible.” He
explains that this is so because the language of the team agreement requires him to engage
in real estate transactions with Bright Birch and its “affiliated broker.” (Emphasis added.)
Once Bright Birch Group’s “affiliated broker” became Bright Birch, engaging in such
transactions became impossible because Bright Birch cannot “affiliate” with itself; it must
associate with “another” in order to be “affiliated” per the dictionary definition.
After reviewing the team agreement, we di sagree with Colsen’s initial assertion that
the term “affiliated broker” in the team agreem ent is ambiguous. While Colsen contends
that “[t]he language of the [team] [a]greem ent is ambiguous because it does not define
‘affiliated broker,’” the absence of a definition in the contract does not, by itself, create an
ambiguity. Contract language is ambiguous if it is susceptible to more than one reasonable
interpretation, Carlson, 749 N.W.2d at 45, and this inquiry takes into account the “obvious
purpose of the contract as a whole.” Motorsports Racing Plus, Inc. , 666 N.W.2d at 324
(quotation omitted).
17
When read in context, th e term “affiliated broker” in the team agreement has only
one reasonable meaning. See id. (explaining that the meaning of a contract is not
ascertained “by a process of dissection in wh ich words or phrases are isolated from their
context” (quotation omitted)). The parties agree that, under Minnesota law, all real-estate
salespersons must be licensed to act on behalf of one, and only one, licensed broker. Minn.
Stat. § 82.63, subd. 4. And the only statute regarding real estate teams provides that
salespersons who are “part of a team or group within the brokerage ” must obtain
authorization from the primary broker of the brokerage in order to advertise as a team.
Minn. Stat. § 82.69 (emphasis added). These stat utes suggest that real estate agents on a
team must all be part of the same brokerage, and Colsen himself asserts that this is the case.
Consequently, the team’s “aff iliated brokerage” as used in the team agreement can have
only one meaning: the brokerage under whic h the team advertises and that holds the
members’ licenses.
Colsen proposes an alte rnative reasonable definition, which is that “affiliated
broker” refers exclusively to RE/MAX. This definition is not reasonable in the context of
the team agreement though. The parties c ould have drafted the agreement to refer
specifically to RE/MAX, but instead the agreement uses the generic “affiliated broker” or
“the broker” language. No language in the team agreement suggests that the agreement is
meant to terminate upon a change in brokers fo r the team. And, c ontrary to Colsen’s
assertions, RE/MAX did not “authorize” formation of the team, and did not otherwise take
part in the team agreement; RE/MAX merely authorized the team to advertise under its
brokerage in accordance with section 82.69. Ultimately, the language of the contract does
18
not permit the reasonable interpretation that “affiliated broker” refers exclusively to
RE/MAX.
Applying the only reasona ble definition, that Bright Birch Group’s “affiliated
broker” is the broker under which the team advertises and that hold the members’ licenses,
the “affiliated broker” when Co lsen entered the team agre ement in 2017 was RE/MAX.
When Colsen entered the brokerage agreement in 2018, though, the team’s affiliated broker
was Bright Birch—the brokerage under which the team members advertised once they
switched their licenses away from RE/MAX. Again, this is wher e Colsen asserts an
impossibility by using a dictiona ry definition of “affiliated, ” arguing that Bright Birch
cannot “affiliate” with itself.
In response to Colsen ’s impossibility argument, Bright Birch argues that nothing
prevents a business from aff iliating or doing business with another business owned or
operated by the same legal entity. In other words, nothing prevents the Bright Birch Group
real estate team from being affiliated with Bright Birch Real Estate as its brokerage. Bright
Birch contends that even the full Merriam-Webster definition that Colsen offers, which is
“closely associated with another typically in a dependent or subordinate position,” does not
support his argument. Merriam-Webster’s, supra, at 21. This definition, Bright Birch
submits, certainly captures a team working unde r a legal entity that also operates as the
team’s brokerage. 5
5 Bright Birch notes that the usage example provided with the Merriam-Webster dictionary
definition is “the university and its affiliated medical school,” which suggests that the
medical school may affiliate with the university even if the two are part of one legal entity.
