Thank you for sharing!

Your article was successfully shared with the contacts you provided.
COURT SAYS FISH & NEAVE RIGHT ABOUT DEFERRED PAYMENTS NEW YORK � A Manhattan appellate court has ruled that a law firm acted properly when it voted to defer payments due partners leaving the firm, including its former managing partner. W. Edward Bailey, the managing partner of New York intellectual property boutique Fish & Neave from 1994 to 2000, and management committee member Kevin Culligan, both left the firm in spring 2004 to join King & Spalding. Shortly before the two partners left, a majority of remaining partners voted to amend the partnership agreement to institute a cash accounting rather than accrual accounting system. The amendment also provided that the payment of accrued income and the repayment of capital contributions to departing partners would be deferred until those partners retired or turned 65. The partnership agreement had previously required accrued income to be paid as soon as it could be ascertained and capital to be returned within a year. In a 2004 suit, Bailey and Culligan claimed the measure was intended to penalize them but was invalid because it had not been approved unanimously by the partners. But in Bailey v. Fish & Neave, 650132/04, written by Justice Milton Williams, a unanimous panel of the Appellate Division, 1st Department agreed with the ruling of Manhattan Supreme Court Justice Bernard Fried that the partnership agreement had no requirement for unanimity. The court said the agreement indicated a simple majority would suffice in most instances and spelled out cases, like the expulsion of partners, where a two-thirds majority was required. The lawyer for the partners, Jeffrey Jannuzzo, said the decision impacts departing partners’ rights nationwide, and his clients would seek leave to appeal. � New York Law Journal

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.