Wrongful Termination Cases

Selmark Associates, Inc. vs. Evan Ehrlich. Worcester. November 7, 2013. March 14, 2014. Present: Ireland, C.J., Spina, Cordy, Botsford, Gants, Duffly, & Lenk, JJ. Corporation, Close corporation, Board of directors, Stockholder. Damages, Breach of fiduciary duty, Breach of contract. Contract, Performance and breach. Fiduciary. Consumer Protection Act, Unfair or deceptive act, Availability of remedy, Transactions between partners, Employment. Practice, Civil, Instructions to jury, Injunctive relief, Special questions to jury. Injunction. Employment, Termination. In a civil action involving shareholders and directors of close corporations, the judge did not err in denying a motion for judgment notwithstanding the verdict on the defendant’s counterclaim alleging breach of fiduciary duty, where the record contained ample evidence from which the jury could infer that, in terminating the defendant from his employment, the moving parties (a close corporation that was a majority shareholder of the close corporation in which the defendant was a minority shareholder and that employed him; and the principal owner of the majority shareholder close corporation) violated the duty of utmost good faith and loyalty owed to the defendant as a minority shareholder [536-540]; further, a purported contest of the award of damages on this claim did not rise to the level of acceptable appellate argument [540], In a civil action involving shareholders and directors of close corporations, the judge did not err in denying a motion for judgment notwithstanding the verdict on the defendant’s counterclaim alleging breach of contract when he was terminated from his employment with the close corporation of which he was a minority shareholder, where ample evidence was presented from which the jury could have found that the defendant acquired the stock required to permit conversion of his interest in that close corporation to an interest in a second close corporation (the majority shareholder in the close corporation that employed the defendant), and that the refusal to allow him to do so was a breach of the agreement permitting such conversion [540-542]; however, this court remanded the matter for further proceedings on the issue of the award of damages on the claim of breach of contract [542-546]. In a civil action involving shareholders and directors of close corporations, the judge, in instructing the jury, did not err in declining to inform them that fiduciary duties can be displaced by contract, where the instructions adequately and correctly covered the applicable legal principles of breach of contract and breach of fiduciary duty; further, the jury were not forced to decide legal questions without guidance from the trial judge; finally, the special verdict questions that the jury were asked to answer did not conflate different theories of recovery. [546-549] In a civil action involving shareholders and directors of close corporations, the judge erred in entering judgment in favor of the defendant on his claim of unfair or deceptive acts or practices in violation of G. L. c. 93A, and in awarding double damages, attorney’s fees, and costs, where the claims raised stemmed from or concerned a single venture of which all the parties were a part, and G. L. c. 93A does not apply to employment and shareholder relationships. [549-551] In a civil action involving shareholders and directors of close corporations, alleging, inter alia, that the defendant committed a breach of his fiduciary duty in soliciting the principals of one of the close corporations at issue for a rival after the defendant’s employment with the other close corporation at issue had been terminated, the judge did not err in declining to instruct on the defendant’s right to compete or in denying his motion for judgment notwithstanding the verdict. [551-553] In a civil action involving shareholders and directors of close corporations, the judge did not err in declining to award multiple damages on the defendant’s claim of breach of contract [553]; further, the judge did not abuse his discretion in declining to expand the scope of posttrial injunctive relief [553]. Civil action commenced in the Superior Court Department on April 22, 2008. The case was tried before John S. McCann, J., and motions for posttrial relief were heard by him. The Supreme Judicial Court granted an application for direct appellate review. Ronald W. Dunbar, Jr., for the plaintiffs. Robert D. Cohan for the defendant. On behalf of Marathon Sales, Ltd. Botsford, J. This case is, like many, factually intense. On appeal, however, the primary legal issues raised concern the duties fellow shareholders and directors of close corporations owe to each other in a context where contractual agreements exist defining in part their relationship; also raised are questions about damages. For the reasons discussed hereafter, we affirm the jury verdict in favor of Selmark Associates, Inc. (Selmark), and Marathon Sales, Ltd. (Marathon), on their breach of fiduciary duty claim against Evan Ehrlich. We also affirm the verdict in favor of Ehrlich on his breach of fiduciary duty counterclaim against Selmark and David Elofson. We conclude that, as the jury found, Ehrlich is entitled to recover on his breach of contract counterclaim, but we vacate the award of damages and remand the case to the Superior Court for a new trial on the issue of contractual damages. Additionally, we conclude that Ehrlich is not entitled to recover under G. L. c. 93A, and his c. 93A counterclaim must be dismissed. 