Adams v. Judson

Untermyer, J. The plaintiff maintains this action to recover a sum of money alleged to have been received by the defendant upon the sale of certain stock belonging to the plaintiff. The complaint sets forth that under an agreement made in September, 1930, the defendant transferred to the plaintiff 200 shares of common stock of a corporation known as Concert Management Arthur Judson and 100 shares of common stock of Judson Radio Program Corporation in consideration of services rendered and subsequently to be rendered by the plaintiff. Thereafter, it is alleged, the plaintiff, at the defendant’s request, transferred these securities to a corporation known as Columbia Concerts Corporation, apparently for the purpose of sale. It is charged that the proceeds, amounting to $5,965.50, were received by the defendant, but that he paid over to the plaintiff only $900. Judgment is demanded for the balance of $5,065.50. The answer denies the existence of any agreement to pay the proceeds of the securities to the plaintiff, and also contains pleas of payment, accord and satisfaction and release. Upon the defendant’s motion, summary judgment in his favor was granted upon the ground that the cause of action set forth in the complaint had been released. The record does not contain in full the agreement executed on October 19, 1931, which includes the provisions on which the defendant relies as a release. That agreement was between the plaintiff and Columbia Concerts Corporation. The paragraph containing the alleged release is paragraph “ seventh ” which provides: “ Seventh. Adams agrees that on November 1, 1931, he will, and as of November 1, 1931, he hereby does release, remise and discharge Columbia, its successors, affiliates, assigns, subsidiaries, officers and/or directors of and from any and all claims of whatever kind and nature arising under the aforesaid Agreement dated December 20, 1930, and/or out of any matter or thing except this Agreement and except on and under certain Income Notes of Columbia, dated December 20, 1930, and held by Adams. Columbia agrees that on November 1, 1931, it will, and as of November 1, 1931, it hereby does release, remise and discharge Adams of and from any and all further obligations under the said Agreement [406] dated December 20, 1930 and/or from any other matter or thing except this Agreement. It is specifically understood that the said Agreement dated December 20, 1930, is hereby declared to be terminated as of October 31, 1931, and after that date to be null, void and of no further force and effect.” The defendant was not a party to the agreement of October 19, 1931, containing the alleged release, nor did he furnish any consideration for it. He signed merely as an officer of Columbia Concerts Corporation of which he was president and general manager. The contract of December 20, 1930, which is referred to in the agreement of October 19, 1931, was a contract under which Columbia Concerts Corporation had employed the plaintiff as vice-president and manager at a salary of $26,000 per year. By the agreement of October 19, 1931, that employment contract was canceled for a consideration stated therein and Columbia Concerts Corporation, together with its officers and directors, was released. The defendant contends that although he furnished no consideration for the contract and was not a party to it, these provisions were for his individual benefit and were intended to include any claim which the plaintiff might assert against him, whether individually or as an officer of Columbia Concerts Corporation. The plaintiff maintains that they do not release the defendant from any liability except such as was incurred in connection with the business of Columbia Concerts Corporation as one of its officers and directors. We think the alleged release is not sufficiently free from ambiguity to justify summary judgment dismissing the complaint. It is by no means clear that the defendant was released from individual liability as distinguished from liability incurred as an officer or director of Columbia Concerts Corporation. Recourse may be had, therefore, to parol evidence to explain its effect. Such evidence “ is admissible to apply a writing to its subject.” (Mullen v. Washburn, 224 N. Y. 413, 420.) And in Piedmont Hotel Co. v. Nettleton Co. (263 N. Y. 25, 30) it was recognized that sometimes “ evidence is necessary to establish in what sense ” a release shall operate. If such evidence is necessary on account of ambiguity, then the effect of the release cannot be determined upon affidavits which disclose a controverted state of facts. (Brawer v. Mendelson Bros. Factors, Inc., 262 N. Y. 53, 56.) There are circumstances here which, if established, would tend to sustain the plaintiff’s contention that the release was not intended to include the present claim. The defendant’s amended bill of particulars contains in detail a statement of the payments alleged to have been made by the defendant in discharge of the plaintiff’s claim. This statement indicates that four of these payments were [407] made subsequent to October 19, 1931, and would, therefore, tend to show that the parties did not regard the release as applicable to the claim which is asserted here. (Compare Weitling v. Sorenson, 241 App. Div. 377.) However, in a replying affidavit submitted for the defendant, it is stated that these payments were not made on account of the plaintiff’s claim in this action, but were liquidating dividends on the plaintiff’s stock. Yet these are the payments which, in his answer, the defendant alleges were made “ by reason of any of the matters alleged in the complaint.” It is evident that this again presents an issue of fact which cannot be decided on conflicting affidavits. The judgment and order appealed from should be reversed, with costs, and the motion denied, with ten dollars costs. Martin, P. J., McAvoy and Townley, JJ., concur; Merrell, J., dissents and votes for affirmance.