See Merriam-Webster’s, supra, at 21.
19
We agree that, even appl ying the dictionary defin ition selected by Colsen, no
“impossibility” results. That definition does not prevent the Bright Birch Group from
affiliating with Bright Birch Re al Estate as its broker. A nd other dictionaries define
“affiliated” or its root word, “a ffiliate,” in ways that even mo re clearly indicate that the
term does not require two or more separate legal entities. The American Heritage
Dictionary, for example, defines “affiliate” as “to associate (oneself) as a subordinate,
subsidiary, employee, or member.” The American Heritage Dic tionary of the English
Language 28 (5th ed. 2011).
Additionally, we discern no legal or practical difficulty with defining “affiliated
broker” in the team agreement to mean the brokerage under which the Bright Birch Group
advertises and that holds the te am members’ licenses. Indeed, as the district court noted,
Colsen and Bright Birch effectively split commissions in accordance with both agreements
until Colsen transferred his license back to RE/MAX. Because “affiliated broker” is
subject to only one reasonable interpretation, and because that interpretation does not create
an impossibility, the district co urt did not err when it found that the team agreement is
unambiguous.
2. Whether the agreements are ambiguous when read together
Colsen next argues that even if the team agreement is not ambiguous on its own,
provisions of the team agreement and brok erage agreement, when read together, are
ambiguous. He points to two specific “conflicting terms” that he asserts create ambiguity:
the agreements contain different commission splits that cover all of Co lsen’s real estate
transactions, and the agreements contain different termination provisions.
20
Bright Birch argues in response that ther e is simply no reas on to look at the
agreements together to try to discern an ambi guity in either. The two agreements govern
two separate relationships: the agent-team relationship and the agent-broker relationship.
Bright Birch acknowledges that there are differences between the two, but asserts that these
are “by design” and present no problem, interpretive or otherwise.
We conclude that absent ambiguity in e ither agreement, we need not look to the
other agreement—which is extrinsic eviden ce as to the first— and compare the two
agreements. See Flynn, 272 N.W.2d at 907-08. But even if we did compare them as Colsen
suggests, the provisions do not create a conflict.
The team and brokerage agreements, under their explicit terms, govern two separate
relationships and sets of services. Accordingly, it makes sense that they contain differing
commission splits. And again, there is no practical difficulty a pplying the commission
provisions in both agreements to all of Co lsen’s transactions, as the brokerage (Bright
Birch) simply retains first, its 2% brokerage fee, and second, its split of gross commissions
under the team agreement. As to the termination provisions, the team agreement requires
7 days’ written notice to terminate while th e brokerage agreement requires only written
notice. This difference is immaterial; Colsen does not show how it makes either agreement
ambiguous or makes the two agreements im possible to perform simultaneously. Thus,
even if we read the two agreements “together,” no ambiguity or conflict results.
21
B. The district court did not err by dete rmining Colsen is not entitled to
additional commission payments under the applicable agreements.
Having determined that both the team and brokerage agreements apply to Colsen’s
commission splits for transactions conducted while he was working under Bright Birch
Real Estate, the next inquiry is whether there is a genuine issue of material fact that Bright
Birch breached the agreements. Colsen argues that he is owed additional commissions for
three transactions that closed after he separated from Bright Birch.
Under the termination provision of the te am agreement, Colsen is entitled, but not
required, to “continue working with his . . . clients under contract through closing or until
such contracts expire.” If his “post-termination services to a client results in a successful
transaction closing, [Colsen] shall be entitled to the comp ensation set forth in Appendix
A.” As a caveat, though, if Colsen “disassociates with Br ight Birch’s broker or fails to
facilitate the transaction through closing, [he] shall not be entitled to a commission unless
otherwise agreed by Bright Birch.”