1. -Background. What follows is a summary of the factual background of the case, taken from the evidence at trial. We reserve for later discussion additional facts relevant to the issues raised on appeal. Selmark and Marathon are both closely held Massachusetts corporations that operate as what the sales industry calls manufacturer’s representative companies. Both provide outsourced sales support to compánies manufacturing electronic components that lack their own sales staff; these manufacturers are Marathon’s and Selmark’s customers or “principals.” Andrea Terenzi established Marathon in 1980 and remained its owner and sole shareholder until the transactions at issue in this case. In 1997, Terenzi hired Ehrlich as a salesperson for Marathon and the two had a verbal agreement under which, if all went well, Ehrlich would have an option to become an owner and manager of Marathon. Ehrlich proved to be a high-performing salesperson and maintained a good relationship with Terenzi. As Terenzi’s retirement approached, Terenzi was looking for a successor and a way to sell his company, and wanted Ehrlich to have an ownership interest in it. This led to nearly two years of negotiations among Terenzi, Ehrlich, and Selmark for the sale of Marathon. At the time, Selmark was owned by Elofson and Clifton Snuffer, both former Selmark sales managers who purchased the business from Elofson’s father on his retirement in 1993. On or about September 14, 2001, Ehrlich entered into a series of written agreements (collectively, the agreements) providing for the gradual sale of Marathon by Terenzi to Selmark and Ehrlich. The agreements comprise four contracts referred to as follows: (i) stock purchase and redemption agreement (purchase agreement); (ii) employment agreement; (iii) conversion agreement; and (iv) stock agreement. a. The agreements. We set forth the essential terms of each agreement: i. Purchase agreement. The purchase agreement detailed the terms of sale of Marathon to Selmark and Ehrlich. It provided for the gradual acquisition of Marathon stock by the two purchasers through monthly payments to Terenzi, pursuant to two promissory notes.- Upon full payment to Terenzi, Selmark would own fifty-one per cent of the Marathon stock, and Ehrlich the remaining forty-nine per cent. Under the terms of the purchase agreement Marathon bore primary responsibility for the monthly payments to Terenzi. However, if Marathon’s monthly cash flow was insufficient to pay, Ehrlich and Selmark, as separate coguarantors, were responsible for the monthly shortfall. Section 5 of the purchase agreement detailed the procedures in the event of a shortfall and the steps to be taken by Terenzi to notify Ehrlich and Selmark of their respective payment obligations. Specifically, section 5 provided for the parties to conduct a semiannual review of Marathon’s monthly cash flow on March 1 and September 1 of each year and, in the event of a shortfall in the previous six months, Terenzi was to notify Ehrlich and Selmark by sending a “shortfall notice” pursuant to the notice provisions of Section 24 of the purchase agreement. If either Selmark or Ehrlich did not make the payment for which it or he was responsible within the required time frame, Terenzi could declare default on the nonpayor by sending a default notice. The nondefaulting party then had the option to cure the default by making the payment due from the defaulting party and acquiring the Marathon stock attributable to that payment for itself. If a default occurred and was not cured, the purchase agreement allowed Terenzi to recover all Marathon stock, including that which was previously purchased. ii. Employment agreement. The employment agreement was attached to the purchase agreement, and was between Ehrlich and Marathon. The agreement provided for an initial fifteen-month term, until December 31, 2002, with extension possible on the written agreement of the parties. Under the employment agreement’s terms, Ehrlich became the vice-president of Marathon and potentially a director, and could only be terminated for cause. If the agreement was not extended, at the conclusion of the initial contract term, the agreement would terminate and Ehrlich would be required to resign as an officer and director of Marathon. iii. Conversion agreement. Under the conversion agreement, Ehrlich had the option, once he