Kardon v. Portare

• Decision Date: 17 March 1976
• Citation: 353 A.2d 368,466 Pa. 306
• Parties: Lester KARDON et al., Appellees, v. Salvatore PORTARE, Appellant, and American Arbitration Association.
• Court: Pennsylvania Supreme Court

353 A.2d 368

466 Pa. 306

Lester KARDON et al., Appellees, v. Salvatore PORTARE, Appellant, and American Arbitration Association.

Supreme Court of Pennsylvania.

March 17, 1976

Argued Oct. 23, 1975.

Bernard J. Avellino, M. M. Westerman, Philadelphia for appellant.

Blank Rome, Klaus & Comisky, Goncer C. Gershenson, Philadelphia for appellee. M. Krestal, William E. Taylor, III, Alan

Before JONES C.J., and EAGEN, O'BRIEN, ROBERTS, POMEROY, NIX and MANDERINO, JJ.

OPINION

MANDERINO Justice.

In June of 1972, appellant, Salvatore Portare, was discharged from his employment at Kardon Industries, Inc., and advised that his share of a certain profit sharing plan was being forfeited. Such forfeiture was permissible under the plan if the employee was discharged for:

'. . . dishonesty, disclosing trade secrets, gross insubordination, gross inefficiency, commission of a felony, or any wilful act committed with the intent of injuring (the company) . . .'

Relying on provisions of the profit sharing trust agreement in effect at the time, appellant filed a demand for arbitration with the American Arbitration Association in December of 1973. The appellees, who are the trustees of the profit sharing trust, then filed a complaint in equity seeking to enjoin the arbitration sought by the appellant. Appellant filed preliminary objections in the nature of a motion to dismiss for lack of jurisdiction. This motion was denied, the trial court holding that equity had jurisdiction to determine the dispute between the parties. This appeal followed.

The profit sharing trust agreement provides that one alleged to have forfeited his rights to any of the trust funds shall have the right to have the matter of forfeiture presented to a review committee within ten days of the date of discharge. After the review committee acts, a right of appeal to the American Arbitration Association within ten days is given. The relevant provisions of the profit sharing trust agreement read as follows:

'(1) Any member discharged for any one or more of the reasons set forth in the foregoing paragraph shall have the right to have the matter of such forfeiture presented to the Review Committee upon written notice to the Trustees within ten (10) days of discharge. Such discharged member and Company, or either of them, shall have the right to appeal to the American Arbitration Association from any decision rendered by the Review Committee upon written notice to Trustees within ten (10) days after the date of the decision of the Review Committee. If the American Arbitration Association, or Review Committee, if there is no appeal therefrom, shall determine that such discharged member shall not forfeit his benefits in the Trust, then such member shall receive the same benefits as an employee who is discharged without cause.

(2) The decision of the American Arbitration Association rendered in accordance with the foregoing shall be final, binding and conclusive upon all parties, and judgment upon the award rendered may be entered in any court of competent jurisdiction. In the event that no appeal is taken thereto, the decision of the Review Committee shall be final, binding and conclusive upon all parties.'

See also Chester City Sch. Auth. v. Aberthaw Const. Co., 460 Pa. 343, 333 A.2d 758 (1975); Borough of Ambridge Water Authority v. Columbia, 458 Pa. 546, 328 A.2d 498 (1974).

The parties agree that the profit sharing trust agreement gives the American Arbitration Association subject matter jurisdiction to determine whether an employee should forfeit benefits due from the plan. The parties disagree, however, as to whether the American Arbitration Association is authorized to determine whether the appellant has filed a proper and timely appeal to that Association. There is a factual dispute between the parties as to whether or not the appellant complied with the procedural requirements of the trust agreement. Appellant contends that he complied with all provisions that were not waived by the appellees. The appellees contend that appellant did...