Emerson Garden Electric Co. v. Seaboard Surety Co. ( 1965 )

Memorandum.

The order should be reversed and the complaint dismissed. The agreement dated May 16, 1962 — previously approved by the Federal court in chapter XI proceedings and by the Creditors Committee — fixes the rights and duties of the parties and, in addition, provides for arbitration in case differences of opinion arise between them. The agreement did not create a client-attorney relationship between the plaintiffs and the attorneys for the defendant Seaboard and nothing done or said by the defendant or its attorneys effected a breach of that agreement. The plaintiffs may not avoid the provisions of the agreement or the procedures therein prescribed by institution of the present action.

Judges Fuld, Van Voorhis, Burke, Scileppi and Bergan concur in Memorandum; Chief Judge Desmond and Judge Dye dissent and vote to affirm upon the memorandum at the Appellate Division.

Order reversed and the complaint dismissed, with costs in all courts, in a memorandum.