Under the termination provision of the brokerage agreement, “all pending
transactions shall remain with Bright Birch and [Colsen] shall be responsible for payment
of the same fees and shall be entitled to the same commission as if [Colsen] had remained
associated with Bright Birch,” as long as Colsen “remains licensed through a licensed
broker and is able to and does continue working on the transaction through closing.”
With the applicable provisions for post- termination commission payments in mind,
we analyze each disputed transaction in turn.
22
1. White Bear transaction
The parties agree that Colsen acted as the buyer’s agent for the White Bear property
transaction, which closed on February 20, 2019. They also agree that Bright Birch issued
Colsen a check for $5,425.10 on March 4, 2019, and that the check accurately reflected the
commission splits in the team member and the brokerage agreements.
Colsen’s contention for unpaid commission on the White Bear property is simply
that Bright Birch should not have retained commission under both the team and brokerage
agreements for the transaction because th e team agreement no longer applied once he
entered the brokerage agreement. As explained above, the district court properly rejected
that argument. There is thus no genuine issue of material fact that Bright Birch paid Colsen
in full for this transaction under the applicable contracts.
2. 40th Lane transaction
The parties also agree that Colsen acte d as the buyer’s agent for the 40th Lane
property transaction, which closed on March 27, 2019. Bright Birch declined to pay Colsen
commission on this transaction until he completed the file for the transaction by submitting
missing documentation. Though not in the reco rd, the parties represent to this court on
appeal that Colsen has submitted the missing documentation and has been paid commission
for the 40th Lane prope rty in accordance with the splits in the team and brokerage
agreements. Accordingly, Colsen’s argument for this transaction is the same as the White
Bear transaction—that Bright Birch should no t have retained commission under both the
team and brokerage agreements—and it fails for the same reason.
23
3. Brookwood transaction
Colsen argues that he is entitled to a commission payment for the Brookwood
property under the brokerage agreement.6 It is undisputed that Bright Birch did not pay
Colsen any commission in c onnection with the Brookwood property. Bright Birch
contends that it did not need to, though, because Colsen is not contractually entitled to any
commission for that transaction.
Again, the brokerage agreem ent provides that, upon term ination of the agreement,
“all pending transactions shall remain with Br ight Birch and IC shall be responsible for
payment of the same fees and shall be entitled to the same commission as if IC had
remained associated with Bright Birch, provided that IC . . . is able to and does continue
working on the transaction through closing.” (Emphasis added.)
Bright Birch argues that summary judgme nt as to the Brookwood transaction was
proper, first, because even if Colsen had remained with Bright Birch, the brokerage
agreement only entitles him to commissions for his own transactions, and second, because
Colsen did not provide any post- termination services on the transaction. We agree with
Bright Birch on both accounts.
As to the first argument, we conclude th at the record, construe d in the light most
favorable to Colsen, shows that J.P. and S.P. ultimately electe d to work with N.N. rather
than Colsen as their real estate agent, and that N.N. performed all of the material work on
6 Colsen does not argue that he is entitle d to a commission paymen t for the Brookwood
property under the team agreement, as he maintains that “only the [brokerage] [a]greement
applies to [his] commissions.”
24
the Brookwood transaction. N.N. had J.P. and S.P. sign a representation agreement, drafted
the informal offer, negotiated with the seller’ s agent, completed th e purchase agreement,
helped remove contingencies from the purcha se agreement, and attended the closing.
Colsen, on the other hand, had the initial contact with J.P. and discussed various other
properties with him, and he researched the Brookwood property upon J.P.’s request and set
up a showing. But the brokerage agreement only entitles agents to payment on “closed
transactions,” and it was N.N. that performed all material aspects of and closed the
Brookwood transaction. Co lsen’s initial involv ement with J.P. and the Brookwood
property does not entitle him to a commissi on under the brokerage agreement when the
clients ultimately elected to work with another agent.
