COA: Auto supplier breached contract with recruiting service

A trial court erred in awarding judgment to an automotive supplier over a recruiting company in a breach of contract complaint, the Indiana Court of Appeals has ruled.

In March 2019, PointOne Recruiting Solutions entered into an agreement with Omen Casting Group for PointOne to provide employee recruiting services for Omen. The agreement held that the contingency basis would be payable only if a candidate enters a service relationship with Omen or its affiliate within one year after the most recent communication relating to the candidate. PointOne’s service fee was equal to 25% of the candidate’s first year’s base salary.

In April 2019, Jared Smerchek, a recruitment manager with PointOne, contacted Omen human resource manager Pam Solo about two employment candidates, including Serleaf Barry, who was looking for an annual salary of around $125,000. But in a subsequent phone call, Solo said she was not interested in hiring Barry.

In September, Omen needed to hire someone to fill a different position. At the time, Solo was in contact with Matt Williams, a recruiter for Movement Search and Delivery. Williams submitted Barry’s resume to Solo, and Williams scheduled an interview with Barry. Solo did not remember that Smerchek had previously referred Barry for employment, and Barry was hired in December with a salary of $120,000.

After Smerchek learned Omen had hired Barry within one year after Smercheck had recommended him for a position, he sent Omen an invoice for $30,000. At trial in Marion Superior Court, Omen argued that because PointOne’s communication with Solo in which it identified and referred Barry was about a different position than the one for which he was ultimately hired, they were not liable.

The trial court ultimately entered judgment for Omen. But on appeal, the COA sided with PointOne, ruling it had established prima facie error.

“The agreement’s terms are simple. Omen promised to pay PointOne if Omen hired any candidate referred to Omen by PointOne within one year ‘after [their] most recent communication relating to the candidate,’” Judge Edward Najam wrote for the COA. “It was undisputed at trial that Barry was a candidate under the terms of the agreement, that PointOne had communicated with Omen about Barry in April 2019, and that Omen hired Barry in December 2019 with an annual salary of $120,000.”

The appellate court thus reversed, remanding for the trial court to enter judgment for PointOne in the amount of $30,000, plus attorney fees. The case is PointOne Recruiting Solutions, Inc. v. Omen USA, Inc. d/b/a Omen Casting Group, 21A-CC-518.