Borchardt v. Kulick

• Decision Date: 08 June 1951
• Docket Number: No. 35409,35409
• Parties: BORCHARDT v. KULICK et al.
• Court: Minnesota Supreme Court

Page 318

48 N.W.2d 318

234 Minn. 308

BORCHARDT v. KULICK et al.

No. 35409.

Supreme Court of Minnesota.

June 8, 1951.

Syllabus by the Court.

1. Instructions unobjected to become the law of the case and, for the purposes of an appeal, must be taken as the law of the case, unless the record shows conclusively that the party recovering is not entitled to recover under any view of the law.

2. A contract for one year's services, commencing on the date of the contract, is not within the statute of frauds.

3. An oral contract for the performance of services for a term of one year, to begin in the future, is within the statute of frauds.

4. Where the terms of a contract are reaffirmed on the date when the services are to begin and extend for one year from that date, the contract is not within the statute of frauds.

5. Oral contracts which are within M.S.A. § 513.01 are not void in the strict sense that no contract ever comes into being, but are unenforceable at the option of the party against whom enforcement is sought.

6. The statute of frauds may be raised by a general denial.

7. The defense is personal to the party to be charged and his privies, and it may be waived.

8. Where it appears from the face of the complaint that the contract is within the statute of frauds, defendant must either demur to the complaint or assert the defense by general denial or by specifically pleading the statute, and in such case there is a waiver if he fails to object to the admission of oral evidence to prove the contract.

9. It is too late to raise the objection after a verdict by a jury or on a motion for a new trial.

10. An objection that the contract was within the statute may not be raised for the first time on appeal.

Ryan, Ryan, Ryan & Ebert, Brainerd, for appellant.

Carl E. Erickson, Brainerd, for respondent.

KNUTSON, Justice.

Appeal from an order denying defendant's alternative motion for judgment notwithstanding the verdict or for a new trial.

This action was brought by plaintiff against Apolonia Kulick and Alex Kulick, on the theory that they were partners in the operation of a garage in Brainerd, Minnesota, to recover for an alleged breach of an oral contract to employ plaintiff as a mechanic or foreman for a period of one year from July 1, 1948. Plaintiff recovered a verdict against Apolonia Kulick only, so she will be referred to hereinafter as defendant.

It is plaintiff's contention, and his complaint so alleges, that on or about June 26, 1948, plaintiff and defendant entered into an oral contract under the terms of which defendant agreed to employ plaintiff as foreman in her garage for a period of one year from July 1, 1948; that in consideration thereof he gave up the job he then held and commenced to work for defendant; that he was to work 50 hours a week; and that he was to receive $80 per week as wages, pay for holidays, a bonus of $50 at the end of each three-month period, the privilege of purchasing at cost the first Plymouth automobile of a designated type that arrived, and two weeks' vacation with pay at the end of the year. He then alleges and contends that at first he was paid according to the agreement, but that in December defendant began cutting his wages, refused to pay him for holidays, and refused to pay the promised bonus. He contends also that defendant refused to permit him to purchase a Plymouth automobile at cost, although such automobiles were received and were available, and that as a result of this failure to live up to the contract he quit work on January 8, 1949. He seeks to recover damages for breach of the contract.

Defendant admits that plaintiff was employed as he claims, but denies that the agreement was to run for a period of one year. She contends that his services were unsatisfactory; that on or about December 1, 1948, a new agreement was entered into at a reduced rate of pay; and that plaintiff was later discharged on account of the unsatisfactory nature of his services. She contends that he has been paid in full. The answer contains a general denial, as well as allegations setting forth the claims above mentioned.

Defendant now contends that the oral contract was within the statute of frauds and that the trial court erred in denying her motion for a directed verdict at the close of the case.

Defendant made no objection to the introduction of evidence at the opening of the trial, nor was the statute of frauds mentioned during the trial. Evidence of the oral contract was received without objection. No motion for a dismissal or directed verdict was made at the close of plaintiff's case, but when both parties rested defendant did move for a directed verdict upon the ground, among others, 'that under all the evidence adduced in the case the plaintiff has failed to prove a cause of action alleged in his complaint or any cause of action whatsoever, against the defendants or either of them.' The statute of frauds was not specifically mentioned in such motion. No request for instructions on the statute of frauds was made, and the court did not instruct the jury thereon. At the close of the court's instructions, counsel were asked if there were any exceptions. None were taken by counsel for either of the parties.