Most notably, though, it appears undis puted that Colsen did not perform post-
termination services of any kind for th e Brookwood transaction as required by the
brokerage agreement. The record shows that he asked J.P. and S.P. to move the transaction
over to RE/MAX with him as their agent, but J.P. and S.P. declined to do so and elected to
remain with N.N. Ultimately, the undisputed fa ct that Colsen provid ed no services after
leaving Bright Birch bars hi m from earning a commission on the Brookwood property
under the brokerage agreement.
Colsen’s arguments do little to cast doubt on this conclusion. He appears to concede
that he did not provide any post-terminati on services under the brokerage agreement; his
primary contention is that he could not provide post-termination services because he was
fired. He contends that, under applicable law, “[A real estate] salesperson . . . may not be
licensed to act on behalf of more than one br oker in this state during the same period of
25
time.” Minn. Stat. § 82.63, subd. 4. This provision, Colsen argues, prevented him from
working on the Brookwood transaction once he transferred his license back to RE/MAX.
Essentially, Colsen s eems to argue that in requiring post-termination services for a
commission, the Bright Birch brokerage agreem ent violates applicable law and is thus
unenforceable. See, e.g. , Rochester Ins. Co. v. Martin , 13 Minn. 59, 65 (Minn. 1868)
(explaining that an illegal contract is unenforceable). He requests that the requirement be
“severed” from the brokerage agreement, and asserts that, if it is severed, he is entitled to
a commission.
Colsen’s argument is not persuasive. Th e brokerage agreement does not contravene
the statute that Colsen cites. Under the statute, a real estate salesperson cannot be licensed
to act on behalf of more than one broker; it does not prohibit a r eal estate agent who
switches brokerages from completing a file with the permission of his or her new and old
broker. See Minn. Stat. § 82.63, subd. 4. Indeed, th e record reflects that Colsen worked
on the White Bear and 40th Lane transactions after he tran sferred his license back to
RE/MAX. Colsen has not shown that the brokerage-agreement requirements violate the
law, and accordingly has not shown that a genuine issue of material fact exists as to whether
the brokerage agreement entitles him to a commission for the Brookwood transaction.
In sum, the district court did not e rr by granting summary-judgment dismissal of
Colsen’s breach-of-contract clai m, as Colsen has not shown a genuine issue of material
fact that the applicable contracts entitle him to additional commi ssions for the three
disputed properties.
26
II. The district court did not err by determ ining that there are no genuine issues
of material fact as to whether Co lsen was the procuring cause of the
Brookwood sale.
Colsen next argues that the district cour t erred by determining that there are no
genuine issues of material fact as to whether he was the procuring cause of the Brookwood
sale. He asserts the procuring-cause doctrine as an independent basis—separate from the
contracts—for why he is entitled to commissions on the Brookwood property.
Minnesota courts have applied the proc uring-cause doctrine in the real-estate
context to hold that “[a] broker is not entitled to a commission unless he was the procuring
cause of the sale; that is, it must have been the direct result of his efforts to bring it about,
and a broker seeking to recover a commission has the burden of proving this affirmatively.”
Rees-Thomson-Scroggins, Inc. v. Nelson , 150 N.W.2d 568, 5 71 (Minn. 1967) (citing
Neumeier v. Sperzel , 25 N.W.2d 651, 653 (Minn. 1946)). 7 An agent is the “procuring
cause” of a sale if he or she “originated a c ourse of events which without a break in their
continuity created a cause of which the sale was the result.” Spring Co. v. Holle, 78 N.W.2d
315, 318 (Minn. 1956). “It is not enough that [the agent’s] services merely contributed to
the result. They must be the producing and effective means thereof.” Id.
