McGehee v. South Carolina Power Co.

• Decision Date: 12 April 1938
• Docket Number: 14666.
• Parties: McGEHEE v. SOUTH CAROLINA POWER CO.
• Court: South Carolina Supreme Court

196 S.E. 538

187 S.C. 79

McGEHEE v. SOUTH CAROLINA POWER CO.

No. 14666.

Supreme Court of South Carolina

April 12, 1938

Appeal from Common Pleas Circuit Court of Charleston County; E. C Dennis, Judge.

Action by C. G. McGehee against the South Carolina Power Company for fraudulent breach of an oral contract of employment. From an order granting defendant's motion for a nonsuit plaintiff appeals.

Reversed and remanded for a new trial.

BAKER J., dissenting.

J. C. Long and M. L. McCrae, both of Charleston, for appellant.

Hagood, Rivers & Young, of Charleston, for respondent.

STABLER Chief Justice.

It is sought in this action to recover damages in the sum of $10,000 for a claimed fraudulent breach of an oral contract. The plaintiff alleges that during the month of November, 1929, while in the discharge of his duties as an employee of the defendant, he was seriously injured by an explosion due to defective equipment furnished him by his employer; that soon thereafter an agent of the defendant called upon him and agreed that, if he would not sue for the injuries which he had sustained in the explosion, the company would pay him the sum of $50 in cash for the damage that had been done his clothing, and "would give him a continuous and steady job as long as he performed his work properly," and that, relying upon such representations and promises, he accepted the $50 and executed a release; that on April 30, 1931, the plaintiff "was discharged or laid off by the said defendant company without any just cause, reason or excuse, as far as his work was concerned." The defendant denied having entered into any such agreement, pleaded a general release executed by McGehee "for the sole consideration" of $113.75, and set up the defense of the statute of frauds.

The plaintiff, on trial of the case, offered testimony tending to establish the allegations of his complaint. He stated that the defendant's representative, one Hastings, after assuring him that the company would pay for the damage done to his clothing, said: "I tell you what you do Mack if you don't sue us and give us a release I will promise you you will have a job the rest of your life as long as the power company has a job as long as you do your work properly"; that his employment was to be perpetual, the agent assuring him "of a permanent job"; and that, relying upon such promise, the witness signed the release and was paid the sum of $50.

Mrs. McGehee stated that she was present when the conversation between her husband and the company's agent took place, and that "Mr. Hastings told my husband if he would not enter suit against the company he would receive $50.00 for his clothing and always have a lifetime job as long as the company had one if he proved himself satisfactory in every respect."

When the plaintiff rested his case, the defendant moved for a nonsuit on the ground that the only inference to be drawn from the testimony was that the contract sued on "is a permanent lifetime job, which is a contract within the contemplation of the parties not to be performed within the space of a year," and, therefore, is within the statute of frauds. Judge Dennis granted the motion, and the only question raised by the exceptions is whether he committed error in doing so.

The pertinent portion of section 7044 of the Code of 1932, commonly known as the statute of frauds, is as follows: "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 agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, and signed by the party to be charged therewith, or some person thereunto by him lawfully authorized."

In determining when contracts come within the above-quoted provision of the statute, the courts have been governed by the words "not to be performed," treating them as negative words. It is therefore generally held that "to bring a particular contract within the statute there must be a negation of the right to perform it within a year." 27 C.J. 174.

In Thompson v. Gordon, 3 Strob. 196, the court said: "The statute of frauds, when it enacts that 'any agreement that is not to be performed within the space of one year, from the making thereof,' shall be in writing, means an agreement not to be performed in the space of a year, and expressly so stipulated. A contingency is not within the statute-it must appear, within the agreement, that it is not to be performed till after the year, to make a note in writing necessary." And in Gadsden v. Lance, McMul. Eq. 87, 37 Am.Dec. 548, the syllabus correctly states the holding of the court as follows: "It is well settled, that when the agreement is to be performed on a contingency, which may or may not happen within the year, a note in writing is not necessary, unless it appear from the agreement, that it was to be performed after the year." But see Walker v. Railway Co., 26 S.C. 80, 1 S.E. 366, 371, where it was pointed out that the case of Jones v. McMichael, 12 Rich. 176, "may be regarded as relaxing so much of the rule as requires that it shall expressly appear in the agreement itself that the parties contemplated a contract which was not to be performed within a year, but that such a purpose may be inferred from other circumstances."

With regard to a contingency stated in a contract upon which the time of the contract's duration depends, it is generally held that, where an oral agreement of employment in terms provides for its continuance during the lifetime of the employee, the contract is not within the statute.

In 25 R.C.L. 478, the rule is thus stated: "The general view taken in this country is that a contract for personal services for an indefinite time, the length of which is dependent on some contingency, as in case of contracts to employ one for the duration of his life, is not within the statute, as the death of the person by whom the services are to be rendered will operate as a full performance of the contract. This is held true as to a contract to give one 'permanent' employment or the like, so long as the employee...