and Selmark fully paid off Ter-enzi for the purchase of Marathon, to convert what would then be Ehrlich’s forty-nine per cent interest in Marathon into a twelve and one-half per cent ownership interest in Selmark. If Ehrlich exercised this option, Selmark would then acquire full ownership of Marathon. The conversion agreement also required that, upon conversion, Selmark offer Ehrlich an employment agreement that would provide “for compensation, bonuses, expense payments, and benefits consistent with his percentage ownership of [Selmark].” Independent of employment, upon conversion, Ehrlich was to become an officer of Selmark and member of its board of directors. iv. Stock agreement. The stock agreement, attached to the conversion agreement, would become operative if and when Ehrlich paid Terenzi his full share of the Marathon purchase price pursuant to the terms of the purchase agreement, and opted to exercise his right to convert Marathon stock for Sel-mark stock under the conversion agreement. Upon those events happening, the stock agreement, a contract between Ehrlich and Selmark, would govern Ehrlich’s rights as a minority stockholder of the company. The stock agreement provided both parties with the opportunity to end the business relationship through the sale of Ehrlich’s stock, subject to certain financial penalties for the party exercising this right. Specifically, Selmark would possess a “call right” pursuant to which, on the occurrence of certain conditions, the company could purchase all of Ehrlich’s stock. If Selmark were to exercise this call right, Ehrlich would receive a premium purchase price of 110 per cent of the “stock purchase value.” Similarly, Ehrlich possessed a “put right,” where, at any time, he could sell, and Selmark would be obligated to purchase, all of his Selmark stock. However, if Ehrlich chose to exercise his put right, he would only receive ninety per cent of the stock purchase value. b. Subsequent events. After the agreements were executed, Marathon and Selmark remained separate entities, but presented themselves as Selmark to the outside world. Marathon moved into the Selmark office space, but maintained separate bank accounts and tax returns. The two companies used each other’s sales forces to sell one another’s product lines, and they did not compete with each other. Ehrlich’s business card identified him as vice-president of Selmark even though in fact he was an employee and vice-president of Marathon pursuant to the employment agreement. Ehrlich’s employment agreement expired by its terms on December 31, 2002, because the parties had not agreed to extend it in writing. Nevertheless, after that date Ehrlich remained an employee of Marathon and retained his position as vice-president. In 2003, Terenzi retired from Marathon, and Ehrlich began to report directly to Elofson. Ehrlich received no complaints from Elofson about his job performance. Ehrlich brought in new business, and was consistently the number two (second only to Elofson) producer of commission income among all Selmark and Marathon sales representatives. In July of 2007, Ehrlich notified Elofson that he intended to accelerate his final payments to Terenzi and complete the payment due on his forty-nine percent share of Marathon stock by December, 2007. According to Elofson, Ehrlich’s announcement prompted Elofson to contemplate the future of Selmark, and then to conclude that he did not see Ehrlich as a successor or want him involved in the future of the business. On October 26, 2007, Ehrlich and Elofson met at a local hotel, purportedly to discuss the details of the Marathon payoff. At that meeting, Elofson informed Ehrlich that his employment with Marathon was terminated, effective immediately, and presented Ehrlich with a termination letter. The letter contained an offer by Sel-mark to purchase Ehrlich’s forty-nine per cent ownership interest in Marathon for the same price he would have received had he converted his Marathon shares into Selmark stock and Sel-mark then exercised its call rights pursuant to the stock agreement. The letter also informed Ehrlich that, due to decreased cash flow, Marathon would have insufficient funds to complete its payments to Terenzi and that Ehrlich was responsible for forty-nine per cent of the shortfall. As he was driving home from that meeting, while speaking to his family on his cellular telephone that was paid for by Marathon, Ehrlich’s telephone service was disconnected. That same day, Elofson also sent a letter to all the Selmark and Marathon principals, notifying them of Ehrlich’s termination and characterizing it as a “failed relationship.” After his termination, Ehrlich received approximately $25,000 in severance from Selmark, but did not cash in his Marathon stock under the terms offered in the termination letter. He remained a minority shareholder of Marathon, but had no access to, or involvement in, the business workings of the company. In November, 2007, Ehrlich