In re the Arbitration Between Seymour Grean & Co. & Grean

Appellate Division of the Supreme Court of New York

In re the Arbitration Between Seymour Grean & Co. & Grean

274 A.D. 279, 82 N.Y.S.2d 787, 1948 N.Y. App. Div. LEXIS 3057

CourtAppellate Division of the Supreme Court of the State of New York

DecidedOctober 18, 1948

StatusPublished

This text of 274 A.D. 279 (In re the Arbitration Between Seymour Grean & Co. & Grean) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

In re the Arbitration Between Seymour Grean & Co. & Grean, 274 A.D. 279, 82 N.Y.S.2d 787, 1948 N.Y. App. Div. LEXIS 3057 (N.Y. Ct. App. 1948).

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Opinions

Per Curiam.

All the stockholders, officers and directors of the corporations involved herein settled certain differences and disputes by a written agreement in which all parties gave up certain claims and received certain rights and promises in compensation therefor. Respondent Seymour Crean among other things was to be employed by the corporation upon the following terms: “ Crean shall devote only such time to the business of the Corporation as he in his sole judgment shall deem necessary.” The salary was paid for several months and thereafter the corporation refused to make any further payments although Crean claims he worked except as prevented by the other officers and directors.

The question presented is whether under these circumstances the employment contract is to be held illusory and unenforcible. The contract must be considered as an inseparable part of a complete agreement. Clearly the parties could agree to retire Crean on a fixed pension as part of a settlement, and the payments therein promised are to be taken as part of the consideration due Crean arising out of the compromise. Whether the parties called the arrangement an employment or a retirement or just a debt to be satisfied periodically, is immaterial. The agreement is not subject to attack on the ground that a simple employment could be attacked, i.e., as “ illusory ” in that Crean does not promise to do anything. His consideration was furnished once for all at the time of the settlement.

Even assuming that Crean’s duties were separable and were to be treated as an employment contract and nothing more, a reasonable interpretation of the agreement would be that this was not an illusory promise but rather an agreement that Crean would devote such time to , the business of the corporation as would reasonably be required and that he was to be the judge of the amount of time necessary, subject always to the qualification that his decision in the matter should not be in bad faith or arbitrary. The phrase “ in his sole judgment ” was probable designed to eliminate discussion as to whether he was working as much as was required. Hence taken as a simple employment contract, the agreement means that, within wide limits, Crean was intended to be the judge, but he was required to render some substantial services and had to act in good faith.

The contract under which arbitration is sought cannot be said to be a nullity. In any event the arbitration clause contains the broadest provision for arbitration of all controversies and what is now sought to be arbitrated is whether respondent is [281]*281entitled to payment for services actually rendered and for services he offered to perform but was prevented by the other officers and directors from rendering.

The order appealed from should be affirmed, with costs.

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Per Curiam.

All the stockholders, officers and directors of the corporations involved herein settled certain differences and disputes by a written agreement in which all parties gave up certain claims and received certain rights and promises in compensation therefor. Respondent Seymour Crean among other things was to be employed by the corporation upon the following terms: “ Crean shall devote only such time to the business of the Corporation as he in his sole judgment shall deem necessary.” The salary was paid for several months and thereafter the corporation refused to make any further payments although Crean claims he worked except as prevented by the other officers and directors.

The question presented is whether under these circumstances the employment contract is to be held illusory and unenforcible. The contract must be considered as an inseparable part of a complete agreement. Clearly the parties could agree to retire Crean on a fixed pension as part of a settlement, and the payments therein promised are to be taken as part of the consideration due Crean arising out of the compromise. Whether the parties called the arrangement an employment or a retirement or just a debt to be satisfied periodically, is immaterial. The agreement is not subject to attack on the ground that a simple employment could be attacked, i.e., as “ illusory ” in that Crean does not promise to do anything. His consideration was furnished once for all at the time of the settlement.

Even assuming that Crean’s duties were separable and were to be treated as an employment contract and nothing more, a reasonable interpretation of the agreement would be that this was not an illusory promise but rather an agreement that Crean would devote such time to , the business of the corporation as would reasonably be required and that he was to be the judge of the amount of time necessary, subject always to the qualification that his decision in the matter should not be in bad faith or arbitrary. The phrase “ in his sole judgment ” was probable designed to eliminate discussion as to whether he was working as much as was required. Hence taken as a simple employment contract, the agreement means that, within wide limits, Crean was intended to be the judge, but he was required to render some substantial services and had to act in good faith.

The contract under which arbitration is sought cannot be said to be a nullity. In any event the arbitration clause contains the broadest provision for arbitration of all controversies and what is now sought to be arbitrated is whether respondent is [281]*281entitled to payment for services actually rendered and for services he offered to perform but was prevented by the other officers and directors from rendering.

The order appealed from should be affirmed, with costs.

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Bluebook (online)

274 A.D. 279, 82 N.Y.S.2d 787, 1948 N.Y. App. Div. LEXIS 3057, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-arbitration-between-seymour-grean-co-grean-nyappdiv-1948.

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