## Facts

- James McNevin worked for Solvay Process Company from June 18, 1890 to April 6, 1895, when he was discharged.
- The company created a pension/benefit fund effective January 1, 1892, funded solely from company profits; employees made no contributions.
- Written fund rules stated that amounts credited to employees were “gifts” and remained the company’s property until paid out.
- The rules made payment conditional on specified events (e.g., accident, sickness, old age) and required a favorable decision by company-appointed trustees.
- While employed, McNevin accrued credits totaling $52.54 in an individual account under the plan.
- After discharge, McNevin applied to the trustees for payment; the trustees refused and determined he was not entitled under the rules.
- McNevin sued at law to recover $52.54 as a debt; the trial court entered judgment for McNevin, and the company appealed.

## Issues

1. Whether an employee obtains a vested, enforceable right to employer-funded pension credits when the plan labels them as gifts that remain the employer’s property until trustees approve payment.
2. Whether the employee may recover such credited amounts in an action at law after discharge when trustees deny payment under the plan’s conditions.

## Decision

- The Appellate Division reversed the judgment for McNevin.
- The court held McNevin had no vested right in the credited amount and no enforceable claim until the gift was completed by actual payment pursuant to the plan.
- Because trustees denied payment under the rules, the company owed no debt to McNevin recoverable at law.

## Legal Principles

- Employer-funded benefit or pension credits expressly characterized as gifts that remain the employer’s property do not vest merely because they are credited to an employee’s account.
- Where payment is conditional and subject to trustee discretion under the plan, the employee’s interest before payment is only an expectancy, not a property or contract right enforceable as a debt.
- A completed gift in this setting requires satisfaction of the plan’s conditions and actual payment authorized by the administering trustees.

## Conclusion

The court treated the pension plan as a voluntary gratuity rather than a component of wages or a bilateral contract, and it rejected the employee’s attempt to collect credited amounts as a debt because the plan reserved ownership to the employer and conditioned any payout on trustee approval and actual disbursement.


McNevin v. Solvay Process Co., 32 A.D. 610, 53 N.Y.S. 98 (App. Div. 4th Dep’t 1898)