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App. Div.]

FOURTH DEPARTMENT, JULY TERM, 1898.

that, therefore, no power was given to determine conclusively the rights of a beneficiary. The court limited the provision to another clause in the section.

Defendant contends that the provision in article II — that in no case can the employees demand payment of the sums credited to their account, except when the company shall adjudge the same to be payable must be construed as a condition precedent to the right of recovery, and, therefore, as a logical consequence, that the trustees are vested with an arbitrary discretion in determining whether any cause of dissatisfaction existed, and the legal sufficiency of such

cause.

In other words, it is sufficient to say that they feel dissatisfied, and their utterance shall be final and conclusive, although there is no such stipulation contained in the contract.

In answer to this it should be observed that such adjudication must be "in accordance with the rules and regulations hereby established." That is to say, there must be cause for the dissatisfaction to justify a discharge under article IX; but there is no provision in that, nor in any other article, that the trustees shall be the sole final and exclusive judges of the cause, or that a particular act or omission on the part of the employee constituted a breach of the contract "to faithfully perform the work entrusted to me with a true loyalty to the interests of the Solvay Process Co." In short, the plaintiff has not in express terms, nor by necessary implication, constituted the trustees as a tribunal to determine, absolutely and without appeal to the courts, that he has committed a breach of the contract warranting his discharge and a forfeiture of all rights conferred by it. There is no stipulation that the defendant may relieve itself of its obligation, simply by a statement that the plaintiff has failed to perform his. The language of the instrument does not confer upon the defendant an arbitrary power to declare itself dissatisfied, and thereupon to terminate to the contract and declare the forfeiture.

Defendant further contends that the authority conferred upon the trustees to decide all questions concerning the funds, without appeal (Art. IV), renders their determination final and conclusive and precludes an appeal to judicial tribunals for redress; that this is equivalent to an express agreement that such adjudication shall be a finality upon the question whether there existed any adequate

[Vol. 32.

FOURTH DEPARTMENT, JULY TERM, 1898.

cause for dissatisfaction, authorizing a declaration of forfeiture of the employee's rights and interests under the contract.

The answer to this argument is, that the courts will not give such a construction to the contract as to have that effect, if any other construction may reasonably and properly be adopted. Now, it is obvious that there are many questions that may arise concerning the funds and their application, to which the provision of article IV may properly be applied, and, therefore, that article does not necessarily require that it should be construed as an agreement to make the company the final arbiter upon the question whether the employee has been guilty of a breach of contract. For instance, the trustees may decide that only a portion of the allotment made shall be placed to an employee's credit, whenever they judge it necessary as a matter of discipline (Art. VI); they may purchase an annuity for an employee permanently disabled, in their discretion (Art. IX); they may retain for a period the moneys due a retiring employee, or one discharged without cause, as security for the agreement not to injure the company after leaving its service (Art. XI); they shall decide the proportion to be paid to the widow and children of a deceased employee (Art. XII); they may decide other questions in respect to the additional fund and so forth.

We are, therefore, of the opinion that the plaintiff has not agreed that the trustees shall be the sole and exclusive arbitrators of his rights under the contract.

Defendant lays stress upon the fact that the company itself will gain nothing by a decision in its favor, since the amount withheld from the plaintiff must be transferred to the additional fund, thereby increasing the amount of that fund to be distributed among the widows and children, or relatives of deserving employees; that the regulations provide that the moneys once allotted to the employees shall never be appropriated by the defendant to its own use, and that all power of disposition over them is lost, except to pay them over to the beneficiaries or to the additional fund; that it is not an agreement that the defendant's trustees shall retain the funds if they decide that the plaintiff is not entitled to them, but that they shall pay over the same to other participants, who may assert the enforcement of this obligation. That is true, but we are unable

App. Div.]

FOURTH DEPARTMENT, JULY TERM, 1898.

to perceive that it has any pertinent bearing upon the construction of the contract and its legal effect. The agreement was, that if the plaintiff should be discharged because of dissatisfaction, his account should be transferred to the additional fund for the benefit of deserving participants therein; otherwise, it must be paid to him. It should be observed, by the way, that the employees have no security or protection against the application by the company of all the funds to the uses and purposes of its business, so that, in case of insolvency, a large part of the funds may be lost to them.

The conclusion from the foregoing is, that the plaintiff's right of recovery must depend upon the legal effect and operation to be given to article IX, independent of and uncontrolled by the other articles referred to.

In the absence of any adequate proof of the cause of discharge, or cause of dissatisfaction, it must be held that there is no proof that the plaintiff has violated his agreement by the commission of some act that he ought not to have done, or that he omitted to do something required of him, that justified a dismissal.

In Gray v. Shepard (147 N. Y. 181) it was held that whether there existed "incompatibility," within the meaning of the contract, was a question for the jury upon the evidence; that the employer could not allege incompatibility as a pretense for discharging the plaintiff, but that it must exist in fact to justify the discharge.

Here the plaintiff has earned the moneys placed to his account, and it was incumbent upon the defendant to show some just cause or reason for depriving him of it. He is not claiming damages as for a breach of a purely executory contract, but is seeking to recover moneys due him upon a contract executed.

The opinions of the court in other cases possessing generic characteristics have a pertinent application and may be appropriately referred to in support of our conclusions in this matter. (See Brand v. Godwin, 15 Daly, 456; Crawford v. Mail & Express Pub. Co., 9 App. Div. 481; 22 id. 54; Hummel v. Stern, 21 id. 544; 15 Misc. Rep. 27; Smith v. Robson, 148 N. Y. 252; see, also, Seaver v. Morse, 20 Vt. 622.)

