Summary
In Herald Hotel Assocs. v. Ramada Franchise Sys. (191 A.D.2d 288), this Court held that a corporate officer could be "held accountable, regardless of whether he acted in furtherance of the interests of [the] corporation" in part because he acted "in his own best interests". (See, Courageous Syndicate v. People-To-People Sports Comm., supra, 141 A.D.2d, at 600; Citicorp Retail Servs. v. Wellington Mercantile Servs., supra, 90 A.D.2d, at 532; see also, Bank of N.Y. v. Berisford Intl., 190 A.D.2d 622.)
Summary of this case from Hoag v. Chancellor, Inc.Opinion
March 16, 1993
Appeal from the Supreme Court, New York County (Carol Huff, J.).
Plaintiff brought suit to recover damages based upon defendant Ramada's alleged breach of a preliminary agreement entered into by the parties with respect to plaintiff's purchase of a Ramada Hotel franchise. The IAS Court found the agreement to be enforceable and that a material term thereof was a grant of geographic exclusivity. Subsequent to Ramada's submission of a draft licensing agreement to plaintiff, Ramada went through successive changes of corporate ownership, and defendant Silverman became a principal in each of the several layers of new corporate ownership. Ramada failed to finalize the licensing agreement, and instead defendant Hospitality, and then Ramada, sought to enter franchising agreements with the nearby Penta Hotel, which was within the exclusive territory previously granted to plaintiff under the draft agreement and its attendant preliminary agreement. For the purposes of the instant motion, the evidence supports a conclusion that Silverman was the key actor in arranging the franchise agreement with the Penta, and abrogating the same as to plaintiff, acting on behalf of not only Ramada, but also on behalf of Hospitality as well as in his own best interests. As a corporate officer who acted tortiously, he may be held accountable, regardless of whether he acted in furtherance of the interests of either corporation (see, Polyglycoat Corp. v. C.P.C. Distribs., 534 F. Supp. 200, 204 [SD NY]; Bailey v. Diamond Intl. Corp., 47 A.D.2d 363, 367). For this reason, we reinstate the claims of tortious interference with contract against Silverman.
We also conclude that in the circumstances of this case, there is a triable issue as to whether retention of the $100,000 application fee by Ramada's successor constituted an unjustified windfall to the present defendant, at plaintiff's expense (see, Hutton v. Klabal, 726 F. Supp. 67, 72 [SD NY]).
With respect to the remaining appellate claims, we agree with the IAS Court for the reasons stated in its memorandum decision.
Concur — Sullivan, J.P., Carro, Wallach and Asch, JJ.