SUPREME COURT OF THE STATE OF NEW YORK

Appellate Division, Fourth Judicial Department

606 

CA 10-02497 

PRESENT: SCUDDER, P.J., FAHEY, CARNI, GREEN, AND GORSKI, JJ. 

 

RUSTIN R. HOWARD, PLAINTIFF-RESPONDENT, 

V MEMORANDUM AND ORDER

BIOWORKS, INC., DEFENDANT-APPELLANT. 

 

LECLAIR KORONA GIORDANO COLE LLP, ROCHESTER (STEVEN E. COLE OF

COUNSEL), FOR DEFENDANT-APPELLANT. 

WOODS OVIATT GILMAN LLP, ROCHESTER (ANDREW J. RYAN OF COUNSEL), FOR

PLAINTIFF-RESPONDENT. 

 

Appeal from an order of the Supreme Court, Ontario County (Craig

J. Doran, A.J.), entered March 11, 2010 in a breach of contract

action. The order granted the motion of plaintiff for summary

judgment on the issue of liability and otherwise denied the motion of

plaintiff and the cross motion of defendant for summary judgment. 

It is hereby ORDERED that the order so appealed from is

unanimously affirmed without costs.

Memorandum: Plaintiff commenced this breach of contract action

alleging that defendant failed to pay him deferred compensation in the

amount of $19,800 for prior services that he performed in accordance

with the parties’ written agreement. Pursuant to the agreement,

defendant was obligated to pay plaintiff that sum “only at a time or

times determined by [defendant’s] Board of Directors . . . in its sole

and absolute discretion, after consideration of [its] liquidity and

financial performance.” The agreement also provided in relevant part

that, “[a]s a material part of the consideration for this agreement

[for deferred compensation],” plaintiff agreed to release, inter alia,

defendant and its officers from “all claims or causes of action” that

plaintiff had or may have in the future by reason of his employment

with defendant. It is undisputed that defendant has not yet satisfied

the obligation owed to plaintiff.

Plaintiff thereafter moved for summary judgment on the complaint,

seeking the amount of $19,800 plus interest for deferred compensation,

and defendant cross-moved for summary judgment dismissing the

complaint. We conclude that Supreme Court properly granted that part

of plaintiff’s motion for summary judgment on liability only, inasmuch

as there is an issue of fact with respect to the amount of damages,

and denied defendant’s cross motion. The record establishes as a

matter of law that there was an anticipatory repudiation of the
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CA 10-02497 

agreement by defendant, based on defendant’s “ ‘overt communication of

intention’ not to perform” agreed-upon obligations (Tenavision, Inc. v

Neuman, 45 NY2d 145, 150; see generally Long Is. R.R. Co. v Northville

Indus. Corp., 41 NY2d 455, 463-464; Ryan v Corbett, 30 AD3d 1062,

1063). Indeed, the record establishes that, when plaintiff inquired

whether defendant intended to satisfy the obligation in question, he

was informed in writing by defendant’s president that, upon

considering the matter, “the Board did not believe that paying

[plaintiff the amount allegedly due] was a proper use of corporate

funds.” Furthermore, the Board issued a resolution providing that

“after consideration of the applicable six-year contract statute of

limitations . . . this account should be removed from the liability

section of this corporation’s balance sheet.” We thus conclude that

defendant thereby unequivocally communicated its intent not to perform

under the agreement (see Norcon Power Partners v Niagara Mohawk Power

Corp., 92 NY2d 458, 462-463; Tenavision, Inc., 45 NY2d at 150; see

generally O’Connor v Sleasman, 14 AD3d 986, 987-988). Our conclusion

is further supported by the fact that the record contains an affidavit

of defendant’s president asserting “that it was unlikely that

[defendant] would ever make payments to plaintiff under [the

a]greement.” Plaintiff is therefore entitled to damages for total

breach (see Long Is. R.R. Co., 41 NY2d at 463).

Contrary to defendant’s further contentions, we conclude that the

doctrine of anticipatory repudiation applies to the agreement in

question. The agreement was bilateral in nature, rather than

unilateral (id. at 463-464), and was not for the payment of money

only, inasmuch as plaintiff agreed to release all claims he may have

had against defendant in consideration for the deferred compensation

(id. at 466). “The question is whether, at the time of the

repudiation, there existed some dependency of obligation . . . If the

obligations are interdependent, a claim may lie to recover money

payable in the future” (id.). Defendant’s reliance on Sodus Mfg.

Corp. v Reed (94 AD2d 932) is misplaced. In that case, the defendants

had no “future obligations under the contract” at issue because the

defendant promisor died, effectively terminating her contractual

obligations to perform services and to refrain from competing with one

of the plaintiffs (id. at 933).

Entered: April 29, 2011 Patricia L. Morgan

Clerk of the Court