“[T]he procuring cause doctr ine is an equitable remedy that is only available where
there is no contract remedy; that is, where commissions were not c ontractually earned at
7 While it appears that the caselaw on procuring cause in the real-estate context primarily
relates to brokers finding se llers for nonexclusive listings, see, e.g. , Rees-Thomson-
Scroggins, Inc., 150 N.W.2d at 571, we assume without deciding that the equitable doctrine
could potentially apply to agents in the event that their rela tionship with their broker for
commissions was not governed by a valid contract.
27
the time of termination [of a listing agreement].” Rosenberg v. Heritage Renovations, LLC,
685 N.W.2d 320, 330 (Minn. 2004). “It is well settled in Minnesota that one may not seek
a remedy in equity when there is an adequate remedy at law.” Southtown Plumbing, Inc.
v. Har-Ned Lumber Co., 493 N.W.2d 137, 140 (Minn. App. 1992). Specifically, “equitable
relief cannot be granted where the rights of th e parties are governed by a valid contract.”
U.S. Fire Ins. Co. v. Minn. State Zoological Bd., 307 N.W.2d 490, 497 (Minn. 1981).
The district court determined that Cols en cannot bring a pr ocuring-cause claim
because his post-termination compensation is governed by the termin ation provisions of
the team and brokerage agreemen ts. It reasoned that where the parties willfully entered
agreements that provide the scope of available remedies, a resort to equitable doctrines is
not appropriate. The district court also went on to decide in the alte rnative that, even if
Colsen could bring a procuring-cause claim, there is no genuine issue of material fact that
his claim fails the applicable test.
Colsen challenges both decisi ons. As to the first, he argues that “the provisions
purporting to address [his] comm issions upon termination in th e [a]greements are at best
conflicting, but are also contrary to the law as they require [him] to continue to work on
real estate transactions after he is no longer affiliated with [Bright Birch].” Accordingly,
he contends, neither agreement provides a remedy pertaining to his commissions earned at
the time of termination.
Colsen’s argument is not persuasive. As already explained, the differences in the
termination provisions of the agreements ar e immaterial, and the requirement that he
perform work on an ongoing transaction after switching brokerages is not contrary to law.
28
Colsen has not shown that the termination provisions in th e contracts are invalid. The
provisions are part of a bargained-for agreem ent between the parties, and we decline to
apply the gap-filling procuring-cause doctrine when a specific, valid contractual provision
controls the post-termination commissions. See U.S. Fire Ins. Co. , 307 N.W.2d at 497.
The district court properly concluded that Colsen’s procuring-cause claim fails as a matter
of law. Accordingly, we need not determine if a genuine issue of material fact exists as to
whether Colsen was the procuring cause of the Brookwood transaction.
III. The district court did not err by dismi ssing Colsen’s conversion claim on
summary judgment.
Colsen next claims that the district c ourt erred by dismissing his conversion claim.
This claim is based on the as sertion that he holds a proper ty interest in the commissions
that Bright Birch owes him for the sale of the White Bear pr operty, the Brookwood
property, and the 40th Lane property. The di strict court dismissed the claim because it
determined that conversion cannot be based on a claim for money in an intangible form,
and Colsen argues that this was an error.
The tort of conversion occurs when a pe rson “willfully interferes with the personal
property of another without lawful justification depriving the lawful possessor of use and
possession.” Williamson v. Prasciunas , 661 N.W.2d 645, 649 (Minn. App. 2003)
(quotations omitted). “The elements of common law conversion are: (1) plaintiff holds a
property interest; and (2) defendant deprives plaintiff of that interest.” Id.; see also Bates
v. Armstrong, 603 N.W.2d 679, 68 2 (Minn. App. 2000), review denied (Minn. Mar. 14,
29
2000) (“Conversion is the wrongful exercise of dominion or control over the property of
another.”).
