 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Phoenix American Inc. v. American Arbitration Association2/11/2003
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
Greg Thornton and Betty MacKenzie appeal from a default judgment entered against them in an action by Phoenix American Incorporated, as well as co-defendants W. Corey West and the American Arbitration Association. Appellants claim the judgment was improperly entered because they appeared in the action below via an assignment to co-defendant West and because they were never informed of the monetary award sought against them. We agree with the latter contention and reverse the portion of the judgment awarding attorney fees.
STATEMENT OF THE CASE AND FACTS
W. Corey West was the president and chief operating officer of ReSourcePhoenix.com (RPC), Gregory A. Thornton its vice-president and chief financial officer, and Betty MacKenzie its vice-president, human resources. In August and September 2000, West, Thornton and MacKenzie each signed a Retention Agreement with ReSourcePhoenix.com which provided for, among other things, a lump sum severance payment of one year's base salary in the event of termination of employment due to an actual or potential change in control (acquisition of controlling interest, merger or sale of assets) of the company. The express purpose of the retention agreements was to "minimize the distraction executives may suffer from the possibility of a Change in Control." The agreement provided that any successor to all or substantially all of the business or assets of the company would be required to assume and agree to perform the agreement and that if RPC failed to obtain such assumption before a succession, the employee would be entitled to severance benefits as if he or she had been terminated on the effective date of the succession.
On November 21, 2000, RPC terminated the employment of West, Thornton and MacKenzie without paying the severance and other benefits specified in the retention agreements. On November 28, 2000, RPC transferred all of its assets to Phoenix American Incorporated (PAI). The asset purchase agreement signed on that date specifically excluded liability for obligations on employment contracts or claims for compensation or severance benefits.
On January 24, 2001, West, Thornton and MacKenzie filed demands for arbitration with the American Arbitration Association (AAA), pursuant to the arbitration clause of the retention agreement, claiming RPC and/or its successor had failed to pay the separation benefits required by the retention agreement.
On February 13, 2001, PAI filed a complaint against the AAA, West, Thornton and MacKenzie, seeking a declaration that PAI was not bound by the retention agreements and not bound to submit to binding arbitration because it was neither a signatory to those agreements nor a successor to RPC. In addition to declaratory relief, the complaint sought an injunction enjoining the individual defendants from proceeding with the arbitration as to PAI unless and until PAI was determined to be a successor to RPC or a party to the retention agreements. The complaint additionally sought costs of suit and reasonable attorney fees from West, Thornton and MacKenzie.
On February 14, 2001, PAI filed an ex parte application for a temporary restraining order and order to show cause re issuance of a temporary injunction. The court issued the order to show cause on February 15.
West, Thornton and MacKenzie, represente
Page 1 2 3 4 5 6 California Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|