Roden v Dan's Papers, Inc.

[*1] Roden v Dan's Papers, Inc. 2006 NY Slip Op 52247(U) [13 Misc 3d 140(A)] Decided on November 9, 2006 Appellate Term, Second Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on November 9, 2006
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS
PRESENT:: RUDOLPH, P.J., McCABE and LIPPMAN, JJ
2005-1680 S C.

Robert B. Roden, Respondent,

against

Dan's Papers, Inc., Appellant.

Appeals from (1) a decision of the Suffolk County Court (Martin J. Kerins, J.), dated June 29, 2004, (2) an order of the same court, entered September 10, 2004, and (3) a judgment of the same court, entered November 4, 2004. The decision after trial found that plaintiff was entitled to judgment. The order granted plaintiff's motion to add prejudgment interest calculated from February 6, 1999. The judgment, after a nonjury trial, awarded plaintiff the principal sum of $30,225.63 together with prejudgment interest in the sum of $14,689.00 and post-judgment interest in the sum of $954.88, and dismissed the counterclaim.

Appeal from decision dismissed as no appeal lies from a decision after trial (see Greenfield v Tassinari, 8 AD3d 529 [2004]).

Appeal from order dismissed as the right of direct appeal therefrom terminated with the entry of the judgment (Matter of Aho, 39 NY2d 241, 248 [1976]).

Judgment affirmed without costs.

In this action by plaintiff, a former at-will employee of defendant, to recover commissions claimed to be due him, the record shows that plaintiff was terminated in September 1998, allegedly because he had been disloyal to defendant by operating a competing publication during 1998. After a nonjury trial, the court below determined that plaintiff had been disloyal to defendant but that defendant expressly waived said conduct in a letter dated April 22, 1998, wherein defendant consented to plaintiff's sales and publishing of the competing publication, Captain's Guide, on condition that he cease "all activity selling Captain's Guide" in the future. [*2]Accordingly, the court awarded judgment in favor of plaintiff for earned commissions which were not paid to plaintiff after his employment was terminated.

A salesman's commissions are earned when orders are procured, unless by contract or conduct the parties have agreed otherwise (see Bayer v Oxford Univ. Press, 270 App Div 586 [1946], affd 296 NY 780 [1947]; Mott v Good Roads Mach. Co. of N.Y., 277 App Div 677, 679 [1951], mod 302 NY 918 [1951]; 52 NY Jur 2d, Employment Relations § 103). Where an employee is terminated, he is entitled to commissions on sales he procured even though payment for the sales is not received until after termination (see Bayer v Oxford Univ. Press, 270 App Div 586, supra ; 52 NY Jur 2d, Employment Relations § 104; see also 2A NY Jur 2d, Agency § 254). In the instant case, while there was an agreement that commissions were not payable until payment was received from the customer, we find no agreement between the parties or course of conduct establishing that commissions were not earned when orders were procured. Moreover, even if there were an agreement that commissions were earned upon payment, defendant cannot deprive plaintiff of the commissions on the orders he procured by terminating his at-will employment prior to such payment where, as here, the major consideration in the earning of the commissions was the procurement of the orders (see Kelly v Allied Corp., 755 F2d 184, 186 [1985]; Maloney v Jarco Metal Prods. Co., 144 NYS2d 128 [1955]; Richard M. Krause, Inc. v Gardner, 99 NYS2d 592 [1950]).

It is well settled that an employee owes a duty of good faith and loyalty to his employer and the employee should not act in any manner inconsistent with his agency or trust (see Sokoloff v Harriman Estates Dev. Corp., 96 NY2d 409, 416 [2001]; Western Elec. Co. v Brenner, 41 NY2d 291, 295 [1977]; Lamdin v Broadway Surface Advertising Corp., 272 NY 133, 138 [1936]; Murray v Beard, 102 NY 505, 508 [1886]; Turner v Kouwenhoven, 100 NY 115, 120 [1885]; Wallack Frgt. Lines v Next Day Express, 273 AD2d 462 [2000]). An employee who breaches this duty of loyalty and acts in a manner inconsistent with his agency or trust will not be entitled to recover any commissions (see Feiger v Iral Jewelry, 41 NY2d 928 [1977], quoting Restatement [Second] of Agency § 469; Lamdin, 272 NY at 138; Royal Carbo Corp. v Flameguard, Inc., 229 AD2d 430 [1996]; but cf. Phansalker v Andersen Weinroth & Co., 344 F3d 184, 204 [2d Cir 2003]; Musico v Champion Credit Corp., 764 F2d 102, 113 [2d Cir 1985]). We agree with the findings of the court below that plaintiff was disloyal but that his misconduct was expressly waived by defendant in its letter dated April 22, 1998. Since defendant failed to establish that plaintiff sold advertising space or published another issue of his publication in violation of the terms and conditions set forth in said letter, forfeiture of earned commissions is not warranted (see Lamdin, 272 NY at 137; Whalen v Contracting Plumbers Coop. Restoration Corp., 104 AD2d 879 [1984], appeal denied 69 NY2d 604 [1987]). In view of the foregoing, defendant's counterclaim seeking to recover commissions paid to plaintiff in 1998 is without merit.

Rudolph, P.J., McCabe and Lippman, JJ., concur.
Decision Date: November 09, 2006