Survival Clauses Cannot Create Post‑Termination Renewal Commission Rights Under Maryland Law: Sims Agency v. GEICO (5th Cir. 2025)

Introduction

In Sims Agency, L.L.C. v. Government Employees Insurance Company, the United States Court of Appeals for the Fifth Circuit (summary calendar, per curiam, unpublished) affirmed summary judgment against a captive insurance agency seeking approximately $1.9 million in renewal commissions after its agency agreement was terminated. Applying Maryland law under a contractual choice‑of‑law clause, the court held that a captive agent’s entitlement to post‑termination renewal commissions must be expressly granted in the agency contract; a generic survival clause and commission schedules do not suffice. The court also rejected an unjust enrichment claim, reiterating that such quasi‑contract relief is generally unavailable when the parties’ relationship is governed by an express contract that fully addresses the relevant subject—in this instance, termination.

The decision clarifies two key issues frequently arising in insurance distribution and other commission‑based relationships:

Contract silence—coupled with a survival clause—does not create a right to renewal commissions accruing after termination under Maryland law.
The narrow exceptions permitting unjust enrichment notwithstanding a contract rarely apply; where the contract addresses termination rights, courts will not use unjust enrichment to fill what a party perceives as a “gap.”

Summary of the Opinion

Sims Agency, a captive agent for GEICO operating under a 2016 agreement later superseded by a 2020 agreement, sold GEICO policies from 2016 to 2021. The 2020 agreement incorporated “commission schedules” for various categories, including renewals, and contained a survival clause stating that provisions that “logically should survive” termination would do so. It also provided that upon termination GEICO would withhold Sims’s “final commission check” for six months to complete a final accounting. After GEICO terminated the agency effective August 13, 2021, insureds renewed directly with GEICO. Sims claimed it was owed renewal commissions post‑termination.

The district court granted summary judgment to GEICO, holding that under Maryland law a captive agent’s right to renewal commissions must be expressly provided in the contract; the 2020 agreement had no such language. The court also dismissed Sims’s unjust enrichment claim because an express contract governed the relationship and, in any event, the contract fully addressed termination.

On de novo review, the Fifth Circuit affirmed:

Contract entitlement: Maryland law requires express contractual language to vest a right to post‑termination renewal commissions. The survival clause is too generic to supply the required express grant. The “final commission check” provision suggests finality inconsistent with ongoing post‑termination payments.
Unjust enrichment: Because an express contract covered the subject matter (including termination), unjust enrichment is unavailable. The “Dashiell” exceptions (fraud, bad faith, rescission, or when a contract does not fully address a subject) are “extremely narrow” and inapplicable; the agreement fully addressed termination rights and omitted any right to post‑termination renewals—a dispositive omission under Maryland law. Even if the remedy were available, Sims did not show why GEICO’s retention of renewal premiums was unjust.
Discovery: Additional discovery could not overcome the dispositive absence of an express post‑termination renewal commissions clause under Maryland law.

