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WIRKMAN v. WIRKMAN COMPANY. (03/24/58)

March 24, 1958

WIRKMAN, APPELLANT,
v.
WIRKMAN COMPANY.



Appeal, No. 350, Jan. T., 1957, from judgment of Court of Common Pleas No. 7 of Philadelphia County, Dec. T., 1956, No. 453, in case of Emanuel Wirkman v. The Wirkman Company et al. Judgment affirmed.

COUNSEL

Abraham L. Shapiro, with him Cohen, Shapiro and Cohen, for appellant.

Israel Packel, with him William A. Whiteside, Jr. and Speiser, Satinsky, Gilliland & Packel, for appellee.

Before Jones, C.j., Bell, Chidsey, Musmanno, Jones and Cohen, JJ.

Author: Cohen

[ 392 Pa. Page 64]

OPINION BY MR. JUSTICE COHEN

Plaintiff appeals from the dismissal of his petition for a declaratory judgment brought to obtain a declaration of his rights under a contract with the defendants.

In 1951 the appellant, who owned a substantial block of stock in the defendant Wirkman Company, which is engaged in the insurance brokerage business, entered into a written agreement with it and the individual defendants whereby he sold his stock to the corporation for $110,000, payable over a period of time. In addition the corporation agreed to pay appellant a pension for three years, a salary as a consultant for seven more years, and other compensation thereafter. In return, appellant covenanted not to act as an insurance agent or broker in competition with the corporation or write any insurance on risks located within an area of fifty miles from the boundaries of Philadelphia. In the event that the appellant breached his covenants the corporation was given the right, in addition to all legal and equitable remedies, to terminate his employment

[ 392 Pa. Page 65]

    as a consultant and thereafter be relieved of its obligation to pay him the agreed upon annual sums.

The contract contained the following provisions for arbitration: "The parties to this agreement agree if a question shall arise as to whether or not an act done by Wirkman in and about the insurance field is a violation of either the letter or spirit of his undertaking and of the restriction set forth in this paragraph, such question of whether or not such act on the part of Wirkman is in violation of the terms of this paragraph shall be submitted to Peter P. Zion, who shall act as arbiter of the facts. The parties hereto agree that Peter P. Zion, having heard the said facts and having acted thereon and having handed down his findings, in writing, to Corporation, Wirkman and Stockholders, as a group, all the parties to this agreement shall be bound by his findings and conclusions in such instance and instances.

"If a finding be made that Wirkman has violated the spirit or letter of this agreement, as set forth in this paragraph, Corporation, in its sole discretion, may terminate his employment as consultant and thereafter be relieved of the necessity to pay him the sums ... set forth and described in the foregoing paragraphs of this agreement."

In 1956 the appellant informed the defendants of his intent to write insurance on risks located outside the fifty mile radius described in the agreement. The defendants informed the appellant that if he used any medium of communication within the prescribed area or did any other act therein in connection with his proposed undertaking, they would consider such acts to be violations of the contract and would therefore ...


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