Kocourek v. Booz Allen Hamilton Inc.Kocourek v. Booz Allen Hamilton Inc.
Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered May 20, 2010, which, to the extent appealed from as limited by the briefs, denied plaintiffs motion for leave to amend the complaint, unanimously reversed, on the law and the facts, with costs, and the motion granted.
Plaintiff was employed as an officer of defendant Booz Allen Hamilton Inc.* from 1987 until his retirement in 2007. Prior to March 1992, plaintiff was a participant in a traditional stock rights plan. The plan provided that each year, at defendants’ discretion, plaintiff would be given the option of purchasing common shares and class B shares, the latter of which could be exchanged for class A shares. Upon his retirement, plaintiff was entitled to hold the accumulated shares for two years and then sell them back to defendant at a valuation determined in accordance with the stock rights plan.
In March 1992, plaintiff was transferred to an office in Australia. At that time, defendants terminated his right to participate in the stock rights plan and enrolled him in a “shadow stock” program. According to plaintiff, the “shadow stock” rights that this new program entitled him to were designed to mimic the benefits of the stock rights plan without his actually purchasing or selling any shares. In other words, plaintiff claims that he was assured that the economic benefit of the shadow stock would be the equivalent of the benefit he would have realized had he actually had the right to purchase shares. Plaintiff asserts that the class A stock he had already accumulated was not affected by the shadow stock plan. However, he had to exchange all of his class B shares for “shadow shares.” This he alleges was done with the understanding that he would still be able to defer the sale of that shadow stock for two years after his retirement, along with any shadow shares he may have continued to be offered before his retirement.
In his original complaint, plaintiff alleged that the purpose of
Defendants moved to dismiss the original complaint pursuant to
Plaintiff appealed, and also moved the motion court for reargument or, in the alternative, leave to replead. This Court affirmed, but for a different reason than given by the motion court. Without commenting on the merits of plaintiffs claim, we found that the alleged oral promise to treat shadow stock as equivalent to common shares violated the statute of frauds because it could not be performed within one year (71 AD3d 511 [2010]). This Court also rejected plaintiffs request that he be allowed to replead his breach of oral contract claim, because the request had been raised for the first time on appeal and, in any event, was “unsupported by facts that would correct deficiencies in the pleadings and thereby render his claims actionable” (id. at 512). The motion court also denied plaintiffs motion to reargue or replead, stating that plaintiff had failed to demonstrate how any amended pleading would cure the deficiencies in the existing complaint.
In opposition to the motion, defendants contended, inter alia, that the court was powerless to grant leave because this Court had already denied leave to replead. They also argued that the documents upon which plaintiff was relying to support his breach of written contract claim had been produced a year earlier or were in plaintiffs possession even before he filed the original complaint. Thus, they contended, the new claim was “untimely” and prejudicial. The court denied leave to replead. Without addressing the merits of the motion, it stated that it was bound by this Court‘s decision denying leave to replead.
It is fundamental that leave to amend a pleading should be freely granted, so long as there is no surprise or prejudice to the opposing party (see
Before considering whether plaintiffs delay in seeking amendment of his complaint is prejudicially late, we must first address defendants’ contention that, as the motion court found, this Court‘s refusal to grant plaintiff leave to replead is law of the case. The issue previously before the motion court, and then this Court, was whether plaintiff had stated, or could state upon repleading, sufficient facts to support a claim for breach of an oral contract. This Court found that he could not, because
Defendants have not identified any way in which they would be prejudiced were plaintiff granted leave to interpose a breach of written contract claim. They contend that they produced the documents plaintiff now relies on as early as one year before the instant motion to amend. However, again, mere tardiness is insufficient to defeat a motion to amend (Sheppard, 288 AD2d at 34). Moreover, defendants cannot dispute that plaintiff had already filed his original complaint by the time they produced the documents, and, more importantly, that they produced some of the documents while their motion to dismiss that complaint was still sub judice. Plaintiff was certainly entitled to wait to move until the motion was decided and he had exhausted his efforts to appeal the decision and seek to reargue the motion. Further, there is no indication that plaintiff was attempting to gain a tactical advantage by delaying the making of the motion. To the contrary, he waited only one month to move after his final effort to limit his claim to breach of oral contract had been rejected.
Additionally, there is no prejudice to defendants because the litigation is still in its initial phase. The breach of written contract claim is substantively identical to the breach of oral contract claim; only now there is documentation to support plaintiffs allegations. Defendants had notice of the claim from the inception and should not have to change their strategy in any significant way to defend the new claim (see Castle v Gaseteria Oil Corp., 263 AD2d 523 [1999] [no prejudice resulted from defendants’ delay in seeking to amend answer to interpose defense of release, where plaintiffs knew of existence of written release and had prior notice that defendants contended that the release was enforceable]).
Finally, we note that defendants do not question the merit of the proposed amendment. In any event, we find that the complaint, as amended, is not “palpably insufficient or patently devoid of merit” so that denial of leave would be warranted (see MBIA Ins. Corp. v Greystone & Co., Inc., 74 AD3d 499, 499 [2010]). Accordingly, the motion court should have granted plaintiff leave to amend his complaint. Concur—Mazzarelli, J.P., Andrias, Catterson, Moskowitz and Román, JJ.