Lindsey v. M.A. Zeccola & Sons, Inc.

• Decision Date: 09 June 1994
• Docket Number: No. 93-7426,93-7426
• Citation: 26 F.3d 1236
• Parties: 128 Lab.Cas. P 57,699 Susan R. LINDSEY, Appellant, v. M.A. ZECCOLA & SONS, INCORPORATED, a Delaware corporation; M.A. Zeccola, Appellees.
• Court: U.S. Court of Appeals — Third Circuit

Page 1236

26 F.3d 1236

128 Lab.Cas. P 57,699

Susan R. LINDSEY, Appellant, v. M.A. ZECCOLA & SONS, INCORPORATED, a Delaware corporation M.A. Zeccola, Appellees.

No. 93-7426.

United States Court of Appeals Third Circuit.

Argued Feb. 17, 1994.

Decided June 9, 1994.

Marc P. Niedzielski (argued), Donald J. Detweiler, White & Williams, Wilmington, DE, for appellant.

David A. Roeberg (argued), Roeberg & Associates, Wilmington, DE, for appellees.

Before BECKER, HUTCHINSON and COWEN, Circuit Judges.

OPINION OF THE COURT

HUTCHINSON, Circuit Judge.

In this diversity case appellant Susan R. Lindsey ("Lindsey"), a licensed real estate agent, appeals an order of the United States District Court for the District of Delaware granting summary judgment in favor of her former employer, appellees M.A. Zeccola & Sons, Inc. and Michael A. Zeccola (collectively and individually "Zeccola"). She asserts the district court erred in concluding the statute of frauds barred her claim for breach of an eighteen month employment contract. Lindsey also asserts the court erred in concluding the one year statute of limitations barred her claim for a sales commission. She contends a three year statute of limitations which would not bar her claim applies.

We hold the district court correctly concluded Delaware's statute of frauds barred Lindsey's breach of contract claim and we will affirm that part of its order. We agree with Lindsey, however, that the district court should have applied the three year statute of limitations to her commission claim. We will therefore reverse the part of the district court's order granting summary judgment to Zeccola on Lindsey's claim for a sales commission. ¹

I. Statement of Facts and Procedural History

The facts, viewed in the light most favorable to Lindsey, follow. In 1989, Zeccola sought to hire a person to sell homes at its development in Hampton Pointe, Delaware ("Hampton Pointe"). At the time, Lindsey worked for another broker on a straight commission basis but was looking for a position which would provide her with a steadier income.

Lindsey and Michael Zeccola first met at Zeccola's home in November of 1989. They next met at Zeccola's Hampton Pointe office on November 29, 1989 and discussed benefits, salary and commission. Lindsey informed Zeccola she was not willing to work weekends and Zeccola responded he did not expect her to do so. Zeccola handed Lindsey a typed document containing the terms of proposed employment. The document proposed alternative terms of a weekly salary plus commission, or a straight commission with weekly draws against commission. Lindsey told Zeccola neither proposal was acceptable.

Lindsey and Zeccola met again on December 4, 1989 at the Hampton Pointe office. Zeccola handed Lindsey a one-page, handwritten proposal headed "calculated on 18 month's," ² containing the word "Susan," Lindsey's telephone number and the date "1/24/90" across the top. Appendix ("App.") at 2. Below this information were two columns, each describing a different pay option. Lindsey testified at her deposition that Zeccola, when he presented the proposal to her, said "this is a contract for 18 months, and this is what I am willing to pay you [left column]. This [right column] is what you wanted, and this [left column] is what I am willing to pay." Lindsey v. M.A. Zeccola & Sons, Inc., No. 92-283-SLR, slip op. at 2 (D.Del. May 24, 1993). Lindsey testified she responded that she "accepted that contract [the left column] for 18 months of employment at that salary and those terms." Id. Neither Lindsey nor Zeccola signed the proposal. Lindsey also says they discussed weekend work and Zeccola understood that she was not going to work every weekend because "our original plan was that I was to have off every other weekend." Id. at 3.

Lindsey began working for Zeccola on February 2, 1990. Lindsey testified her hours were Monday through Thursday 1:00 p.m. to 5:00 p.m., with Fridays off and work on weekends from either 11:00 a.m. or 12:00 noon to either 4:00 p.m. or 5:00 p.m. Lindsey claims she procured buyers for a home in Hampton Pointe. On May 3, 1990 the buyers, Rakesh K. and Beeny Gupta (collectively the "Guptas") signed a sales contract, conditioned on their ability to obtain certain financing arrangements. Zeccola fired Lindsey on May 17, 1990, allegedly because Lindsey did not work in April on either Easter weekend or the weekend thereafter. On November 28, 1990, Zeccola and the Guptas held a settlement meeting and the Hampton Pointe sale was closed. Lindsey received no commission.

