Silva v. McCoy

California Court of Appeal Feb 21, 1968 No. Civ. 23570Published

Before: Brown (H. C.)

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Holding. The court held that the employer's lease of the motel premises did not extinguish their contractual obligations to the employee, and that the contract for a specified term could not be terminated except for cause.

Issues

Whether the employer's lease of the motel premises justified the termination of the employee's contract prior to the expiration of the one-year term.
Whether the contract allowed for termination at will upon the assignment or transfer of the motel lease.
Whether the trial court correctly calculated damages based on the difference between the contract salary and the employee's subsequent earnings.

Disposition. affirmed

Quotations verified verbatim against the opinion

“Abell and McCoy could sell, transfer, assign, or lease the motel without restriction, but such transfer of interest did not extinguish their obligations to Silva under the contract.”

“The contract of employment was for a specified term and could not be terminated except for cause.”

BROWN (H. C.), J.

This is an appeal from a judgment awarding Alfred Silva damages against Nathan J. McCoy, his employer, for wrongful termination of a written contract to employ Silva as a motel manager. McCoy contends on appeal that the written contract of employment by its terms contemplated that the ownership of the lease on the motel might be transferred or assigned and that Silva was entitled to compensation as such manager only to the date of the assignment of the lease on the motel.

The facts are not in dispute.

On October 1, 1961, Silva entered into a written contract to manage the Los Robles Motel in Santa Rosa for Peter Abell and Nathan McCoy, the appellant. The employment contract provided that Silva be employed for the “full period of one (1) year” at a salary of $600 per month plus a bonus in an amount equal to 3 percent of the first $133,333 of gross receipts.

The term of employment and the provisions for discharge, if that event became necessary, were set forth in paragraph seven of the agreement which provided as follows:. “ This agreement of employment shall continue for said full' period of one (1) year; provided that Employers shall have the right to terminate the same in the event that Employee shall fail to

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perform his duties in a faithful and reasonably competent manner. In the event Employers shall desire to terminate this contract of employment for the above cause, they shall give one full month’s written notice of the termination of said employment to Employee and shall therein specify how and in what manner Employee has failed to perform his contract of employment. Employers agree to inform Employee, in advance, whenever practicable to do so, of any. dissatisfaction he may have with Employee to the end that the Emploí^ee may promptly correct any condition that may require attention.

“In the event of the termination of this agreement for any reason whatsoever, such termination shall not result in the forfeiture of the bonus earned to the date of the termination. ''

Pursuant to the terms of the contract respondent managed the motel from October 1, 1961, to March 15, 1962, at which time McCoy and Abell leased the premises to Neumann and Visini.

Silva v. McCoy

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BROWN (H. C.), J.

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