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Ingle v. Glamore Motor Sales, Inc. - 73 N.Y.2d 183, 538 N.Y.S.2d 771, 535 N.E.2d 1311 (1989)

Rule:

Where a party does not sufficiently present facts raising a triable issue regarding the existence of either an oral or written employment contract fixing employment of a definite duration, under the established common-law rule, the employer has the right to discharge that party at will.

Facts:

In 1964, plaintiff Phillip B. Ingle sought to purchase an equity interest in defendant Glamore Motor Sales, Inc. ("GMS") from its then sole shareholder, defendant James Glamore. Ingle was not sold an interest but was hired as sales manager. In 1966, Glamore and Ingle entered into a written shareholders' agreement in which, inter alia, Ingle could purchase 22 of Glamore's 100 shares, Ingle was made an officer and director of GMS and Glamore was given the right to repurchase Ingle's stock if he ceased to work for GMS. In 1982, GMS issued 60 additional shares of stock, all of which were purchased by Glamore and his two sons, defendants William and Robert Glamore. Ingle and the Glamores executed another agreement giving Glamore the option to purchase any stockholder's shares within 30 days of that stockholder's termination. In 1983, Ingle was removed from his corporate posts and his employment was terminated. Glamore exercised his option to purchase Ingle's shares and paid Ingle therefor. Ingle then filed lawsuits against defendants in New York state court alleging, inter alia, breaches of fiduciary duties and contract. The trial court granted defendants' motion for summary judgment in part; the appellate division affirmed, but also granted defendants' motion for summary judgment as to the remaining counts, thereby dismissing all of Ingle's claims. The Court of Appeals of New York granted Ingle permission to appeal.

Issue:

Did Ingle's status as a minority shareholder in GMS entitle him to a fiduciary-rooted protection against being fired?

Answer:

No.

Conclusion:

The Court of Appeals of New York affirmed the appellate division's order. The court held that Ingle's term of employment was never definite and therefore his employment was, at all times, at-will. The contractual agreement for the repurchase of GMS shares upon a stockholder's termination for any reason barred Ingle from receiving any rights against at-will discharge, and the payment made by Glamore to Ingle for his shares was fair. The record did not support the conclusion that defendants breached a fiduciary duty as corporate officers by dismissing Ingle, an at-will employee, and exercising an agreed-upon repurchase-upon-termination clause.

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