Brudnicki v. General Elec. Co.

• Decision Date: 24 February 1982
• Docket Number: No. 81 C 4014.,81 C 4014.
• Citation: 535 F. Supp. 84
• Parties: Hilary R. BRUDNICKI, Plaintiff, v. GENERAL ELECTRIC COMPANY, a foreign corporation, Defendant.
• Court: U.S. District Court — Northern District of Illinois

535 F. Supp. 84

Hilary R. BRUDNICKI, Plaintiff, v. GENERAL ELECTRIC COMPANY, a foreign corporation, Defendant.

No. 81 C 4014.

United States District Court, N. D. Illinois, E. D.

February 24, 1982.

Tim Bridge, Oak Brook, Ill., for plaintiff.

Arthur B. Smith, Vedder, Price, Kaufman & Kammholz, Chicago, Ill., for defendant.

MEMORANDUM OPINION AND ORDER

ASPEN, District Judge:

Plaintiff, Hilary R. Brudnicki, an Illinois citizen, initiated this action against defendant, General Electric Company ("G.E."), a foreign corporation, in the Circuit Court of the Eighteenth Judicial Circuit, DuPage County, Illinois. The case was subsequently removed as a diversity action to the Northern District of Illinois pursuant to 28 U.S.C. § 1441(a) and (b). Plaintiff's four-count complaint seeks recovery for damages suffered as a result of his discharge from G.E. in alleged breach of an oral contract of employment entered between the parties on or about February 28, 1977. Presently before the Court is defendant's motion to dismiss all four counts of plaintiff's amended complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.

A complaint will not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to the relief requested. Cruz v. Beto, 405 U.S. 319, 322, 92 S.Ct. 1079, 1081, 31 L.Ed.2d 263 (1972); Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957). As the Seventh Circuit has noted:

Under the Federal Rules of Civil Procedure, it is well established that, on a motion to dismiss, a complaint must be construed in the light most favorable to the plaintiff, the allegations thereof being taken as true; and if it appears reasonably conceivable that at trial the plaintiff can establish a set of facts entitling him to some relief, the complaint should not be dismissed.

Mathers Fund, Inc. v. Colwell Co., 564 F.2d 780, 783 (7th Cir. 1977). Applying this standard to the present case, defendant's motion to dismiss Counts I, II and IV will be denied and defendant's motion to dismiss Count III will be granted.

COUNT I

Count I of plaintiff's complaint alleges that his dismissal from G.E. on August 19, 1980, breached the terms and conditions of discharge established under an oral employment contract entered between the parties in 1977.¹ The oral contract at issue allegedly provided that plaintiff would be discharged from employment only if he failed to comply with the lawful directives of the defendant and only after G.E. gave plaintiff advance warning of the consequences of his failure to comply with those directives. Although defendant cannot at this stage dispute plaintiff's allegation that these terms were breached by defendant's conduct, G.E. has argued in its motion to dismiss that the oral contract is void and unenforceable under the Illinois Statute of Frauds. Ill.Rev.Stat.1979, ch. 59, § 1.²

Under Illinois law, a contract is unenforceable only if it is impossible of performance within one year. Sinclair v. Sullivan Chevrolet Co., 45 Ill.App.2d 10, 14, 195 N.E.2d 250 (3d Dist. 1964). Defendant's Statute of Frauds argument is predicated in part on language in plaintiff's original verified complaint which suggested that the oral employment agreement between the parties would extend over 24 years until plaintiff retired at age 65. Complaint, Count I, ¶¶ 4-5. This characterization, if true, would render the employment agreement void under the Statute of Frauds because full performance could not be completed within one year. Cf. Gilliland v. Allstate Insurance Co., 69 Ill.App.3d 630, 633, 26 Ill.Dec. 444, 388 N.E.2d 68 (1st Dist. 1979). Plaintiff argues, however, that because his employment with G.E. was to last "as long as Plaintiff ... substantially complied with all the lawful directions of Defendants," First Amended Complaint, Count I, ¶ 5, plaintiff's obligations under the agreement could be fully performed within one year.

Viewed from the time the employment relationship began, plaintiff presumably could have ended his compliance with G.E.'s directions and have been terminated under the terms of the agreements before the end of the first year. The issue, then, is whether the potential of this termination is sufficient to render the agreement capable of being fully performed within one year.