Detailed Analysis

Precedents Cited and Their Influence

Travelers Indem. Co. v. Merling, 605 A.2d 83 (Md. 1992): The cornerstone for Maryland law on this issue. Merling establishes that a captive agent’s right to renewal commissions after termination must be explicitly conferred by the agency contract. The Sims court quotes Merling for the proposition that “[i]n the absence of a provision in the agreement providing continued payment of renewal commissions after termination, an agent has no right to such commissions.” This rule is dispositive of the contract claim.
Cnty. Comm’rs of Caroline Cnty. v. J. Roland Dashiell & Sons, Inc., 747 A.2d 600 (Md. 2000): Dashiell articulates the general bar against unjust enrichment where an express contract governs the parties’ relationship, with narrow exceptions (fraud, bad faith, rescission, or when the contract does not fully address a subject). Sims relied on the “not fully addressed” exception; the Fifth Circuit explained that Maryland courts treat these exceptions as extremely narrow and declined to apply them here.
AAC HP Realty, LLC v. Bubba Gump Shrimp Co. Restaurants, 219 A.3d 99 (Md. Ct. Spec. App. 2019) and AXE Props. & Mgmt., LLC v. Merriman, 311 A.3d 376 (Md. App. Ct. 2024): These Maryland appellate decisions underscore that Dashiell’s exceptions are rarely—if ever—successfully invoked. The Sims court cited them to highlight the “extremely narrow” nature of the exceptions and the absence of Maryland authority applying the “not fully addressed” exception in circumstances like Sims’s.
Martz v. Day Development Co., 35 F.4th 220 (4th Cir. 2022): The court noted Martz as a rare instance where a federal court applying Maryland law allowed unjust enrichment because the parties’ contract truly failed to specify the plaintiff’s pay rate under unforeseen circumstances—a genuine “gap.” By contrast, Sims identified no comparable gap; the 2020 agreement addressed termination comprehensively but intentionally omitted any right to post‑termination renewal commissions.
Richard F. Kline, Inc. v. Signet Bank/Maryland, 651 A.2d 442 (Md. Ct. Spec. App. 1995): Provides Maryland’s definition of unjust enrichment. The Fifth Circuit used it to stress that even if unjust enrichment were available procedurally, Sims did not show substantive “injustice,” because its expectation of post‑termination commissions was not grounded in the contract.
Castellanos‑Contreras v. Decatur Hotels, LLC, 622 F.3d 393 (5th Cir. 2010): Cited for the de novo standard governing appellate review of summary judgments. This frames the Fifth Circuit’s posture: re‑evaluating the legal questions without deference to the district court’s conclusions.

The Court’s Legal Reasoning

1) The contract claim: Express language requirement and the limits of survival clauses

The Fifth Circuit applied Maryland law pursuant to the 2020 agreement’s choice‑of‑law clause. Under Merling, a captive agent’s right to receive renewal commissions after termination must be granted by the agency contract itself. The 2020 agreement contained:

Commission schedules that set rates for “new business,” “reissue,” and “renewals.”
A survival clause stating that provisions “that logically should survive” termination to accomplish the agreement’s “fundamental purpose” will do so.
A termination provision providing that, upon termination, GEICO would withhold the “final commission check” for six months for a final accounting.

Sims argued that because commissions were a “fundamental purpose,” the renewal rates in the commission schedules should survive termination via the survival clause. The court rejected this for two reasons:

Insufficient specificity: Maryland law requires an “express” grant of post‑termination renewal commissions. A generic survival clause is too indeterminate to create new post‑termination payment obligations, particularly where the contract does not otherwise vest such rights.
Textual signals of finality: The “final commission check” holdback and “final accounting” language signals that commissions are reconciled and closed out upon termination, not that commissions continue to accrue indefinitely on post‑termination renewals.

Put simply: the commission schedules describe rates applicable during the agency relationship; they do not, without clear vesting language, promise ongoing payments after the relationship ends. Under Merling, contract silence on post‑termination renewal commissions equals no right.

2) The unjust enrichment claim: The Dashiell rule and narrow exceptions

Maryland law generally bars unjust enrichment claims where an express contract governs the subject matter of the dispute. Dashiell recognizes narrow exceptions (fraud, bad faith, rescission, or where the contract does not fully address a subject). Sims relied on the last—arguing that if the 2020 agreement is “silent” about post‑termination renewals, the contract doesn’t fully address the subject, leaving room for unjust enrichment.

The court disagreed on two levels:

Availability: Maryland courts have characterized the Dashiell exceptions as “extremely narrow,” and there is essentially no Maryland authority applying the “not fully addressed” exception to commission disputes like this. The Fifth Circuit emphasized that the contract comprehensively addressed rights on termination (return of property; holdback of final commission check; final accounting). The deliberate omission of post‑termination renewal commissions is therefore dispositive under Maryland law, not a “gap” to be filled quasi‑contractually.
Merits: Even if unjust enrichment were theoretically available, Sims did not show why GEICO’s retention of renewal premiums was “unjust.” Sims’s only contention—that it expected future renewals to be paid—is contrary to the contract, which contained no such right and contemplated final reconciliation upon termination.

The court contrasted this case with Martz, where a truly unforeseen contingency produced an actual gap (no contractual methodology for calculating pay under new circumstances). Here, by contrast, termination was expressly covered and the absence of a post‑termination commission right was intentional and legally conclusive.

3) Discovery: Why extrinsic evidence would not have mattered

Sims argued it was denied adequate discovery beyond the contract’s four corners. The court found no reversible error because, under Maryland law, the absence of an express post‑termination commission clause is dispositive. Extrinsic evidence cannot supply a right the contract does not grant—particularly where Merling requires an express contractual grant for post‑termination renewals.

