Heaman v. E.N. Rowell Co.

• Decision Date: 01 March 1933
• Parties: HEAMAN v. E. N. ROWELL CO., Inc.
• Court: New York Court of Appeals Court of Appeals

261 N.Y. 229

185 N.E. 83

HEAMAN

v.E. N. ROWELL CO., Inc.

Court of Appeals of New York.

March 1, 1933.

Action by William A. Heaman against the E. N. Rowell Company, Inc. From an order of the Appellate Division (236 App. Div. 34, 258 N. Y. S. 138) affirming an order of the Special Term denying the defendant's motion for judgment on the pleadings dismissing the complaint, the defendant appeals by permission of the Appellate Division.

The Appellate Division (236 App. Div. 775, 258 N. Y. S. 1075) certified the following question: ‘Does the second alleged cause of action in plaintiff's amended complaint herein state facts sufficient to constitute a cause of action?’

Order reversed in accordance with opinion, and question certified answered in the negative.

See, also, 233 App. Div. 335, 252 N. Y. S. 799.

Appeal from Supreme Court, Appellate Division, Fourth department.

Bayard J. Stedman and George W. Watson, both of Batavia, for appellant.

Everest A. Judd, of Batavia, for respondent.

POUND, Chief Judge.

The action is one to recover damages for an alleged wrongful discharge of plaintiff from the employ of defendant.

The question is whether an allegationin the complaint that an oral contract of employment for life by a corporation was made through its president, can be upheld as sufficient in law. That a contract for employment for life if authorized by the corporation and based on an adequate consideration, will ordinarily be sustained admits of no dispute. Riefkin v. E. I. Du Pont De Nemours & Co., 53 App. D. C. 311, 290 F. 286;Arentz v. Morse Dry Dock & Repair Co., 249 N. Y. 439, 444, 164 N. E. 343, 62 A. L. R. 231. Alleged contracts of life employment are, however, so unusual as to have been, with rare exceptions, condemned by the courts as unreasonable and unauthorized. The president or other executive officer of a corporation has no authority as such to make a contract that one should remain in the corporate employ for life even under a general power ‘to appoint, remove and fix the compensation of employees.’ That any board of directors or other persons responsible for the management of a corporation should give such unusual power to an executive officer cannot be implied. Plain language of the managing board, clearly showing that such was the intention of the corporation, coupled with power actually or impliedly vested in the corporation itself, must be found to justify such a hiring. Carney v. New York Life Ins. Co., 19 App. Div. 160, 161, 45 N. Y. S. 1103, affirmed, 162 N. Y. 453, 57 N. E. 78,49 L. R. A. 471, 76 Am. St. Rep. 347;Alexander v. Equitable Life Assur. Soc., 233 N. Y. 300, 135 N. E. 509;Clifford v. Firemen's Mut. Benefit Ass'n of City of New York, 232 App. Div. 260, 249 N. Y. S. 713, affirmed, 259 N. Y. 547, 182 N. E. 175;Davidson v. Library Bureau, 234 App. Div. 47, 254 N. Y. S. 95, modified 259 N. Y. 654, 182 N. E. 221.

The...