From Casetext: Smarter Legal Research

Wichard v. Bear Mill Manufacturing Co., Inc.

Appellate Division of the Supreme Court of New York, First Department
Jan 22, 1991
169 A.D.2d 527 (N.Y. App. Div. 1991)

Opinion

January 22, 1991

Appeal from the Supreme Court, New York County (Francis N. Pecora, J.).


Plaintiff, a former employee of defendant Bear Mill Manufacturing Co., Inc., commenced the underlying action for breach of contract and fraud against the corporate defendant and the estate of its former president, Martin Zimmerman, claiming entitlement to severance pay and a portion of the corporate defendant's pretax profits pursuant to a May 7, 1984 employment agreement between the parties, which bore the signature of the decedent, both individually and in his capacity as president of Bear Mill. Pursuant to the agreement, in the event plaintiff were terminated without cause, he would receive his base salary for 24 months in addition to a percentage of the corporate defendant's pretax profits.

It appears that on or about May 1, 1989, plaintiff's employment with the corporate defendant was terminated by the decedent. Plaintiff received severance pay for approximately six months thereafter until the decedent's death when he was notified by defendant Phyllis Zimmerman, both as executrix of the decedent's estate and as secretary of the corporate defendant, that plaintiff had been terminated and his severence pay discontinued pursuant to paragraph 2 (b) of the employment agreement, which provided, inter alia, that plaintiff would not receive severance pay if terminated for certain specified causes, and demanding that plaintiff return the severance payments already received.

Summary judgment dismissal of the complaint against the estate was properly denied since there is, at a minimum, a question of fact as to whether the decedent and, in turn, his estate, is personally liable for corporate obligations, including severance pay, based upon his signature in his individual, as well as representative capacity on the parties' employment agreement. All the obligations called for thereunder to plaintiff are those of the corporate defendant, not decedent. His only obligation appears to be under paragraph "Fifth (B) (1)", which required him to make a 15% payment to plaintiff of any profit he made under certain specified sales of stock of the corporate defendant.

Similarly, the IAS court properly determined that the automatic stay provision of 11 U.S.C. § 362 is a bar to plaintiff's pursuit of his claims against the corporate defendant. We also find that plaintiff's fourth cause of action of the amended complaint pleaded the elements of a fraud claim with the requisite specificity. (See, CPLR 3016 [b]; generally, Brown v Lockwood, 76 A.D.2d 721.)

Concur — Murphy, P.J., Sullivan, Carro, Milonas and Rubin, JJ.


Summaries of

Wichard v. Bear Mill Manufacturing Co., Inc.

Appellate Division of the Supreme Court of New York, First Department
Jan 22, 1991
169 A.D.2d 527 (N.Y. App. Div. 1991)
Case details for

Wichard v. Bear Mill Manufacturing Co., Inc.

Case Details

Full title:NEIL L. WICHARD, Appellant-Respondent, v. BEAR MILL MANUFACTURING CO.…

Court:Appellate Division of the Supreme Court of New York, First Department

Date published: Jan 22, 1991

Citations

169 A.D.2d 527 (N.Y. App. Div. 1991)
564 N.Y.S.2d 410

Citing Cases

Savoy Bank v. N. Am. Recycling, Inc.

The Clerk is directed to enter judgment accordingly.The note and loan agreement reflect defendant Saurabh…