Marshall Durbin Food Corp. v. Baker

909 So. 2d 1267 (2005)

Facts

P was elected to the D board of directors; he also held the position of vice president, live production. D experienced a loss of approximately thirty million dollars. Animosity was high. Mr. Durbin owned approximately 80% of the Company stock, and his two daughters, Elise and Melissa, who owned or controlled about 18% of the stock. Elise and Melissa were not re-elected to the board because of 'disruptions due to the forcing of employees to take sides on what to do. P expressed concern regarding the uncertainty of his future with D if anything ever happened to Mr. Durbin. Mr. Durbin offered an 'agreement of termination and/or early retirement' to three high-level Company employees, one of whom was P. P and Mr. Durbin executed a contract which provided a number of circumstances that would trigger an 'effective date.' Once triggered, P would receive a specified amount of compensation for five years. The board ratified the agreement. In 2001, Mr. Durbin was diagnosed with malignant lymphoma in the central nervous system and received radiation therapy treatments to the brain. P assumed the responsibilities of Company president during Mr. Durbin's absence for medical purposes. On emergency petition of Elise, Mr. Durbin was declared incapacitated. The court appointed Mr. Durbin's daughters as temporary co-guardians and Mr. Bainbridge, one of the Company's attorneys, as temporary conservator of Mr. Durbin's estate. On August 30, 2001, P wrote Mr. Bainbridge notifying him that the agreement had been triggered by Mr. Durbin's incapacity. The letter explained that Mr. Baker would perform his duties as a consultant and no longer as an employee. On September 17, 2001, Mr. Durbin died. Within a day or two, D employees went to P's residence and picked up his Company car, explaining to P that he had resigned. P filed a complaint for specific performance of the contract. P was informed by letter that a new board of directors had been elected on October 1, 2001, and had 'immediately' voted to terminate P's employment with the Company in all capacities. The letter referred to P's August 31st letter1 as a 'letter of resignation' and stated that the termination/early retirement agreement referenced therein was 'not valid and, accordingly, the Directors have voted, on behalf of D to repudiate such agreement.' The court upheld the validity of the contract with P being in breach. The court found it to be in the best interest of D to offer top management incentive to prevent their looking for or accepting other employment opportunities in the industry. D appealed.