The possibility of an employee's termination within one year does not necessarily remove the employment contract at issue from the reach of the Statute of Frauds. Sinclair, supra 45 Ill.App.2d at 14-15, 195 N.E.2d 250. Similarly, the possibility that an employee may die or resign within the first year does not necessarily save the oral agreement from the bar of the Statute. Gilliland, supra 69 Ill.App.3d at 633, 26 Ill.Dec. 444, 388 N.E.2d 68. Such contingencies threaten the longevity of any employment relationship. Whether the possibility of an employee's death or termination takes the employment agreement from the bar of the Statute in a specific case depends in large part on the underlying purpose and specific terms of the agreement itself. Cf. George F. Mueller & Sons, Inc. v. Northern Illinois Gas Co., 12 Ill. App.3d 362, 367, 299 N.E.2d 601 (1st Dist. 1973); Balstad v. Solem Machine Co., 26 Ill.App.2d 419, 422-23, 168 N.E.2d 732 (2d Dist. 1960); Osgood v. Skinner, 111 Ill.App. 606, 617-18 (1st Dist. 1904). The facts necessary for this Court to make such a determination are not presently before us.³

Defendant moves to dismiss Count I on the alternative theory that if this employment agreement was of indefinite duration in terms of time, it must have been terminable at will under Illinois law. Therefore, defendant reasons, G.E.'s dismissal of plaintiff without just cause was merely an exercise of its right to terminate an employee under state law. This interpretation overlooks, however, that an employment relationship terminable at will in Illinois is subject to the termination provisions of the employment contracts at issue. Criscione v. Sears, Roebuck & Co., 66 Ill. App.3d 664, 667, 23 Ill.Dec. 455, 384 N.E.2d 91 (1st Dist. 1978). Cf. Pleasure Driveway & Park District of Peoria v. Jones, 51 Ill. App.3d 182, 190, 9 Ill.Dec. 677, 367 N.E.2d 111 (3d Dist. 1977). The employment agreement alleged here, for example, expressly provided that termination could occur only after plaintiff failed to comply with defendant's lawful directives and after plaintiff was given adequate notice. In this context, therefore, plaintiff has alleged a claim upon which relief may be granted.

Defendant argues finally that Count I fails to state a claim upon which relief can be granted because the underlying contract is void for lack of mutuality of obligation between the parties. Specifically, defendant's position appears to be that plaintiff's promise to and performance of the duties of employment for which he was paid is not sufficient consideration to support G.E.'s additional contractual promise to permanently employ plaintiff under a termination provision more limited than terminable at will. The sufficiency of plaintiff's consideration in return for G.E.'s promise of "permanent" employment is, however, a question of fact which the Court cannot resolve on a motion to dismiss.⁴

Accordingly, defendant's motion to dismiss Count I is denied on all grounds.

COUNT II

Count II of the amended complaint alleges that plaintiff relied to his detriment on G.E.'s fraudulent misrepresentation that it would continue to employ plaintiff if he moved to Illinois and if he substantially complied with its directions during the course of that employment. First Amended Complaint, ¶¶ 5-6. In addition to the arguments raised and rejected herein for a dismissal of Count I, defendant moves to dismiss Count II on an additional ground.⁵ Specifically, defendant argues that plaintiff cannot sustain Count II in the absence of an allegation that G.E. misrepresented a pre-existing or present material fact. This argument rests on the general rule that a promise to perform a future act, even if not an accurate reflection of present intention, is not sufficient to constitute fraud in Illinois.

It is true as a general rule in Illinois that a promise to perform a future act, even if accompanied at the time with an intention not to perform that act, is not a false representation as will constitute fraud. Roda v. Berko, 401 Ill. 335, 340, 81 N.E.2d 912 (1948). However, a false representation of intent to perform an act in the future is actionable in Illinois when that representation is the scheme used to accomplish the fraud. Carroll v. First National Bank of Lincolnwood, 413 F.2d 353, 358-59 (7th Cir. 1969), cert. denied, 396 U.S. 1003, 90 S.Ct. 552, 24 L.Ed.2d 494 (1970); Wilhoite v. Fastenware, Inc., 354 F.Supp. 856, 858 (N.D.Ill. 1973); Steinberg v. Chicago Medical School, 69 Ill.2d 320, 334, 13 Ill.Dec. 699, 371 N.E.2d 634 (1977); Willis v. Atkins, 412 Ill. 245, 260, 106 N.E.2d 370 (1952). In some respects, this exception appears to "engulf and devour much of the general rule." Vance Pearson, Inc. v. Alexander, 86 Ill. App.3d 1105, 1112, 42 Ill.Dec. 204, 408 N.E.2d 782 (4th Dist. 1980). In any event, the Court is persuaded that the misrepresentation alleged here can be characterized fairly as part of a scheme to defraud and does state a claim for which relief can be granted. According to plaintiff's allegations, G.E.'s misrepresentation was a deliberate device to induce plaintiff to enter this agreement to his detriment. The misrepresentation was an integral step in achieving the agreement. Moreover, the misrepresentation alleged here related to the binding character of the agreement reached between the parties as well as G.E.'s intention to engage in particular future conduct. In this respect, therefore, the misrepresentation involved an allegedly untrue statement of present fact as well as future intention. Accordingly, def...