Grauer v. Valve & Primer Corp.

• Decision Date: 31 March 1977
• Docket Number: No. 76--156,76--156
• Citation: 361 N.E.2d 863,5 Ill.Dec. 540,47 Ill.App.3d 152
• Parties: , 5 Ill.Dec. 540 Paul W. GRAUER, Plaintiff-Appellee, v. VALVE AND PRIMER CORPORATION, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

Page 863

361 N.E.2d 863

47 Ill.App.3d 152, 5 Ill.Dec. 540

Paul W. GRAUER, Plaintiff-Appellee, v. VALVE AND PRIMER CORPORATION, Defendant-Appellant.

No. 76--156.

Appellate Court of Illinois, Second District.

March 31, 1977.

Leoris & Cohen, Drake Leoris, Chicago, for defendant-appellant.

Donald J. Kolp, Paul W. Grauer, Schaumberg, for plaintiff-appellee.

RECHENMACHER, Presiding Justice.

The plaintiff, Paul W. Grauer, filed an action against his former employer, Valve and Primer Corporation (hereafter, the 'Corporation'), seeking damages for the breach of an employment contract, a recovery in Quantum meruit, and an accounting to determine the amount owed him under the contract. After a bench trial, the court entered judgment for Grauer in the amount of $4,200. On appeal, the Corporation contends that the judgment of the trial court was against the manifest weight of the evidence. We affirm the trial court's judgment.

Grauer is a registered engineer and tax attorney. He was employed by the Corporation in August of 1972, as an assistant to its president, V. B. Dickson. In this position, he functioned both as a legal adviser and as an engineer. During 1972 he worked under an oral contract of employment, at an annual salary of $18,000.

In December of 1972, the Corporation's president sent the following letter to Grauer:

'TO: Paul Grauer

FROM: V. B. Dickson

SUBJECT: Your 1973 Salary

Thank you for a job well done in 1972. Here is your Salary Contract for 1973.

.75% On all Sales (i.e. Billings) You will receive a monthly draw of $1,600.00. We expect to ship between $3,000,000 and $4,000,000 in 1973 with our new plant, equipment and personnel. And of course with everyone having a year more experience.

Please sign and return one copy to me.

/s/ V. B. Dickson

V. B. Dickson, President

Valve and Primer Corp.

I understand and agree to the above.

By: _ _

Date: _ _'

Grauer returned the letter without signing it. Dickson then mailed it back to Grauer with a memo dated January 18, 1973, which stated:

'Attached guarantees you a minimum of $22,500 in 1973--more likely $24,000 plus--because I look for $3,500,000 sales (i.e. Shipments).

I review it annually based on performance.'

Grauer then, on February 1, 1973, signed and dated the original letter, and sent it to Dickson. On July 23, 1973, Grauer received a letter from Dickson, which congratulated him and told him to 'keep up the good work'. Grauer was fired six weeks later.

The Corporation's first contention is that Grauer's contract of employment was terminable at will, and that the Corporation therefore had the right to dismiss him at any time, without liability. They note that a hiring at a monthly or annual salary, if no duration is specified in the contract, is presumed to be at will and either party may terminate the hiring at his pleasure without liability. (Long v. Arthur Rubloff & Co. (1975), 27 Ill.App.3d 1013, 1023, 327 N.E.2d 346.) Here, however, Dickson's memo 'guarantees' Grauer 'a minimum of $22,500 in 1973', a sum which, in view of the Corporation's projected and actual business volume, could only accumulate if Grauer were allowed to remain in employment for a full year. The memo also stated that the contract would be reviewed 'annually', again raising a strong inference that a contract of a year's duration was intended.

Counsel for the Corporation conceded during oral argument that this language from Dickson's memo supports an inference that a contract of annual duration, not terminable at will, was intended. However, he asserts that the memo, which was in Dickson's handwriting and indisputably authored by him, is not pertinent because Dickson did not sign it. The Corporation also contends that the contract between the parties was oral, and therefore not governed by the terms of Dickson's letter and memo.

We observe that the memo had no independent purpose, but was obviously intended to clarify the terms of Dickson's earlier letter, which had been signed, and was enclosed with it. The memo may properly be regarded as but an addition to the letter; there was thus no reason for exacting a requirement that both be signed. (Cf. Iser Electric Co. v. Ingram Construction Co. (1976), 44 Ill.App.3d 640, 642--643, 3 Ill.Dec. 269, 358 N.E.2d 667.) (Supplemental contract and accompanying note given for same purpose and in course of same transaction, held 'to be regarded as one'; also, changes in contract held effective, even though not initialed.) Further, the lack of a signature does not constitute a 'magic' bar to the enforcement of the terms of an agreement, even where the agreement is within the Statute of Frauds. (See, E.g., Welsh v. Jakstas (1948), 401 Ill. 288, 299--300, 82 N.E.2d 53; Wielander v. Henich (1965), 64 Ill.App.2d 228, 232--233, 211 N.E.2d 775.) Under these circumstances, we see no reason whatever for disregarding the cogent evidence of the terms of Grauer's employment which the memo supplies, merely because Dickson neglected to sign said memo.

The Corporation's contention that the contract with Grauer was entirely oral, strikes us with some surprise, since the Corporation admitted in its answer that Dickson's memo was a 'written salary contract', and there is nothing in the record to indicate that this was not the case. The Corporation has also argued that, since Grauer was an attorney hired as 'in-house counsel', he was subject to dismissal at will. Since it is clear from the record that Grauer's legal duties were secondary and merely incidental to his management and engineering functions, we need not explore this assertion. On this record, in view of the clear indications in Dickson's letter and memo that the parties did not intend Grauer's contract to be terminable at will, the trial court was not in error in holding that the contract was of annual duration.

The Corporation maintains that Grauer was dismissed for good cause, since he 'breached his fiduciary duty' by operating a private practice of law while serving as an assistant to the president. It is not...