Lux v. Environmental Warranty, Inc.

755 A.2d 936, 59 Conn. App. 26, 2000 Conn. App. LEXIS 346
CourtConnecticut Appellate Court
DecidedJuly 25, 2000
DocketAC 19035
StatusPublished
Cited by8 cases

This text of 755 A.2d 936 (Lux v. Environmental Warranty, Inc.) is published on Counsel Stack Legal Research, covering Connecticut Appellate Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lux v. Environmental Warranty, Inc., 755 A.2d 936, 59 Conn. App. 26, 2000 Conn. App. LEXIS 346 (Colo. Ct. App. 2000).

Opinion

Opinion

PETERS, J.

This appeal arises in the context of corporate downsizing that results in termination of the employment of individual employees on the basis of economic conditions unrelated to the quality of the [28]*28employees’ services during their employment. The employee in this case does not challenge on appeal the propriety of the decision to terminate his employment. He relies instead on various terms in his employment contract to support his claims to recover unpaid severance and vacation pay.

The plaintiff, Thomas S. Lux, brought a three count action against the defendant, Environmental Warranty, Inc., in which he claimed that the defendant (1) had a contractual obligation to pay him severance and vacation pay upon termination, (2) had a statutory obligation pursuant to General Statutes § 31-71a or General Statutes § 31-76k to pay him severance and vacation pay upon termination, and (3) had a contractual obligation to continue to pay him salary and fringe benefits due to its failure to give him proper termination notice. The defendant denied the allegations of the complaint, raised several special defenses and filed a counterclaim. The counterclaim alleged that the plaintiff had engaged in a course of conduct that interfered with the defendant’s operations, and that such conduct was a breach of fiduciary duty by the plaintiff in his role as a stockholder in a closely held corporation and one of its key employees.

The court rendered a judgment in favor of the defendant on the plaintiffs complaint and in favor of the plaintiff on the defendant’s counterclaim. The plaintiff has appealed and the defendant has cross appealed. On the plaintiffs appeal, we affirm the judgment with respect to severance pay, but remand the case for further articulation with respect to vacation pay. On the defendant’s cross appeal, we affirm the judgment.

I

THE PLAINTIFF’S APPEAL

On appeal, the plaintiff pursues his claim for severance and vacation pay under the first and second counts [29]*29of his complaint.1 Without challenging the validity of the facts recited in the court’s memorandum of decision, the plaintiff disagrees with the legal conclusions that the court drew therefrom. The gravamen of the plaintiff’s appeal is his claim that the court misconstrued the terms of the employment contract between the parties. Under that contract, according to the plaintiff, in the absence of a showing of cause for discharge, the defendant had no authority to terminate the plaintiffs employment without paying him severance pay and accrued vacation pay.

The court’s memorandum of decision and the record reveal the following relevant facts. The defendant corporation was formed in 1992 to broker insurance for three carriers that insure against environmental risks associated with commercial real estate. That year, the defendant hired the plaintiff as a senior technical officer to assist in the evaluation of environmental risks for one of the carriers with whom the defendant dealt. The other carriers had their own in-house technical officers.

On April 15, 1994, the plaintiff and the defendant entered into a formal employment contract. Before agreeing to the contract, the plaintiff consulted with private counsel.

In 1995, the defendant learned that one of its three carriers would be ending its business relationship with the defendant. By 1996, this carrier had ceased doing business with the defendant. Unfortunately for the plaintiff, this carrier was the one for which the plaintiff had been acting as a senior technical officer. Accordingly, on January 29, 1996, the defendant informed the plaintiff that his expertise would no longer be needed after March 31,1996, the expiration date of his contract of employment. The defendant paid the plaintiffs salary [30]*30until that date. The defendant also offered the plaintiff the use of office space and office resources to ease the plaintiffs transition to other employment. The plaintiff availed himself of these services until March 29, 1996, and thereafter did not return for work at the defendant’s place of business.

The record does not document any further exchanges between the parties until May 1,1996, when the plaintiff wrote the defendant to assert his claimed right to severance and vacation pay.2 The defendant rejected the severance pay claim.3 With respect to the claim for accrued vacation time, the defendant, while disputing its validity, offered to pay the claim in part. The plaintiff declined to accept this offer.

A

Severance Pay

The dispute between the parties concerning the plaintiffs claim for severance pay arises out of the parties’ divergent interpretations of the terms of the plaintiffs employment contract. The court concluded, as the defendant had argued, that the defendant had no liability for severance pay because the contract permitted the defendant, with proper notice, to terminate the plaintiffs employment at the expiration of the term of his employment. The plaintiff contends, to the contrary, that the defendant had no such authority because his employment could not be ended except by compliance with the “termination” clause in the contract. The dis-positive issue, then, is whether the contract limited the authority of the defendant, in discharging an employee [31]*31without cause, to only one proper way to effectuate such a discharge.

Our review of the court’s judgment in favor of the defendant is plenary. In any case in which the parties dispute the meaning of definitive contract language, the determination of what the parties intended by their contractual commitments is a question of law. Pesino v. Atlantic Bank of New York, 244 Conn. 85, 91-92, 709 A.2d 540 (1998); Levine v. Massey, 232 Conn. 272, 277-78, 654 A.2d 737 (1995); Gateway Co. v. DiNoia, 232 Conn. 223, 229, 654 A.2d 342 (1995); Mulligan v. Rioux, 229 Conn. 716, 740, 643 A.2d 1226 (1994); Morales v. Pentec, Inc., 57 Conn. App. 419, 438, 749 A.2d 47 (2000).

The parties agree, as the court held, that their dispute must be resolved by a construction of three provisions in the employment contract. One provision is article II, § 2.2, denominated “Term of Employment.” The second provision is article II, § 2.6, denominated “Termination.” The third provision is article V, denominated “Severance.”

Section 2.24 describes the plaintiffs term of employment as having commenced on April 1,1994, and continuing until March 31, 1996, “unless sooner terminated.” It also states that subject to certain provisions in the termination article of the contract, the employment [32]*32agreement “shall be extended automatically” for additional one year periods.

Section 2.6.15 states that “[t]he employment period shall be terminated upon the first to occur of the following events . . . .” Only one of the stated “events” is arguably relevant.

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Cite This Page — Counsel Stack

Bluebook (online)
755 A.2d 936, 59 Conn. App. 26, 2000 Conn. App. LEXIS 346, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lux-v-environmental-warranty-inc-connappct-2000.