It is an important observation to make, that an adverse decision to the plaintiff in this case would justify the discharge of employees who may have loyally and faithfully performed their duties to the

FOURTH DEPARTMENT, JULY TERM, 1898.

[Vol. 32. company for a long period of years, simply upon a mere declaration that the company had cause for dissatisfaction, and the employee would be deprived of the moneys that he had fairly earned, without any remedy for their recovery in a court of justice.

The cause was fairly and properly tried by the court below upon correct principles, and the judgment and order should be affirmed, with costs.

WARD, J., concurred.

Judgment and order reversed and a new trial ordered, with costs to the appellant to abide the event.

NOTE.

The rest of the cases of this term will be found in the next volume, 33 App. Div. - [REP.

DECISIONS

IN

CASES NOT REPORTED IN FULL.

SECOND DEPARTMENT, JUNE TERM, 1898.

James T. Briggs, as Administrator, etc., of James H. Briggs, Deceased, Respondent, v. Mary L. Goerke, Appellant. Judgment affirmed, without costs, and without prejudice to any action appellant may bring to recover the value of her services. All concurred except Woodward, J., who read for reversal. Hatch, J., absent. Appeal from a judgment entered on a decision of the Special Term in favor of the plaintiff and against the defendant, in an action to compel the defendant to turn over to the plaintiff certain moneys said to have come into possession of the defendant through fraud and undue influence.

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WOODWARD, J. (dissenting): James H. Briggs, prior to the 1st of January, 1892, was engaged in business in the city of Brooklyn as a dealer in newspapers, magazines, etc. He had a son, James T. Briggs, the plaintiff in this action, and a daughter, Mary L. Goerke, the defendant. It appears from the evidence that the plaintiff was somewhat given to drink, and that he was disposed to spend the money which his father had accumulated as opportunity afforded. In the latter part of the year 1891, James H. Briggs was taken ill or entered into a period of decline owing to advancing years. Up to that time and since the death of his wife, which occurred sometime previous, the old gentleman had lived in the rear of the building which he occupied as a store, and the evidence indicates that he was living in a condition of filth and squalor, the young man living with him. On the development of his illness the old gentleman, by common consent, was taken into the family of the defendant, where he remained up to the time of his death. The old gentleman had accumulated a sum of money aggregating something over $3,000, which was originally represented by a certificate of deposit and a bank book. After going to the home of the defendant he signed these papers and delivered them into the hands of the husband of the defendant, directing him to draw the money and to return it to him. This was done; the money was placed in the hands of the old gentleman, who placed it in a box with some other valuables, and gave the same into the keeping of the defendant. After he had been in the family of the defendant for some three or four weeks, his health in the meantime continuing to fail, James H. Briggs sent for an attorney and explained to him that he desired to have his property go to the defendant, but that he desired to have it in his control during his life. He was advised to make a will, but he objected to this on the grounds that it was liable to lead to litigation, and that his son would contest the same. It was finally arranged that the old gentleman should enter into a contract with his daughter, the defendant, who should be given the money in consideration of affording him a home, medical treatment and a respectable burial when he should die. With this understand |

ing the attorney went to his office and drew the contract, returning a few days later and filling in the amount which the old gentleman concluded to give to the defendant. As thus completed the instrument was duly signed in duplicate, each party taking a copy. Some three months later the old gentleman died, and the son began a series of proceedings to get possession of some part of the money which had been thus disposed of, and the present action is the last in the series. The contract was signed in the presence of several persons, and was witnessed by the attorney, of whom the trial court says: "I do not doubt the sincerity and good faith of the attorney who prepared the contract." The trial court, by a process of reasoning which it is difficult for us to understand, reaches the conclusion that After a careful consideration of the whole case I do not think a court of equity should permit the contract to be enforced." The court declares that The father was helpless and absolutely under the control of the defendant, his daughter;" but a careful reading of the evidence discloses, we think, no grounds for this conclusion. There is no evidence to show control on the part of the defendant, and absolutely no conduct other than might be reasonably expected from a daughter in the discharge of her duty to an aged and enfeebled parent. The court continues: "After the father went to live with his daughter the son never saw him except in the presence of his sister, the defendant," but there is no evidence in the case that the son ever sought to see him alone, or that there was any effort to prevent such a meeting. The whole evidence upon this question is that given by the plaintiff, and that it is not disputed is readily accounted for by the fact that, under the provisions of section 829 of the Code of Civil Procedure, the defendant, the only person competent to make such denial, is not permitted to become a witness. Again, the court says: "The sister took immediate charge of the father's property; took it out of the trust company and converted it into cash;" but the evidence upon this point is that the money was taken out of the trust company upon the personal order of the deceased, and that he gave it into the custody of his daughter. Continuing, the court says: "I think, under all the circumstances, the burden was imposed upon the defendant to show the fairness and good faith in the contract under which she claims the father's property, and in this, it seems to me, she has failed. Undue influence must be inferred from all the circumstances of the case." The court then directs judgment in accordance with its findings. The key to this judgment of the court is found in the opinion, in which it is stated that Justice Field, in a somewhat similar case, held: "That whenever from weakness of mind in a person executing a transfer of property arising from age or sickness, though not amounting to absolute disqualification, and the consid

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