Court Opinion

ID: 3613940
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:57:31.293729+00
Date Added: 2024-06-11T13:46:57.858514
License: Public Domain

The parties are agreed that sums properly payable under this pension plan are debts of the defendant and not mere donations. One of the terms of the defendant's obligation is this: "No pension or gratuity shall be paid except out of the profits of the Company and no pension or gratuity or claim thereto shall be a charge upon or against or payable out of any of the capital assets of the Company."
At the times in issue, the defendant carried on its balance sheet an entry of $19,591,678.45 under the heading "Reserve for Depreciation." The opinion of the court is that this item must be given effect in arriving at the amount of the "profits" in question. Such a construction, in our judgment, is not the true one.
The words of the defendant's plan must be understood in their popular and ordinary sense, because common usage is the best judge of speech and the average man speaks quite simply. Moreover, these words are now to be read as they would have been so understood when the plan was set up in 1905 — long before income taxes had accentuated a scientific practice of allocating some portion of revenue to the renewal *Page 113 
of assets. We cannot accept the presumption that the average employee of the defendant saw in this plan the technical "depreciation" procedures of the tax-assessment and rate-making cases that are now cited against him. On the contrary, as we must suppose, he looked at the plan as a thing that was meant to urge him to work steadily, by holding out to him some hope of freedom from want in the not unlikely event of a wearingout of his own vigor through his day by day part in the defendant's business. (See Roddy v. Valentine, 268 N.Y. 228, 232.)
These considerations lead us to the conclusion that the word "profits" should in this instance be taken to signify the receipts of the enterprise less current expenses, i.e., net receipts — a construction that seems to us to be likewise quite in step with the popular and ordinary sense of the complementary provision against payment of a pension out of any "capital" asset. (See The People v. The Supervisors of Niagara, 4 Hill 20; Paine v. Howells, 90 N.Y. 660; Miller v. Car TrustInvestment Co., 120 App. Div. 442, 193 N.Y. 617; Eyster v.Centennial Board of Finance, 94 U.S. 500.)
A "Reserve for Pensions and Benefits" which the defendant carried on its books included fines collected by it from its employees and rebates on insurance premiums that were paid in part by them. Whether under these circumstances this entry was in some degree a warranty to the employees or worked an appreciable estoppel in their favor is a question that need not now be determined, if we are right in what we said above.
We vote to reverse the judgments and to grant a new trial, with costs in all courts to abide the event.
LEHMAN, Ch. J., CONWAY and THACHER, JJ., concur with LEWIS, J.; LOUGHRAN, J., dissents in opinion, in which RIPPEY and DESMOND, JJ., concur.
Judgment affirmed. (See 293 N.Y. 755.) *Page 114