On May 12, 1992 Lindsey, a Pennsylvania resident, filed suit against Zeccola, a Delaware resident, claiming damages in excess of $50,000 for breach of contract, wrongful discharge and emotional distress. Zeccola denied the existence of any employment contract beyond one for employment at-will and moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) or for summary judgment pursuant to Federal Rule of Civil Procedure 56. The district court granted Zeccola's motion for summary judgment as to all claims on May 24, 1993. Lindsey filed a timely notice of appeal on June 17, 1993.

II. Statement of Jurisdiction and Standard of Review

The district court had subject matter jurisdiction over this diversity case pursuant to 28 U.S.C.A. Sec. 1332 (West 1993). We have appellate jurisdiction over the district court's final order pursuant to 28 U.S.C.A. Sec. 1291 (West 1993). We apply the substantive law of the forum state, Delaware. ³ Clark v. Modern Group Ltd., 9 F.3d 321, 326 (3d Cir.1993).

When reviewing an order granting summary judgment we exercise plenary review and apply the same principles the district court should have initially applied. Under Federal Rule of Civil Procedure 56(c), we ask whether there are any genuine issues of material fact and, if not, whether the moving party is entitled to judgment as a matter of law. Gray v. York Newspapers, Inc., 957 F.2d 1070, 1078 (3d Cir.1992). We view the facts in the light most favorable to the nonmoving party and draw all inferences in that party's favor. Id. The evidence, however, must be sufficient for a jury to return a verdict in favor of the nonmoving party; if it is merely colorable or not significantly probative, the court should grant summary judgment. Id.

III. The Statute of Frauds Issue

Lindsey argues that the district court erred in concluding her breach of contract claim was barred by Delaware's statute of frauds. It provides:

Sec. 2714. Necessity of writing for contracts; definition of writing; evidence.

(a) No action shall be brought to charge any person upon any agreement ... that is not to be performed within the space of one year from the making thereof ... unless the contract is reduced to writing, or some memorandum, or notes thereof, are signed by the party to be charged therewith, or some other person thereunto by him lawfully authorized in writing....

Del.Code Ann. tit. 6, Sec. 2714(a) (1993). ⁴

Lindsey argues the statute is satisfied by five written documents when they are considered together with the parties' testimony and other evidence and that her part performance brings this eighteen month contract within the part performance exception to the statute. The five documents include the two written proposals; Lindsey's federal employment eligibility verification form; a document containing copies of Lindsey's pay stubs and canceled pay checks; and a document containing copies of canceled checks drawn on Zeccola's account for health insurance reimbursements that were signed by him and made payable to Lindsey.

In Delaware a collection of several writings, only one of which is signed, may satisfy the Delaware statute of frauds. Abramson v. Delrose, Inc., 132 F.Supp. 440, 442 (D.Del.1955). In determining whether any particular writing or writings satisfy the statute, Delaware relies on section 131 of the Restatement (Second) of Contracts which requires that at least one of the writings be signed by the party to be charged and that all the writings taken together:

(a) reasonably identif[y] the subject matter of the contract,

(b) [are] sufficient to indicate that a contract with respect thereto has been made between the parties or offered by the signer to the other party, and

(c) state[ ] with reasonable certainty the essential terms of the unperformed promises in the contract.

Restatement (Second) of Contracts Sec. 131 (1981); see Kirschling v. Lake Forest Sch. Dist., 687 F.Supp. 927, 931 (D.Del.1988).

It is undisputed that Zeccola's signature appears on some of the five documents. The dispute is over the other three requirements of Restatement section 131. After the district court reviewed all the documents, it held that none of them, singly or together, sufficiently identified the subject matter, duration, job description or hours of employment with the precision needed to satisfy the statute:

Plaintiff's first unsigned document ... contains two different salary proposals. Since plaintiff did not accept either of these proposals, it cannot be considered as identifying the subject matter of the contract. Plaintiff's second unsigned document ... also sets forth two salary proposals. Although plaintiff eventually accepted one of the two proposals on this page, the document standing alone is deficient since 1) defendant did not sign it and 2) it fails to set forth any specific terms of employment. Moreover, the notation "calculated on 18 month's" does not conclusively demonstrate an offer for an 18-month contract.

Plaintiff's employment verification form ... payroll records ... and canceled checks for health insurance ... all fail to provide job description, hours or other terms of employment. Moreover, none of these three documents contain any internal or direct connection with each other or with the first two documents.

Lindsey, slip op. at 7.

Lindsey argues that the district court erred in making...