Opinion
December 27, 1961
In an action for breach of an employment contract, the defendant appeals from a judgment of the Supreme Court, Kings County, entered April 10, 1961, after a jury trial, for $17,034.50 in favor of plaintiff and against defendant. Upon the trial it was stipulated by counsel that the court should fix the amount of damages and that the jury should determine: (1) whether plaintiff performed his contract and was discharged without cause; and (2) whether plaintiff practiced fraud upon defendant by exaggerating the amount of his annual salary in his previous employment. With respect to such questions the jury rendered a special verdict in favor of plaintiff. Thereafter the court rendered its decision awarding plaintiff the sum of $16,000 as liquidated damages in accordance with the contract between the parties which provided for the payment of such sum in the event that plaintiff's employment was terminated by defendant. Judgment affirmed, with costs (cf. Cotheal v. Talmage, 9 N.Y. 511). The case relied on by defendant ( Curnan v. Delaware Otsego R.R. Co., 138 N.Y. 480), is distinguishable on the facts and is inapplicable to the instant case.
The reservation by defendant of the right to terminate the contract did not provide that defendant should pay $16,000 to plaintiff if the contract should be wrongfully terminated by defendant prior to the expiration date; nor did such reservation constitute an agreement by defendant to pay liquidated damages in the event of its breach of the contract. The reservation merely empowered defendant, if it should determine to do so, to exercise its option to terminate by paying plaintiff $16,000, and limited defendant's liability to that amount if the option should be so exercised by it. The option thus reserved, however, could be exercised only by the payment prescribed; and the exercise of the option would not have constituted a breach of the contract, since it was expressly provided for therein. It has been found on sufficient evidence that defendant breached the contract by wrongfully discharging plaintiff. Concededly, for that breach plaintiff is entitled to recover such damages as he may have sustained, whether they may be greater or less than the sum provided by the contract to be paid in the event of its termination in accordance with its terms. Plaintiff is not entitled, however, to recover the amount awarded to him as liquidated damages since the contract makes no provision for such payment. Hence, a new trial should be had at least for the purpose of assessing plaintiff's damages. [ 28 Misc.2d 979.]