The resolution of the issues involved requires that we focus principally upon Fredericks' rights under the agreement. However, as we have seen, they were scant indeed. The stock option contract provides that it terminates upon any termination of employment (other than death). The employment relationship vests absolute termination rights in the employer. In a situation where such absolute termination rights exist, we cannot accord to the employee higher rights in the stock option agreement merely because the circumstances of termination of employment are framed not in an express discharge, but in an induced resignation. There is no basis for such a result in view of the tenor of the agreement between the parties.
In discussing the concept of hindrance of performance, Professor Williston states, "An exception to this principle must be made where the hindrance is due to some action of the promisor which under the terms of the contract * * * he was permitted to take" 5 S. Williston, Law of Contracts § 677A, at 235 (3d ed. 1961). See also Restatement of Contracts § 295(b) (1932). If this is a "hindrance of performance" case, then, in view of the tenor of the agreement, of the broad scope of Georgia-Pacific's rights, and of what we have just said of our being unable to accord higher rights in the agreement because of the "induced resignation" situation, we find this principle to be applicable here.
It is a well-settled rule of law that where an ambiguity exists in a contract, it will be construed against the drafter. See Alcoa S.S. Co. v. United States, 338 U.S. 421, 70 S. Ct. 190, 94 L. Ed. 225 (1949); Crispin Co. v. Delaware Steel Co., 283 F. Supp. 574 (E.D. Pa. 1968); Giustina v. United States, 190 F. Supp. 303 (D. Ore. 1960), aff'd, 313 F.2d 710 (9th Cir. 1962). However, we find no ambiguity in the contract such as would require construction against the drafter. To the contrary, the contract, and its provision that it terminates upon any termination of employment (other than death) is clear to us and certainly must have been to Fredericks, who was a businessman and the president of a large corporation which had been acquired by a still larger one. We might be impelled to reach a different result if we were to find that the contract was unconscionable or adhesive, but under the circumstances we do not.
Although a broad forfeiture clause in an employment or option contract may work harsh results, a court must act only upon the language of the written contract, which is what we do here. Moreover, where the employment relationship can be terminated by either party at any time without liability to the employer for unexercised stock options or similar benefits, other courts have supported our view and have held that an employee's rights will terminate upon the termination of employment. Haag v. International Telephone & Telegraph Corp., 342 F.2d 566 (7th Cir. 1965); Fontius Shoe Co. v. Lamberton, 78 Colo. 250, 241 P. 542 (1925); Montgomery Ward & Co. v. Guignet, 112 Ind. App. 661, 45 N.E. 2d 337 (1942).
In Haag v. International Telephone & Telegraph Corp., supra, plaintiff sued his former employer to recover damages arising out of the employer's refusal to honor his attempted exercise of a stock option subsequent to his termination of employment. The plaintiff conceded that had his employment been for no fixed term, then defendant could have discharged him without cause and not be obligated to accept a tender of the option. However, plaintiff contended that his employment relationship was orally amended to a fixed term, and that defendant's conduct in discharging him without cause prior to the expiration of this term permitted him to recover the value of the stock options.
In affirming the judgment for the defendant and accepting the lower court's finding that no fixed term of employment existed, the court held that plaintiff's right to exercise the stock option terminated upon his discharge from employment.
In Fontius Shoe Co. v. Lamberton, supra, an employee sued his former employer to recover a bonus under a written contract. The bonus, based upon the employee's sales, was to be paid on the 15th of the month following the month during which it was earned. Furthermore, the bonus reserved to the employer the right to discharge the employee for any reason without liability for the bonus. In Fontius, the plaintiff was dismissed on the first of the month, and sought to recover his bonus which would have been due that month. The lower court found that the defendant discharged the plaintiff arbitrarily and capriciously without cause, and permitted the plaintiff to recover. On appeal, the court reversed and held that even if the lower court's finding was correct, plaintiff was unable to recover:
"The defendant company seems to have incorporated into the contract language which permits such conduct on its part, and also to deprive an employee of his bonus in the event of such a discharge.
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