Putnam v. Producers' Live Stock Marketing Ass'n

• Decision Date: 09 November 1934
• Parties: PUTNAM v. PRODUCERS' LIVE STOCK MARKETING ASS'N.
• Court: Kentucky Court of Appeals

75 S.W.2d 1075

256 Ky. 196

PUTNAM v. PRODUCERS' LIVE STOCK MARKETING ASS'N.

Court of Appeals of Kentucky

November 9, 1934

Appeal from Circuit Court, Jefferson County, Common Pleas Branch Fourth Division.

Action by H. D. Putnam against the Producers' Live Stock Marketing Association. Judgment for defendant, and plaintiff appeals.

Reversed.

Hickman & Withers, of Louisville, for appellant.

Lawrence L. Koch and Herman G. Handmaker, both of Louisville, for appellee.

STANLEY Commissioner.

The plaintiff, now appellant, H. D. Putnam, alleged that on or about January 16, 1931, he and the defendant, now appellee Producers' Live Stock Marketing Association, entered into an agreement by which he was employed as a live stock salesman for the term of one year beginning February 1, 1931 at a salary of $3,300. and his moving expenses from Cincinnati to Louisville; that he had continued his services under that contract until September 15, 1931, when the defendant notified him that they were no longer required and refused to permit him to perform his contract thereafter. He sued for a balance of $1,482.90 of the annual salary charged to be due him. When a demurrer was sustained to his petition as amended and he declined to plead further, it was dismissed, and he has appealed.

The writing relied upon by the plaintiff to take the case out of that part of the statute of frauds barring an action upon an oral agreement which is not to be performed within a year from the making thereof is the following letter:

"Dear Mr. Putnam: This is to confirm our telephone conversation of yesterday, noon.

The Board acted upon the recommendation that you be employed as sheep and calf salesman for the Producers' Live Stock Marketing Association of Louisville, Kentucky, at a salary of $3,300.00 a year, plus moving expenses from Cincinnati to Louisville. Of course, this means only the truck hire.

This recommendation was accepted by a vote of the Board, and you will please consider yourself an employee, to begin work on February 1, 1931, at the above salary.

Assuring you that it is a pleasure of mine, as Manager, to have you with us, I am,

Yours very truly,

[Signed] C. E. Houk,

"C. E. Houk, Manager,

"Producers' Live Stock Marketing Assn."

It is contended by the appellant that this letter is sufficient to meet the requirements of the statute that "the promise, contract, agreement, representation, assurance, or ratification, or some memorandum or note thereof, be in writing, and signed by the party to be charged therewith, or by his authorized agent." The trial court was of the opinion that, since the duration of the time of the contract or period of service was not stipulated, the writing is lacking in an essential element and does not meet the requirement of the statute that the memorandum of agreement contain substantially all material elements necessary to make a binding contract. At most, thought the court, the contract established or ratified by the letter was for employment for an indefinite time and was terminable at the will of either party. Unless a definite period of one year's employment can be spelled out of the writing, the conclusions are sound and supported by authorities. Smith v. Theobald, 86 Ky. 141, 5 S.W. 394, 395, 9 Ky. Law Rep. 449; Louisville & N. Railroad v. Offutt, 99 Ky. 427, 36 S.W. 181, 18 Ky. Law Rep. 303, 59 Am. St. Rep. 467; Yellow Poplar Lumber Company v. Rule, 106 Ky. 455, 50 S.W. 685, 20 Ky. Law Rep. 2006; Tracy v. Deshon, 157 Ky. 226, 162 S.W. 1116; Bowen v. Chenoa-Hignite Coal Company, 168 Ky. 588, 182 S.W. 635; Morris Shoe Company v. Coleman, 187 Ky. 837, 221 S.W. 242. The case is therefore resolved into ascertaining the intention of the parties through interpretation of the writing in the respect indicated.

The communication confirms a conversation between the parties without reciting any of it; advises the approval by the board of directors of the recommendation that Putnam be employed as a salesman "at a salary of $3,300 a year, plus moving expenses from Cincinnati to Louisville," and that he should consider himself employed to begin work "at the above salary." The controlling issue is whether these provisions are sufficient to show an intention to employ the plaintiff for the definite period of a year.

It may be said generally that a contract of employment is not incapable of enforcement on the ground of indefiniteness merely because the precise period that the service shall continue is not specified. The English doctrine as laid down by Blackstone is that: "If the hiring be general, without any particular time limited, the law construed it to be a hiring for a year, upon the principle of natural equity, that the servant shall serve and the master maintain him throughout all the revolutions of the respective seasons, as well when there is work to be done as when there is not." 1 Commentaries, 425. This principle or presumption, at first adopted more or less in this country, has been generally repudiated by nearly all our courts, and it may be said that the American doctrine is that an indefinite or general hiring is prima facie a hiring at will which either party may at any time terminate. But it is everywhere recognized that there can be no inflexible rule in this respect. The duration of the employment must be treated always as an open question, to be determined by the circumstances of each particular case, or as one which is dependent upon the understanding and intent of the parties to be ascertained by inference from their written or oral negotiations (as the case may be), the usages of business, the situation and object of the parties, the nature of the employment, and all the circumstances surrounding the transaction. Labatt, Master and Servant, §§ 156, 159; 18 R. C. L. 508; 39 C.J. 43 et seq., notes, 8 Ann. Cas. 280; Annotations, 11 A. L. R. 469, 480; Smith v. Theobald, supra; Morris Shoe Company v. Coleman, supra. Compare, Miller v. N.W. Ritter Lumber Company, 110 S.W. 869, 33 Ky. Law Rep. 698; Bridgeford & Company v. Meagher, 144 Ky. 479, 139 S.W. 750; Stewart Dry Goods Company v. Hutchison, 177 Ky. 757, 198 S.W. 17, L. R. A. 1918C, 704; Newark Shoe Stores Company v. Kemmis, 207 Ky. 226, 268 S.W. 1114; Hospital College of Medicine v. Davidson, 140 Ky. 776, 131 S.W. 1004; Mogg v. Farley, 205 Ky. 25, 265 S.W. 449; Atkins v. Atkins' Adm'r, 203 Ky. 291, 262 S.W. 268.

Controlled by that general concept or canon of construction, it seems to be rather uniformly held that the circumstances of agreeing on weekly, monthly, quarterly, or semiannual payments of wages is sufficient of itself to establish the presumption of a hiring for the period covered by each payment. But, when the agreement was for employment at a specified compensation per year, the decisions are not in accord as to the effect of such provision in relation to the duration of the contract. There is a line of cases holding that employment at a certain sum per month or year is so indefinite as to constitute only a contract terminable at will. The editor of the annotations in 11 A. L. R. 469, says that practically all of those cases have without argument followed a certain text-book which laid down that proposition without judicial authority to support it. Regardless of the origin of this divergence as disclosed by those notes and otherwise, there is now quite respectable authority establishing that to be a proper rule of construction. On the other hand, there are cases to the effect that the stipulation of compensation at a certain annual sum will of itself warrant the conclusion that the employment was for a year. 1 Labatt, Master and Servant, § 165, p. 528; Moline Lumber Company v. Harrison, 128 Ark. 260, 194 S.W. 25, 26, 11 A. L. R. 466. The Arkansas court in that case accepted as the best view, and that which is sustained by the weight of authority, to be that,...