took a job as a salesperson with Tiger Electronics (Tiger), a competing manufacturer’s representative company., At Tiger, Ehrlich contacted, and met with, several Marathon principals, attempting to solicit their business. After Ehrlich met with a company known as PKG, PKG terminated its relationship with Marathon and became a Tiger principal. Following his termination, Ehrlich did not believe that Marathon had insufficient funds to make its remaining payments to Terenzi. He expressed these doubts to Terenzi but assured him that, if it were proven that Marathon had insufficient funds, he would honor his commitment to pay. Although Selmark paid its portion of the outstanding amount due to Ter-enzi on a monthly basis after Ehrlich was terminated, Ehrlich did not. Selmark completed its remaining payments to Terenzi by May, 2008, so that the only outstanding balance owed was Ehrlich’s portion. In the fall of 2008, Terenzi and his attorney sent a series of messages via electronic mail (e-mail) to Ehrlich, Elofson, and their counsel, demanding payment. Terenzi, however, never sent a shortfall notice or default notice as prescribed by the purchase agreement. On February 2, 2009, Selmark sent the remaining payment to Terenzi to “cure” what it characterized as Ehrlich’s “default.” Three days later, on February 5, after he learned of Selmark’s payment, Ehrlich wired the same amount to Terenzi’s attorney. Terenzi accepted payment from Ehrlich, and never cashed Selmark’s check. On June 1, 2009, Ehrlich sent Elofson notice of his intention to exercise his conversion rights pursuant to the conversion agreement, and requested issuance of his twelve and one-half per cent stock interest in Selmark. Through counsel, Selmark notified him that he was not entitled to convert because Selmark had “cured [Ehrlich’s] default of his obligations” pursuant to the purchase agreement. Selmark then claimed for itself the portion of stock attributable to the amount on which Ehrlich allegedly had defaulted, and Ehrlich never acquired the forty-nine per cent interest in Marathon necessary to exercise his conversion rights. c. Procedural history. On April 22, 2008, Selmark and Marathon filed a complaint, alleging that by soliciting and acquiring Marathon principals for Tiger, Ehrlich committed a breach of his fiduciary duties to Marathon. In response, Ehrlich asserted thirteen counterclaims against Selmark, Marathon, and Elofson (collectively, the Selmark parties)., The case was tried before a jury in 2011. The jury returned their verdict by answering special questions. They found that Ehrlich committed a breach of his fiduciary duty to Selmark and Marathon, and awarded $240,000 in damages. As for Ehrlich’s counterclaims against the Selmark parties, the jury found that Selmark and Elofson (but not Marathon) committed a breach of contract with Ehrlich, and awarded Ehrlich $1,537,163 in damages. Additionally, they found Selmark and Elofson (but not Marathon) committed a breach of their fiduciary duties to Ehrlich, and awarded $221,408 in damages. The jury determined that all the Selmark parties engaged in unfair or deceptive acts or practices in violation of G. L. c. 93A, again awarding $221,408 in damages. The trial judge later doubled the c. 93A damages and pursuant to c. 93A, § 11, awarded attorney’s fees and costs. After the verdict, the trial judge allowed Ehrlich’s motion for injunctive relief to preserve the assets of Selmark and Marathon pending appeal. Ehrlich later moved to amend his motion to include in the preservation order Elofson’s corporate and personal assets; the judge denied the motion to amend. Judgment entered on October 13, 2011. Ehrlich subsequently filed a motion for judgment notwithstanding the verdict (judgment n.o.v.) and the Selmark parties filed a joint motion for judgment n.o.v., and a motion to amend judgment by remittitur or, in the alternative, a motion for new trial. After rehearing, both parties’ posttrial motions were denied on January 4, 2012. The parties cross-appealed; we granted Ehrlich’s application for direct appellate review. 2. Discussion, a. The Selmark parties’ appeal. On appeal, the Selmark parties focus first on Ehrlich’s successful counterclaims for breach of fiduciary duty and breach of contract, raising issues that concern the appropriate legal principles governing the merits of these claims as well as the damages awarded for each; they also argue that the trial judge’s jury instructions on these claims were fatally flawed by omissions as well as erroneous statements of the law, errors that were compounded by use of a defective special verdict questionnaire. Finally, they challenge the judgment for Ehrlich on his G. L. c. 93A claim, arguing that it must be reversed because c. 93A is inapplicable in this case. We consider these issues separately, beginning with the breach of fiduciary duty claim. Before doing so, however, it is important to review the apparent basis of the jury’s findings on Ehrlich’s breach of fiduciary du

