Lubin & Meyer, P.C. v. Lubin

In 1988 three attorneys, Donald Lubin, Philip Crowe, and Andrew Meyer, formed a professional corporation to engage in the practice of law, named Lubin & Meyer, P.C. (plaintiff). Lubin, Crowe, and Meyer were shareholders in the corporation. Lubin & Meyer owned key-man life-insurance policies on each of Lubin, Crowe, and Meyer, with Lubin & Meyer designated as the beneficiary. Lubin & Meyer entered into a stock-redemption agreement with Lubin, Crowe, and Meyer, which provided that if any of the three partners were to pass away, the purchase price for any and all interest that they had in the corporation by way of shares or any other interest, including that of their estate, would be satisfied by payment of the life-insurance death benefit. In 1990 Lubin passed away. Lubin & Meyer did not immediately pay the life-insurance proceeds to Lubin’s estate (defendant), but instead demanded that the estate sign a release of all claims that the estate might have had against Lubin & Meyer. The estate refused to sign the release. As a result, Lubin & Meyer filed a lawsuit in Massachusetts Superior Court for a declaratory judgment that the redemption agreement was intended to operate as a final release of all claims. The estate argued that the redemption agreement was only intended to resolve the payment for a partner’s shares upon death. The superior court ruled in favor of Lubin & Meyer, and the estate appealed.