Matter of Shaffer

[*1] Matter of Shaffer 2009 NY Slip Op 50939(U) [23 Misc 3d 1125(A)] Decided on April 30, 2009 Sur Ct, Nassau County Riordan, J. 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 April 30, 2009
Sur Ct, Nassau County

In the Matter of the Application of Janet Shaffer, as Preliminary Executrix of the Estate of Stephen Shaffer, Deceased, Petitioner,



351847



Wayne H. Wink, Jr., Esq.

1050 Franklin Avenue

Garden City, NY 11530

Colum P. Nugent, Esq.

882 Hempstead Turnpike

Franklin Square, NY 11010

John B. Riordan, J.

In this proceeding to compel the delivery of property (SCPA 2103), petitioner moves for an order granting summary judgment.

Decedent, Stephen Shaffer, was a teacher employed by the Elmont Union Free School District ["District"]. An instrument purporting to be his last will and testament has been offered for probate and preliminary letters issued to his spouse (petitioner) on June 23, 2007.

At the time of his death, on July 14, 2007, decedent's application for retirement was pending. On August 7, 2007, the retirement system granted the application posthumously, dated back to July 2, 2007. Decedent had accumulated 95 unused sick days valued at $20,363.27. Petitioner now seeks an order extending the time to file a claim for those benefits and directing payment of the claim.

In its answer, the District does not oppose extending the time to file a claim. However, the answer raises an affirmative defense of impossibility. The contract requires that accrued sick leave be paid into a "403 (b)" account. It appears to be undisputed that, by law, a "403 (b)" account cannot be created after death. The District alleges that, as a result, it is unable to effectuate payment of the accrued sick leave.

The pertinent provisions of the contract between the Elmont Board of Education and the Elmont Elementary Teachers' Association (July 1, 2007 through June 30, 2009) are as follows:

ARTICLE VI: LEAVES [*2]

A. Sick Leave:

All full time professional staff are entitled to fifteen days of sick leave per year with full pay, three of which may be used as personal days....

ARTICLE IX: UNUSED SICK LEAVE

The District shall pay teachers, upon receiving approved retirement, forty percent of their accumulated unused sick leave at the rate of one two-hundredth of the annual salary of said teacher prevailing during the last year of service.

ARTICLE XI: MANDATORY CLAUSES

3. 403(b) Accounts If the employee does not have an ING 403(b) account, the Employer shall deposit the employer contributions, in the name of the employee, into an ING account established in the employee's name.

8. The UNUSED SICK LEAVE calculated in accordance with Article IX of the collective bargaining agreement shall be remitted by the district on behalf of each eligible employee in the form of a Non-elective Employer Contribution, which shall be subject to all of the provisions of this Agreement.

The contract provides for a grievance procedure which apparently cannot be implemented following the death of the employee. The District does not challenge the jurisdiction of this court to resolve the dispute.

The sum representing the payment for decedent's accumulated sick leave is earned compensation, deferred until retirement (Matter of Teachers Assn. [Bd of Educ.], 34 AD2d 351 [2d Dept 1970]). He therefore had a vested interest in the funds and a construction of the contract which would deprive him of earned compensation, would result in a forfeiture.

Forfeitures are not favored in law or in equity and the court will avoid a finding of forfeiture in the construction of a contract (Lyon v Hersey, 103 NY 264 [1886]; Boyarsky v Frocccaro, 131 AD2d 710 [2d Dept 1987]). In this contract, there is no express language which provides for a forfeiture in the event an account is not established and no such provision should be read into the contract.

The court has considered whether the contract should be construed to create a condition precedent with respect to the creation of a "403 (b)" account. A condition precedent is an act or event, other than the lapse of time which, unless the condition is excused, must occur before there is a duty to perform (Oppenheimer & Co. Inc. v Oppenheim, Appel, Dixon & Co., 86 NY2d 685 [1995]; Preferred Mortgage Brokers, Inc. v Byfield, 282 AD2d 589 [2d Dept 2001]).

A condition precedent should be distinguished from the creation of promises which are independent (Jacobs & Young v Kent, 230 NY 239 [1921]). Here, the decedent's right to payment for accrued sick leave is independent of the requirement that a "403 (b)" account be [*3]established.

Further, even if it were determined that the creation of a "403 (b)" account is a condition precedent, the District should not be permitted to withhold payment of the funds. Impossibility excuses a party's performance of a condition precedent where the means of performance make performance objectively impossible (Kel Kim Corp. v General Markets, Inc., 70 NY2d 900 [1987]). However, impossibility will not excuse a condition if the existence of the condition is not a material part of the exchange and discharge of the promisor will operate as a forfeiture (Johnson v Mutual Life Ins. Co. of New York, 70 F2d 41 [1934], affd 239 U.S. 335 [1934]; Restatement [Second] of Contracts §229 [2008]).

In this case, the creation of the account was not a material part of the right to deferred compensation and a discharge of the obligation to pay compensation would result in a forfeiture of vested rights.

Accordingly, petitioner's motion for summary judgment directing payment of $20,363.27 is granted.

Settle decree.

Dated: April 30, 2009

JOHN B. RIORDAN

Judge of the

Surrogate's Court