Remede Consulting Group, Inc. v Pitter
Attorneys and Parties
Brief Summary
Employment and corporate governance dispute involving an employee's personal use of a company-issued corporate credit card and resulting claims for breach of contract, conversion, and breach of fiduciary duty.
The Supreme Court, Nassau County, granted the employer summary judgment on liability against Jason Pitter on the contract, conversion, and fiduciary-duty claims tied to the corporate credit card and also granted summary judgment on damages in the amount of $135,246.77.
The Appellate Division reversed the judgment only to the extent it awarded summary judgment on damages in the principal sum of $135,246.77, while leaving intact the grant of summary judgment on liability.
Although the employer proved that Pitter's personal use of the card was unauthorized as a matter of law and that his claimed oral authorization did not create a triable issue of fact, the employer did not provide a sufficiently precise calculation of the amount actually owed, leaving triable issues of fact on damages.
Background
Remede Consulting Group, Inc. sued its employee, Jason Pitter, among others, alleging that he used a corporate credit card for personal expenses in violation of the company's written credit card policy and his signed acknowledgment of that policy. Pitter did not dispute that he made personal charges, but argued that Jerome Daniel, the company's president, had orally authorized that use. The company sought damages for breach of contract, conversion, and breach of fiduciary duty based on the alleged misuse of company funds.
Lower Court Decision
The Supreme Court granted Remede Consulting Group, Inc.'s motion for summary judgment on liability against Pitter on the portions of the breach of contract, conversion, and breach of fiduciary duty causes of action relating to misuse of the corporate credit card. It also granted summary judgment on damages and entered judgment against Pitter for $135,246.77.
Appellate Division Reversal
The Appellate Division held that summary judgment on liability was proper because the company established the existence of a binding written policy limiting use of the card to authorized business expenses, Pitter's agreement to abide by that policy, his personal use of the card, and his fiduciary obligations as an employee-agent. His claim of an oral side agreement with the company president was insufficient to defeat summary judgment. However, the court ruled that the company failed to make a precise showing of the amount of damages caused by the unauthorized charges, so the damages award had to be vacated and that branch of the motion denied.
Legal Significance
The decision reinforces that an employee's signed acknowledgment of a corporate credit card policy can support summary judgment on liability for breach of contract, conversion, and breach of fiduciary duty when the employee admits personal use of company funds. It also underscores that even where liability is established as a matter of law, summary judgment on damages requires a precise, undisputed calculation; otherwise, damages must be resolved through further proceedings.
A company can win summary judgment on liability for unauthorized personal use of a corporate card when clear written policies and acknowledgments exist, but it still must prove the exact amount of loss with precision before obtaining summary judgment on damages.