The statute of frauds was not specifically mentioned in the motion for judgment notwithstanding the verdict or for a new trial, but from the trial court's memorandum to its order denying the motion we assume that the matter was argued under the general statement that the verdict is contrary to law.

1. It is the general rule that instructions unobjected to become the law of the case and, whether right or wrong, must, for the purposes of an appeal, be taken as the law of the case. Kane v. Locke, 216 Minn. 170, 12 N.W.2d 495; Farnham v. Pepper, 193 Minn. 222, 258 N.W. 293; 1 Dunnell, Dig. & Supp. § 404. But this rule is not applicable where the record shows conclusively that the party recovering is not entitled to recover under any view of the law, as where the complaint shows conclusively that it cannot be helped by proof or amendment and that there is no cause of action. White v. Western Assur. Co., 52 Minn. 352, 54 N.W. 195; Chicago M. & St. P.R. Co. v. Sprague, 140 Minn. 1, 167 N.W. 124.

2--3--4. It therefore becomes important to determine whether there is any right to recover on an oral contract within the statute of frauds. This depends to a large extent on a determination of whether such contracts are void in the strict sense that no contract ever comes into being or is unenforceable or voidable at the option of the party sought to be charged.

The trial court was of the opinion that the evidence was conflicting on the question of when the contract was entered into, but the complaint alleges that it was made on June 26 and that the work was to commence on July 1. We shall assume, therefore, that the contract was not to be performed within one year and was within the statute of frauds. A contract for one year's services, commencing on the date of the contract, is not within the statute, O'Donnell v. Daily News Co., 119 Minn. 378, 138 N.W. 677, but an oral contract for the performance of services for a term of one year, to begin in the future, is within the statute of frauds. Lally v. Crookston Lbr. Co.,85 Minn. 257, 88 N.W. 846. Where the terms of a contract are reaffirmed on the date when the employe is to report for work and are to extend for a period of one year from that date, the contract is not within the statute of frauds. See, Restatement, Contracts, § 198, illustration 7.

5. The authorities in this country on the application and effect of our statute of frauds on the trial of an action based on a contract which comes within one of its provisions are far from uniform and likewise far from clear. ¹ An examination of our cases indicates that they are likewise quite unsatisfactory. ²

In considering our cases, we must keep in mind the language of three sections of our statute of frauds. M.S.A. § 513.01 reads:

'No action shall be maintained, in either of the following cases, upon any agreement, unless such agreement, or some note or memorandum thereof, expressing the consideration, is in writing, and subscribed by the party charged therewith:

'(1) Every agreement that by its terms is not to be performed within one year from the making thereof;

'(2) Every special promise to answer for the debt, default or doings of another;

'(3) Every agreement, promise, or undertaking made upon consideration of marriage, except mutual promises to marry;

'(4) Every agreement, promise or undertaking to pay a debt which has been discharged by bankruptcy or insolvency proceedings.' (Italics supplied.)

This section was originally Pub.Stat. 1849--1858, c. 50, § 2, which read:

'In the following cases, every agreement Shall be void, unless such agreement, or some note or memorandum thereof expressing the consideration, be in writing, and subscribed by the party charged therewith:

'1. Every agreement that by the terms is not to be performed within one year from the making thereof;

'2. Every special promise to answer for the debt, default or miscarriage of another person;

'3. Every agreement, promise or undertaking, made upon consideration of marriage, except mutual promise to marry.' (Italics supplied.)

This section was taken verbatim from our territorial laws. R.S.1851, c. 63, § 2. By G.S.1866, c. 41, § 6, the language was changed so that it is identical with our present § 513.01, and it has remained so without change since that time, except that paragraph (4) was added by R.L.1905, c. 68, § 3483.

M.S.A. § 512.04 is derived from Pub.Stat. 1849--1858, c. 50, § 3, where it read as follows:

'Every contract for the sale of any goods, chattels or things in action, for the price of fifty dollars or more, Shall be void, unless,

'1. A note or memorandum of such contract, be made in writing and subscribed by the parties to be charged therewith; or,

'2. Unless...