While the district court concluded that Colsen could not show conversion with a
claim to money in an intangible form, see Halla v. NW. Bank, N.A., 601 N.W.2d 449, 450
(Minn. App. 1999), review denied (Minn. Dec. 14, 1999), we need not reach that question
because Colsen’s conversion cl aim fails for a more basic reason: he has not shown a
property interest at all, even in money. He alleges that he should have been paid additional
commissions, but he has not shown entitlement to those commissions under either his
contract or procuring-cause theories. Accord ingly, in light of our earlier analysis, we
affirm the district court’s grant of summary judgment on the ground that Colsen has not
shown the requisite “property interest,” Williamson, 661 N.W.2d at 649, to support a
conversion claim. See Doe v. Archdiocese of St. Paul, 817 N.W.2d 150, 163 (Minn. 2012)
(explaining that appellate courts may affirm summary judgment on alternative grounds).
IV. The district court did not err by dismi ssing Colsen’s unjust-enrichment claim
on summary judgment.
Colsen next argues that the district c ourt erred by dismissing his claim for unjust
enrichment, again contending that he has no adequate remedy in contract and should
accordingly be allowed to proceed on this equitable claim.
Unjust enrichment “allows a plaintiff to recover a benefit conferred upon a
defendant when retention of the bene fit is not legally justifiable.” Caldas v. Affordable
Granite & Stone, Inc. , 820 N.W.2d 826, 838 (Minn. 20 12). However, relief under the
30
unjust-enrichment doctrine “cannot be granted where the rights of the parties are governed
by a valid contract.” U.S. Fire Ins. Co., 307 N.W.2d at 497.
Colsen’s unjust-enrichment argument mi rrors his procuring-cause argument. He
again contends that “the [a ]greements fail to properly address payment of [his]
commissions upon his termination.” But as already discussed, this is simply not the case.
Both the team and brokerag e agreements contain valid provisions governing post-
termination commissions. Because the rights of the parties are specifically addressed by
the contracts, Colsen’s unjust-enrichment claim fails as a matter of law. See id.
V. The district court did not abuse its disc retion by denying Colsen’s motion to
amend the complaint to add other real-estate transactions.
Finally, Colsen argues that the district court erred by denying his motion to amend
his complaint to add five additio nal real estate transactions. He asserts on appeal that he
did not wish to add new claims, but merely wished to add these transactions “as a factual
basis for his existing claims.”
The Minnesota Rules of Civil Procedure provide that leave to amend a complaint
“shall be freely given when justice so requires.” Minn. R. Civ. P. 15.01. But this standard
is not without limit; a proposal to amend sh ould be denied where the amended pleading
could not survive a motion for summary judgment. Rosenberg, 685 N.W.2d at 332; see
also Hunt v. Univ. of Minn., 465 N.W.2d 88, 95 (Minn. App. 1991).
Colsen argues that he shou ld have been able to amend the complaint to add the other
transactions “as a factual basis” because the team and brokerage agreements are ambiguous
and, accordingly, “a genuine issue of material fa ct exists as to the parties’ intent as to
31
Colsen’s compensation pursuant to the [a]greements.” He seems to assert that these
transactions would support his proposed interpretation of the agreements.8
Because we have already rejected Colsen ’s arguments that the team and brokerage
agreements are ambiguous, ex trinsic evidence fo r interpreting the agreements is not
permissible. See Flynn, 272 N.W.2d at 907-08. Accordingly, permitting Colsen to add the
additional transactions to his complaint w ould have no effect on the outcome of the
summary-judgment decision. The unambiguous contracts control, so Colsen’s complaint
cannot survive a motion for summary judgmen t regardless of whether it contains the
extrinsic evidence of the other transactions. See Rosenberg, 685 N.W.2d at 332. The
district court did not abuse its discretion by denying Colsen’s motion to amend the
complaint.
Affirmed.
8 It is unclear how Colsen believes the othe r transactions would a dvance his case, as it
appears to be undisputed that Colsen was pa id in accordance with both the team and
brokerage agreements for these transactions, which arguably suggests that the parties
intended for both agreements to apply all along.