Impact and Practical Implications

For insurance distribution and agency relationships

Express vesting language is essential: Agents who expect to be paid renewal commissions after termination must secure unambiguous contract terms expressly conferring that right. Commission schedules alone do not imply vesting beyond termination.
Survival clauses are not a backdoor to post‑termination pay: Generic survival language will not override the absence of explicit vesting provisions. Parties should draft survival clauses with specificity or include a separate “post‑termination commissions” clause.
Termination provisions signal finality: Clauses referencing a “final commission check,” charge‑backs, or final accountings suggest that compensation is reconciled at termination, not that future renewals will be paid. These clauses can be outcome‑determinative.
Ownership of the book of business: Absent a contractually vested interest, the principal’s retention of renewal business post‑termination will not be “unjust” under Maryland law.

For litigators

Plead unjust enrichment cautiously in the face of a comprehensive contract: Maryland’s Dashiell exceptions are exceedingly narrow. Courts will likely find the contract “fully addresses” termination when it lays out termination procedures, even if it omits a category of compensation.
Expect limited receptivity to extrinsic evidence: Where state law demands an express contractual right (as with Merling), discovery beyond the text seldom changes the outcome.
Choice‑of‑law provisions matter: Parties often hail from different states. Here, Maryland law—selected by contract—controlled the outcome. Similar disputes governed by other states’ laws could differ, reinforcing the strategic importance of governing‑law choices.

For contract drafters

Include an explicit “Post‑Termination Renewal Commissions” clause if any right is intended, specifying:
- Which policies/insureds qualify (e.g., policies originally sold by the agent).
- Duration of post‑termination payments (e.g., for X renewals or Y years).
- Events that forfeit vesting (e.g., cause termination, policy rewrites).
- Accounting methods, timing of payments, charge‑backs, and dispute resolution.
Draft survival clauses with precision; identify which obligations survive (e.g., indemnity, confidentiality, audits) and avoid relying on “logical survival” language for compensation rights.
Align termination and compensation sections; avoid internal tension between “final accounting” language and any intended continuing payment obligations.

Complex Concepts Simplified

Captive agent: An insurance agent who sells exclusively for one insurer or its affiliates. Captive agents typically do not “own” the book of business unless the contract says so.
Renewal commissions: Commissions an agent earns when an insured renews a policy for which the agent was the originating producer. Whether these continue post‑termination depends entirely on the contract.
Survival clause: A provision stating that certain contractual obligations continue after termination (e.g., confidentiality). A generic clause does not create new payment obligations absent explicit language.
Unjust enrichment (quasi‑contract): An equitable remedy to prevent one party from unfairly benefiting at another’s expense. Generally unavailable when a valid express contract governs the parties’ relationship on the disputed subject.
Dashiell exceptions: Narrow circumstances in Maryland law where unjust enrichment may proceed despite an express contract (fraud, bad faith, rescission, or where the contract doesn’t fully address the subject). Courts apply these exceptions sparingly.
Summary judgment (de novo review): A procedural posture where the court decides there is no genuine dispute of material fact and the movant is entitled to judgment as a matter of law. On appeal, the court reviews legal determinations without deference.

Conclusion

Sims Agency v. GEICO reinforces a straightforward but critical rule under Maryland law: post‑termination renewal commissions for captive insurance agents are available only if the agency contract expressly says so. Generic survival clauses and commission schedules that speak to rates during the contractual relationship cannot be repurposed to create ongoing payment obligations after termination. The court’s treatment of unjust enrichment underscores Maryland’s strong preference for enforcing express contracts as written, with only exceedingly narrow openings for quasi‑contract remedies—and none where the agreement comprehensively addresses termination and intentionally omits continuing commission rights.

Though unpublished and therefore nonprecedential under Fifth Circuit Rule 47.5, the decision is a clear and practical guide for agents, carriers, and counsel: if post‑termination renewals are intended to be paid, say so expressly; if they are not, courts will not infer them. In the broader legal context, Sims exemplifies judicial reluctance to use equitable doctrines to override negotiated allocations of rights and risks at termination.

Note: This commentary is for informational purposes only and does not constitute legal advice.