Sheehy v. Clifford Chance Rogers & Wells

1 A.D.2d 225, 769 N.Y.S.2d 1, 1 A.D.3d 225, 2003 N.Y. App. Div. LEXIS 12189
CourtAppellate Division of the Supreme Court of the State of New York
DecidedNovember 20, 2003
StatusPublished
Cited by2 cases

This text of 1 A.D.2d 225 (Sheehy v. Clifford Chance Rogers & Wells) 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
Sheehy v. Clifford Chance Rogers & Wells, 1 A.D.2d 225, 769 N.Y.S.2d 1, 1 A.D.3d 225, 2003 N.Y. App. Div. LEXIS 12189 (N.Y. Ct. App. 2003).

Opinions

Order, Supreme Court, New York County (Karla Moskowitz, J.), entered May 16, 2002, granting defendant’s cross motion for summary judgment dismissing the complaint and denying plaintiffs motion for partial summary judgment or to dismiss [226]*226defendant’s affirmative defenses, modified, on the law, to deny defendant’s cross motion as to plaintiffs first cause of action, for breach of contract, except insofar as that cause seeks damages for the present value of future installment payments not yet due, and to reinstate that cause to that extent, and to grant plaintiffs motion insofar as to dismiss the second, third, fourth and fifth affirmative defenses, and otherwise affirmed, without costs.

Plaintiff is a former partner of defendant’s predecessor, Rogers & Wells'. At the time plaintiff left the firm, the Rogers & Wells Retirement Plan for Partners stated that partners aged 60-64 would be eligible for early retirement. The Rogers & Wells Partnership Agreement, which incorporated the Retirement Plan by reference, provided that the partnership’s executive committee could “enter into a written agreement” to pay not in excess of “Normal” or “Mandatory” retirement benefits to a partner who, “at the specific written request of the Executive Committee,” withdraws or retires other than in accordance with “Normal Retirement” (ages 65-69) or “Mandatory Retirement” (age 70). The retirement benefits available to a partner who takes normal or mandatory retirement included: four years of payments equal to 37.5% of the distribution of partnership profits the partner would have received had he not retired; participation in the firm’s medical and life insurance plans; use of office space and secretarial assistance; and supplemental retirement payments (SRPs), which are paid for life, beginning in the fifth year after the partner’s retirement. The Retirement Plan stated that SRPs “shall not be paid to a Partner who takes Early Retirement, except at the specific written request of the Executive Committee.”

Plaintiff contends that in January 1995, when he was 57 years old, he and the firm entered into the following oral agreement: in exchange for plaintiffs departure by the end of the year, he would be deemed to have taken early retirement at the executive committee’s specific written request, pursuant to the Retirement Plan and the Partnership Agreement, and he would be entitled to, inter alia, SRPs. Plaintiff duly departed the firm at the end of 1995, received the four years of 37.5% distribution payments, participated in the firm’s health and life insurance plans, and utilized firm office space and secretarial assets. In addition, Edward O’Sullivan, the firm’s Director of Finance/ CFO, testified at his deposition that James Asher, the managing partner, told him that the executive committee had approved SRPs for plaintiff, and it is undisputed that, in conjunction with outside actuaries, the firm’s controller, Vidya Rajpal, prepared [227]*227and sent to plaintiff a memorandum calculating the SRPs he would receive. Nevertheless, defendant refused to pay plaintiff SRPs when they became due on January 1, 2000.

Contrary to the assertions of defendant and the dissent, article X (b) of the Partnership Agreement, which states that if a partner takes early retirement the executive committee “may . . . enter into a written agreement with the . . . Partner authorizing payment” of benefits in addition to those set forth in article X (a), such as SRPs, does not bar plaintiffs claim as a matter of law. Article X (b) does not declare that the only way in which a partner may receive SRPs and other amounts beyond those provided in article X (a) is by written agreement; in fact, it is undisputed that plaintiff received certain profit distributions, which are also not mentioned in article X (a), without a written agreement. In addition, plaintiff submitted evidence that at least two partners who took early retirement receive SRPs, even though they do not have written agreements with defendant, a fact overlooked by the dissent.

Similarly, and contrary to the dissent’s interpretation, section 5.4 of the Retirement Plan does not prohibit the payment of SRPs in the absence of a written agreement. Section 5.4 states: “[SRPs] shall not be paid to a Partner who takes Early Retirement, except at the specific written request of the Executive Committee.” The phrase “specific written request” refers to “Early Retirement,” not the payment of SRPs, and thus the provision should be read as conveying the sentiment that SRPs shall not be paid to a partner who takes early retirement unless the early retirement was at the specific written request of the executive committee; the provision is silent as to whether a written agreement to pay SRPs is required. That conclusion is compelled by logic (the executive committee would not “request” a retiring partner to permit the firm to pay him SRPs) and by the use of the identical phrase in article X (b) of the Partnership Agreement with respect to early retirement but not the payment of SRPs. Section 2.5 (b) of the Retirement Plan, cited by the dissent, merely references section 5, and thus adds nothing. Section 6.1 of the Retirement Plan does state that Senior Counsel “shall enter into a written agreement with the Firm containing provisions approved by the Executive Committee, including [a noncompete clause]” in “exchange for receiving [SRPs] and all other benefits under this Plan.” However, the Retirement Plan does not mandate any particular time requirement and, as already noted, Rogers & Wells paid “all other benefits” to plaintiff without a written noncompete agreement.

To the extent the Partnership Agreement and Retirement [228]*228Plan appear to prohibit the payment of SRPs to a partner taking early retirement unless that early retirement was at the specific written request of the executive committee, neither the Partnership Agreement nor the Retirement Plan prohibits oral modifications, and article XXII of the Partnership Agreement specifically permits oral modifications. For that same reason, General Obligations Law § 15-301 does not bar plaintiffs claim.

Insofar as the dissent argues that plaintiff was not even a “Senior Counsel,” because he was not yet 60 years old (the commencement age of “Early Retirement” as set forth in the Retirement Plan) at the time he withdrew from the firm, it is undisputed that Rogers & Wells executed a “Change of Status Form” listing plaintiff as “Senior Counsel,” a term the dissent acknowledges is defined as a partner who “has retired in accordance with the provisions of [the Plan].” That plaintiff was designated a Senior Counsel, even though he had not yet attained the age of 60, also refutes the dissent’s proposition that the Retirement Plan and Partnership Agreement could not be orally modified.

We also disagree with defendant’s argument that the agreement alleged by plaintiff was an unenforceable agreement to agree. To be sufficiently definite, an agreement need not contain a dollar amount; if it contains a method for calculating the amount, that suffices (see e.g. Cobble Hill Nursing Home v Henry & Warren Corp., 74 NY2d 475, 483 [1989], cert denied 498 US 816 [1990]; Joseph Martin, Jr., Delicatessen v Schumacher, 52 NY2d 105, 110 [1981]). The Retirement Plan specifies in detail how to calculate SRPs.

Defendant argues, and the dissent agrees, that the statute of frauds bars the alleged oral agreement, since SRPs are paid for life, beginning in the fifth year of retirement, and thus are not capable of complete performance within one year.

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Related

Wilson v. Dantas
2019 NY Slip Op 4486 (Appellate Division of the Supreme Court of New York, 2019)
Sheehy v. Clifford Chance Rogers & Wells LLP
822 N.E.2d 763 (New York Court of Appeals, 2004)

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Bluebook (online)
1 A.D.2d 225, 769 N.Y.S.2d 1, 1 A.D.3d 225, 2003 N.Y. App. Div. LEXIS 12189, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sheehy-v-clifford-chance-rogers-wells-nyappdiv-2003.