149 N.Y.S. 650 | N.Y. App. Div. | 1914
The complaint alleges that for a period of over twenty-five years and until on or about the 20th of October, 1909, the plaintiff was in the employ of the defendant corporation as its president; that on or about the 20th of October, 1907, the defendant corporation and the plaintiff entered into an agreement in writing, a copy of which is annexed to the complaint; that the agreement recited that the plaintiff was the president of the defendant corporation and had acquired familiarity and experience with the business in which it is and has been engaged; that the corporation was desirous of “assuring unto itself” that said plaintiff, should his connection with said company be severed at any time thereafter, would not engage directly or indirectly in a business competing with that of said company, and that in consideration of one dollar and of other good and valuable considerations plaintiff covenanted and agreed that, should his employment by said company be terminated at any time after the execution and delivery thereof, he would not, during the period of ten years next succeeding after such date, directly or indirectly engage or become interested in the manufacture, use or sale of -municipal telegraph or signaling systems or apparatus, or in any enterprise com
We agree with the Special Term that the Statute of Frauds, being an affirmative defense, is not available to defendant on demurrer to the complaint. The question presented, therefore, is whether the complaint states facts sufficient to constitute a cause of action. There is no allegation as to the age of
The question is whether this contract is enforcible. I suppose there is no objection to a corporation making a contract to pay a person a specified sum of money every year during his life. All contracts of annuities are of this character. I also suppose that there is no legal objection to a contract by which an officer of a corporation agrees for a sufficient consideration that he will not engage in any business competing with the business done by the corporation while he was employed by it, for a fixed term of ten years after he severs his connection with it. We have in this complaint the simple allegation that these two contracts were made, the consideration for the promise in one contract being the promise in the other. There was no allegation in the complaint on which to base a determination that this contract was ultra vires or was not made by the corporation, and the question, therefore, presented in the case of Beers v. N. Y. Life Ins. Co. (66 Hun, 75), and in Carney v. N. Y. Life Ins. Co. (19 App. Div. 160; affd., 162 N. Y. 453), is not presented. I can see no reason, on the allegations of this complaint, for the court to declare the contract void as against public policy or void as being ultra vires, or otherwise unenforcible.
It follows, therefore, that the judgment must be affirmed, with costs, but with leave to the defendant to withdraw the demurrer and to answer within twenty days upon payment of costs in this court and at the Special Term.
Laughlin, Scott, Dowling and Hotchkiss, JJ., concurred.
Judgment affirmed, with costs, with leave to defendant to withdraw demurrer and answer on payment of costs.