Estate of Stephanie Moulton vs. Nicholas Puopolo & others. Middlesex. November 4, 2013. March 14, 2014. Present: Ireland, CJ., Spina, Cordy, Botsford, Gants, Duffly, & Lenk, JJ. Wrongful Death. Workers’ Compensation Act, Action against employer, Identity of employer. Governmental Immunity. Practice, Civil, Wrongful death, Motion to dismiss, Interlocutory appeal, Standing. Corporation, Charitable corporation, Director’s liability, Board of directors. Negligence, Wrongful death, Governmental immunity, Employer, Gross negligence. Fiduciary. Attorney General. Discussion of the exclusive remedy provision of the Workers’ Compensation Act, G. L. c. 152, § 24. [482-484] In a civil action alleging, inter alia, a wrongful death claim pursuant to G. L. c. 229, § 2, brought by the estate of a decedent employee of a charitable corporation, the defendant directors were entitled, by virtue of the doctrine of present execution, to pursue an interlocutory appeal of the denial of their motion to dismiss the complaint. [485-486] In a civil action brought by the estate of a decedent employee of a charitable corporation against its directors, the judge erred in denying the directors’ motion to dismiss claims of wrongful death pursuant to G. L. c. 229, § 2, and for punitive damages, where the directors were an employer immune from liability under the exclusive remedy provision of the Workers’ Compensation Act, G. L. c. 152, § 24, in that, to the extent the complaint alleged that the decedent’s death arose from the adoption of or failure to adopt corporate policies, their collective action as a board made such conduct possible, irrespective of the votes individually cast; and in that, to the extent the complaint alleged that they had the ability to direct and control the activities of employees and to implement workplace safety, the complaint impliedly alleged that they were acting in the capacity of an employer. [486-491] In a civil action brought by the estate of a decedent employee of a charitable corporation against its directors, the judge erred in denying the directors’ motion to dismiss a claim of breach of a fiduciary duty to the charitable corporation, its employees, its clients, and the general public, where, as the decedent’s employer, the directors owed no fiduciary duty to the decedent; and where the plaintiff did not have standing to pursue any purported breach of a fiduciary duty to the charitable corporation, its clients, or members of the public [491-494]; further, the complaint contained no allegation of a special relationship that otherwise would give rise to a fiduciary duty between any one individual director and the decedent [494]. Civil action commenced in the Superior Court Department on April 15, 2011. A motion to dismiss was heard by Douglas H. Wilkins, J. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. John D. Frumer for Nicholas Puopolo & others. John James Regan (Barry A. Feinstein & Thomas Hodgkins with him) for the plaintiff. The following submitted briefs for amici curiae: Robert J. Murphy, Peter C. Kober, & William P. Mekrut for Massachusetts Council of Human Services Providers, Inc., & others. John J. Barter for Professional Liability Foundation, Ltd. Carol A. Kelly for Property Casualty Insurers Association of America. Philip Todisco, Deborah Wayne, Sam Meas, Maria Dilibero, Jean Staropoli, Elizabeth Gruber, John Ribeiro, Dolores Ivette Kershaw, Robert Baskies, Michelle O’Leary, Betzada Rodriguez, Tony Vaughn, Dianne Argyris, Sarah Bokland Barnat, Dianne Martina Pinckney, Fran E. Rowan, and Edith Silva, individually and as directors of North Suffolk Mental Health Association, Inc.; and Donald Goff, Nancy McDonnell, DeShawn James Chappell, and the Commonwealth. Lenk, J. At the time of her death on January 20, 2011, twenty-five year old Stephanie Moulton was employed as a residential treatment counsellor at North Suffolk Mental Health Association, Inc. (North Suffolk), a charitable corporation that provides mental health and rehabilitation services. While at work at North Suffolk’s Revere treatment facility, Moulton was alone with DeShawn James Chappell, one of the facility’s residents, when Chappell assaulted Moulton, causing her death. Several months after her death, Moulton’s estate brought a wrongful death action, G. L. c. 229, § 2, in the Superior Court against the directors of North Suffolk (director defendants), two psychiatric consultants who had been involved in Chappell’s admission, the Commonwealth, and Chappell. Claiming that the defendants’ conduct was “willful, wanton, reckless, malicious and constituted gross negligence,” the complaint seeks punitive damages, and separately alleges a breach of fiduciary duty by the director defendants. The gravamen of the complaint against the director defendants is that, as a result of admissions and operating policies that they had effectuated, and others that they had failed to effectuate, those who