Levy v. J.H. Thorp & Co.
| Decision Date | 15 December 1959 |
| Citation | 22 Misc.2d 538,193 N.Y.S.2d 772 |
| Parties | Nathan D. LEVY, Plaintiff, v. J. H. THORP & CO., Inc., Defendant. |
| Court | New York Supreme Court |
Root, Barrett, Cohen, Knapp & Smith, New York City, by Whitman Knapp, Martin F. Richman, New York City, of counsel, for plaintiff.
Golden, Wienshienk, Rosenthal & Mandel, New York City, by Bernard Hershkopf, Howard N. Golden, William E. Russell, Jr., New York City, of counsel, for defendant.
ISIDOR WASSERVOGEL, Special Referee.
This is an action to recover damages for the alleged breach of an oral contract of employment.
The amended complaint alleges that defendant employed plaintiff as the manager of its Delsey Fabrics Division for the duration of a lease to certain premises occupied by said Division in New York City. It is plaintiff's contention that while the lease was still in effect, defendant discharged him without justification and in violation of the terms of the oral agreement. Plaintiff's claim is supported by the testimony of one Jahn, a former treasurer and director of defendant, who stated at the trial of this action that he, at defendant's request, orally employed plaintiff for a five-year period, the duration of the lease on the premises occupied by Delsey Fabrics Division.
Defendant's answer denies the making of the alleged oral contract of employment and, as an affirmative defense, pleads the statute of frauds.
Plaintiff was first employed by defendant in 1932 and continued to hold the position of manager of its Delsey Fabrics Division with the title of Executive Vice President until February of 1957. Prior to 1948, plaintiff had not been employed under any contract which had a fixed duration. A written agreement between the parties governed plaintiff's employment from January 1, 1948, until January 31, 1953. Then followed plaintiff's third and final contract of employment with defendant, which ended with his discharge in February, 1957, and the institution of this law suit.
Contrary to plaintiff's contention, the credible testimony and documentary evidence establish that plaintiff's final employment contract, the subject matter of this action, was merely a hiring at will, with no fixed term of employment. The terms of the contract were clearly embodied in a resolution of the board of directors of defendant corporation adopted at a meeting held on December 21, 1953, which fixed plaintiff's compensation at $50,000 per annum, plus a percentage of gross profits. The resolution, further, made these terms retroactive to February 1, 1953, the day after the end of plaintiff's prior written contract with defendant. There is no language in this resolution which can in any way be construed to create a term of employment for a period of five years, or, for that matter, for any fixed period of time.
It is to be noted that this resolution was prepared, submitted to defendant's board of directors and favorably voted upon by Jahn, the same person who testified upon this trial concerning the purported five-year term of the alleged oral employment contract he entered into with plaintiff in behalf of defendant. Yet not one word concerning any term for plaintiff's employment appears in the Jahn-drawn resolution or in any other corporate document produced upon the trial. The language of the resolution is clear and unambiguous, to wit: 'Further Resolved: That N. D. Levy's salary and profit arrangement from February, 1953, be set at $50,000.00 per annum, plus 5% of profits before taxes are determined.' This resolution was not only voted for by Jahn, it was the product of his draftsmanship and must be deemed to be the memorial of his dealings with plaintiff in behalf of the defendant corporation, setting forth all of the terms and conditions governing plaintiff's employment.
Likewise, contrary to Jahn's testimony upon this trial, the financial records of defendant which he certified as treasurer and as a director, clearly refute his present contention that plaintiff had a five-year 'fixed term' contract of employment. Nowhere in these records or financial reports of defendant is there any indication of a corporate contract with plaintiff for a five-year period. Such a contract would have placed the corporation under a contingent liability for at least $250,000 in direct salary to plaintiff, plus a percentage of its gross profits. Instead, on March 31, 1954, and again a year later, Jahn, as treasurer, certified in his financial reports that 'no contingent liabilities are known to exist * * * That the Company has no unusual open contracts or engagements,' a direct contradiction of his testimony here. After Jahn's forced resignation as treasurer in February, 1956, plaintiff made similar representations as Executive Vice President of defendant.
Nothing in the record warrants the conclusion that defendant's employment of plaintiff subsequent to the termination of his written contract in 1953, was in any manner tied to its five-year lease of the Delsey Fabrics Division premises. Plaintiff, on the contrary, received and accepted every benefit which he could claim under his employment contract as set forth in the aforementioned resolution of the board of directors. Significantly, it was not until after his discharge by defendant that plaintiff first came forward with any claim that he had a 'five-year contract.' Even as late as January, 1956, when plaintiff's salary was cut from $50,000 to $37,500, he never asserted that this was a breach of the proposed lease-long contract with defendant. In the opinion of the Court, the alleged five-year contract between plaintiff and defendant never existed. The documentary evidence supports and is clearly consistent with the claims of defendant that all plaintiff had subsequent to January 31, 1953, was a contract at will, which Jahn himself drew and recorded in the minutes of the meeting of the board of directors on December 21, 1953 (supra). It is certainly fair to assume that if plaintiff had a five-year contract, as he here contends, mention of it would have been made in the board of director's resolution or in at least one of the financial reports subsequently prepared by either Jahn or plaintiff. ...
To continue reading
Request your trial