[18 NJSuper Page 172] This suit is brought by plaintiff, Robinson G. Hollister, against Theodore Fiedler as executor of the estate of William C. Fiedler, for specific performance of an agreement to surrender and deliver certain shares of
stock in Fiedler & Hollister, Inc., a corporation of New Jersey. Defendant counterclaims for an accounting.
Prior to 1944 plaintiff and William C. Fiedler (now deceased) were independently engaged in the insurance business in the City of Newark. On February 1, 1944, they became associated in Fiedler Agency, Inc., a corporation owned by William C. Fiedler and which was also engaged in the business of selling insurance. Plaintiff Hollister on that date undertook the management of the company. Later the name of the corporation was changed to Fiedler & Hollister, Inc.
On May 18, 1945, Fiedler & Hollister, Inc., Robinson G. Hollister and William C. Fiedler entered into two separate written agreements. The one agreement will be termed an employment agreement, by the terms of which plaintiff was employed as general manager for a term of five years. Other provisions of this agreement dealt with the employment of Fiedler and the method of computing compensation. The other agreement will be termed an option agreement. This agreement recites that Fiedler and Hollister each was the owner of 11 shares of the capital stock of Fiedler & Hollister, Inc., and contained a provision as follows:
"4. Upon the death of Fiedler or Hollister, the survivor of them, if still in the employ of the Company, shall have an option to purchase the shares of stock of the Company owned by the other upon the following terms and conditions:
(a) -- Such survivor shall give written notice of the exercise of this option within sixty (60) days of such death to the personal representative of the deceased party or, in the absence of such personal representative, to his next of kin.
(b) -- Within thirty (30) days of the giving of such notice as aforesaid, the survivor exercising the same shall tender to the legal representative of the deceased party, or, in the absence of such legal representative, to the next of kin of the deceased party, the book value of the shares of stock of the Company held by him, and shall agree to pay or cause to be paid to the lawful widow of such deceased party, if any there be, an amount equal to 25% of the net profits of the Company earned from and after the date of such death, determined after payment of all expenses, including all federal, state and local taxes, but before deducting therefrom the amount of any compensation payable by the Company to such surviving
party, for the term of her natural life, or until the death of said surviving party, whichever shall first occur; and
(c) -- Thereupon, the surviving party shall acquire all the right, title and interest in the shares of stock of the Company held by the deceased party."
William C. Fiedler died August 29, 1950. It is conceded that plaintiff timely notified defendant as executor of the estate of William C. Fiedler of his intention to exercise the option to purchase the stock in accordance with sub-paragraph (a) of the agreement. Defendant contends however that (1) plaintiff was not an employee of Fiedler & Hollister, Inc., as contemplated by the option agreement and therefore had no right to exercise the option, and (2) that plaintiff did not tender the book value of the shares of stock as required by sub-paragraph (b) of the agreement.
Defendant's first point is without merit. Plaintiff's employment did not terminate upon the expiration of the contract. He continued uninterruptedly to the date of the final hearing. As a general rule, where one is employed for a definite period and continues in the employment after the expiration of that period without a new express contract, it is presumed that the employment is continued on the terms of the original contract. 56 C.J.S., Master and Servant , § 10; Art Wire & Stamping Co. v. Johnson , 141 N.J. Eq. 101, 56 A. 2 d 11 (Ch. 1947), affirmed 142 N.J. Eq. 723, 61 A. 2 d 240 (E. & A. 1948). Where, however, the ...