evaluated clients for residential placement were unaware of Chappell’s lengthy history of convictions of violent crimes and his mental health history exhibiting a tendency toward violence. Moreover, as a result of such policies, staff at the facility, such as Moulton, were both unaware of Chappell’s history and unequipped to deal with individuals having such a history. The director defendants moved to dismiss the complaint chiefly on the grounds that, with respect to the wrongful death action, they are immune from suit, as Moulton’s employer, under the exclusive remedy provision, G. L. c. 152, § 24, of the Workers’ Compensation Act (act) and, with respect to the breach of fiduciary duty claim, they owed Moulton no such duty. The director defendants appealed the denial of their motion, and we transferred the case to this court on our own motion. In addition to determining that the interlocutory appeal is properly before us under the doctrine of present execution, we conclude that the director defendants, acting as Moulton’s employer when adopting or failing to adopt the workplace policies at issue, are immune from suit under the exclusive remedy provision of the act for injuries Moulton sustained while acting within the course of her employment. We conclude also that the directors, as Moulton’s employer, owed no fiduciary duty to their employee, and any corrective action for an alleged breach of their fiduciary duty to North Suffolk must be sought by the Attorney General. The complaint against the director defendants accordingly must be dismissed. Discussion. 1. Wrongful death claim. The complaint asserts that the director defendants were “responsible for setting, overseeing and enforcing policies, standards and criteria governing the screening and selection of [clients] for residence, treatment and services at [North Suffolk] facilities” (the admission policy) and were “responsible for setting, overseeing and enforcing policies, standards and criteria governing the qualifications, staffing and training of [North Suffolk] facilities in light of the conditions, situations and problems posed by its [clients]” (the operating policy). The complaint alleges that if the director defendants had allowed or required a proper examination of prospective clients, and provided access to information in the possession of referring agencies indicating prospective clients’ criminal histories and previous violent tendencies, Chappell would not have been deemed an appropriate client for admission to North Suffolk’s Revere facility. Further, had North Suffolk employees at that facility been given information about clients’ violent backgrounds, and had they been provided adequate training, staffing, and equipment for the appropriate handling of clients with violent criminal histories and violent tendencies, Moulton would not have been left alone with Chap-pell and she accordingly would not have been killed. Allegedly because of their own conflicts of interest, the director defendants failed to adopt policies that would have appropriately screened and selected clients and adequately provided for workplace safety; the policies they adopted or failed to adopt, due to these conflicts, knowingly increased the risk of harm to employees, clients, and the general public. The director defendants maintain that they may not be held individually and personally liable in a wrongful death action for injuries sustained by an employee of a charitable corporation in the course of employment where the corporation is not itself liable due to the exclusive remedy provision of the act. Here, North Suffolk is not liable because the wrongful death statute yields to the exclusive remedy provision of the act. See G. L. c. 229, § 2. Otherwise put, in cases in which an employee sues an employer for wrongful death damages, the provisions of that statute preclude “any civil action for wrongful death of an employee who is subject to the provisions of the workers’ compensation laws.” Peerless Ins. Co. v. Hartford Ins. Co., 48 Mass. App. Ct. 551, 554 (2000). Maintaining both that Moulton is an employee subject to the provisions of the act and that the term “employer” encompasses not only North Suffolk, but the director defendants as well, the latter assert that they are as a matter of law immune from this wrongful death action. a. Statutory scheme. Compensation under the act is the exclusive remedy for injuries to an employee suffered in the course of employment, regardless of the wrongfulness of the employer’s conduct, Foley v. Polaroid Corp., 381 Mass. 545, 551-552 (1980), or the foreseeability of harm. See Saab v. Massachusetts CVS Pharmacy, LLC, 452 Mass. 564, 567 (2008) (Saab). Enacted in 1911, the act was intended to guarantee that workers would receive payment for any workplace injuries they suffered, regardless of fault; in exchange for accepting the statutory remedies, the worker waives any common-law right to compensation for tort injuries. See St. 1911, c. 751, pt. 1, § 5, and pt. 5, § 1; Foley v. Polaroid Corp., supra at 548-549. “Unlike damages in torts, compensation under the act ‘is by way of relief from inability to earn, or for deprivation of support flowing from, wages theretofore received by the employee.’ ” Foley v. Polaroid Corp., supra at 552 n.5, quoting Ahmed’s Case, 278 Mass. 180, 183 (1932). The act eliminates piecemeal tort litigation and tort claims by individual workers, which are time-consuming, expensive, and afford no guarantee of compensation. See Foley v. Polaroid Corp., supra at 548-549. The bargain that is struck by the act provides predictability for both employee and employer, balancing protection for workers with certainty for employers. See Saab, supra at 567, and cases cited. While insured employers forfeit any defenses they might otherwise have had as to fault, they are protected from suit for workplace injuries, and thereby gain predictability and cost containment in conjunction with such injuries. See Wentworth v. Henry C. Baker Custom Bldg., Ltd., 459 Mass. 768, 773 nn.6, 7 (2011); Correia v. Firestone Tire & Rubber Co., Inc., 388 Mass. 342, 349-350 (1983). The so-called exclusivity provision of the act does not permit a covered employee both to recover compensation benefits under the act and to sue her employer to recover for an injury covered by the act. The exclusivity provision “has been the cornerstone of our Workers’ Compensation Act. Our exclusivity provision is very broad. The Legislature has had opportunities to narrow its scope, and has not done so.” Berger v. H.P. Hood, Inc., 416 Mass. 652, 656 (1993). While an employee need not forgo the right to bring common-law tort claims against her employer, and may instead waive any compensation payments under the act, an employee so choosing must notify the employer in writing, at the time of hire, that she does not waive the common-law right of action. See G. L. c. 152, § 24; Foley v. Polaroid Corp., supra at 548-549. The plaintiff’s complaint makes no allegation that Moulton waived her right to compensation under the act. So long as the injuries were sustained while the employee was acting in the course of her employment, as the plaintiff alleges happened here, actions for negligence, recklessness, gross negligence, and wilful and wanton misconduct by an employer are precluded by the exclusive remedy provision. See Saab, supra at 567-568; Fredette v. Simpson, 440 Mass. 263, 266 (2003); Carey v. Governors of Kernwood Country Club, 337 F. Supp. 2d 339, 342 (D. Mass. 2004). See, e.g., Decker v. Black & Decker Mfg. Co., 389 Mass. 35, 41 (1983) (“serious and willful misconduct” by employer); Dean v. Raytheon Corp., 399 F. Supp. 2d 27, 33 (D. Mass. 2005) (gross negligence); Sarocco v. General Elec. Corp., 879 F. Supp. 156, 161 (D. Mass. 1995) (intentional exposure to toxic chemicals). Actions against an employer under the wrongful death statute, G. L. c. 229, § 2, are likewise precluded by the exclusive remedy provision of the act. See Saab, supra at 570 n.9, 572; Peerless Ins. Co. v. Hartford Ins. Co., supra. The plaintiff maintains, however, that the director defendants were not Moulton’s employer and thus do not enjoy immunity from suit. b. Doctrine of present execution. Before considering the merits of the director defendants’ claims that, as Moulton’s employer, they are immune from suit under the wrongful death statute, we consider first whether the director defendants are entitled, by virtue of the doctrine of present execution, to pursue an interlocutory appeal of the denial of their motion to dismiss. An interlocutory order may be appealed under the doctrine of present execution “if the order will interfere with rights in a way that cannot be remedied on appeal from a final judgment.” Commonwealth v. Al Saud, 459 Mass. 221, 227 n.15 (2011), quoting Benoit v. Frederickson, 454 Mass. 148, 151-152 (2009). A defendant has the right to an immediate appeal under the doctrine of present execution where protection from the burden of litigation and trial is precisely the right to which it asserts an entitlement. Kent v. Commonwealth, 437 Mass. 312, 316-317 (2002). See Brum v. Dartmouth, 428 Mass. 684, 688 (1999), citing Matthews v. Rakiey, 38 Mass. App. Ct. 490, 493 (1995) (right to immunity from suit “would be ‘lost forever’ if an order denying it were not appealable until the close of litigation”). The doctrine of present execution requires that the immunity defense be collateral to the rest of the controversy. Maxwell v. AIG Domestic Claims, Inc., 460 Mass. 91, 106 n.12 (2011), citing Elles v. Zoning Bd. of Appeals of Quincy, 450 Mass. 671, 673-674 (2008). The director defendants assert such an immunity. The act “ ‘requires that participating employees waive their right to sue in tort for work-related injuries [in order to obtain compensation under the act].’ ... In other words, the employer ‘obtains an immunity from actions at law by his employees.’ ” Saab, supra at 567, quoting Murphy v. Commissioner of the Dep’t of Indus. Accs., 415 Mass. 218, 222 (1993), and L.Y. Nason, C.W. Koziol, & R.A. Wall, Workers’ Compensation § 26.1, at 313 (3d ed. 2003). “[T]he denial of a motion to dismiss on immunity grounds is always collateral to the rights asserted in the underlying action because it ‘is conceptually distinct from the merits of the plaintiff’s claim that his rights have been violated.’ ” Kent v. Commonwealth, supra at 317, quoting Mitchell v. Forsyth, 472 U.S. 511, 527-529 (1985). Therefore, regardless of whether the director defendants are correct in their assertion that they are employers immune from liability under the exclusive remedy provision, interlocutory appeal under the doctrine of present execution is permissible to challenge the denial of that contention. We turn to the director defendants’ substantive claims. c. Whether the director defendants are “employers” for purposes of the act. Given the act’s exclusive remedy provision, whether the plaintiff’s claims for wrongful death, and punitive damages due to gross negligence and willful, wanton, reckless, and malicious conduct, survive the director defendants’ motion to dismiss turns on whether the director defendants were Moulton’s “employer.” See Green v. Wyman-Gordon Co., 422 Mass. 551, 558 (1996), quoting Foley v. Polaroid Corp., 381 Mass. 545, 548-549 (1980) (“Common law actions are barred by the exclusivity provision of the workers’ compensation act where: ‘the plaintiff is shown to be an employee; his condition is shown to be a “personal injury” within the meaning of the [workers’] compensation act; and the injury is shown to have arisen “out of and in the course of. . . employment” ’ ”). Whether directors of a charitable corporation are “employers” for purposes of the act is a matter of first impression for this court. Under the act, “employers” may be individuals, corporations, or some combination of those in a joint enterprise. The act defines an “[ejmployer” as: “an individual, partnership, association, corporation or other legal entity, or any two or more of the foregoing engaged in a joint enterprise, and including the legal representatives of a deceased employer, or the receiver or trustee of an individual, partnership, association, corporation or other legal entity, employing employees subject to this chapter. . . . The word ‘employer’ shall include both the general employer and special employer in any case where both relationships exist with respect to an employee. The word ‘employer’ shall not include nonprofit entities, as defined by the Internal Revenue Code, that are exclusively staffed by volunteers. “A corporation and its subsidiary corporations shall be considered as one entity for the purposes of a self-insurance license; provided, however, that such corporation has signed as guarantor to insure payment of claims by its subsidiary coiporations.” G. L. c. 152, § 1 (5). Since the definition of employer states explicitly that nonprofit entities exclusively staffed by volunteers are not included in its provisions, the Legislature clearly considered, and intended to include, other nonprofit organizations and entities within the purview of “employers” under the act. The complaint in essence asserts that the director defendants have individual and personal liability for the plaintiff’s injuries, sustained while the plaintiff was acting within the course of her employment, because they voted to adopt and enforce certain workplace policies and client admissions polices, and failed or declined to adopt and enforce other safety policies and staffing and training requirements. Adoption of corporate policies is achieved by a vote of the board of directors as a whole, acting as the corporation, see Harhen v. Brown, 431 Mass. 838, 844-845 (2000); G. L. c. 156B, § 47 (“Except as reserved to the stockholders . . . , the business of every corporation shall be managed by a board of directors”), and cannot be accomplished in the ordinary course by any individual director. See Demoulas v. Demoulas Super Mkts., Inc., 424 Mass. 501, 562-563 (1997); Winchell v. Plywood Corp., 324 Mass. 171, 175-177 (1949); Restatement (Second) of Agency § 14C comment b (1958) (“An individual director. . . has no power of his own to act on the corporation’s behalf, but only as one of the body of directors acting as a board”). Cf. Boston Athletic Ass’n v. International Marathons, Inc., 392 Mass. 356, 364-365 (1984). “All corporate power shall be exercised by or under the authority of, and the business and affairs of the corporation shall be managed under the direction of, its board of directors. . . .” G. L. c. 156D, § 8.01 (b). A corporation “acts through its board of directors.” Aiello v. Aiello, 447 Mass. 388, 402 (2006). See J.D. Cox & T.L. Hazen, Law of Corporations § 9:6 (3d ed. 2010). See also Harhen v. Brown, supra at 844 (“as a basic principle of corporate governance, the board of directors . . . should set the corporat