St. Louis Trading Co. v. Barr

Decision Date01 May 1934
Docket NumberCase Number: 21785
Citation32 P.2d 293,168 Okla. 184,1934 OK 273
PartiesST. LOUIS TRADING CO. et al. v. BARR.
CourtOklahoma Supreme Court
Syllabus

1. Frauds, Statute of--Oral Contract of Employment not to Be Performed Within Year.

An oral contract of employment not to be performed within a year is within the statute of frauds (Sub. 1, sec. 9455, O. S. 1931).

2. Same--Oral Contract not Taken out of Statute by Part Performance.

Part performance of a parol contract for personal services, which services are not to be performed within a year, does not take the contract out of the statute of frauds.

3. Same--Equity May Prevent Statute Being Used as Instrumentality to Perpetrate Fraud.

The statute of frauds was designed to prevent frauds, and courts of equity may in proper cases prevent the same being used as an instrumentality to perpetrate a fraud.

4. Same--Estoppel--Right to Urge Equitable Estoppel to Preclude One From Asserting Statute of Frauds as Defense.

It is an indispensable element of equitable estoppel that the person relying thereon must have been induced to act or alter his position to his detriment or injury, and where equitable estoppel is relied on to preclude another from asserting the statute of frauds as a defense to an oral contract not to be performed within a year, such injury must he unjust and unconscionable, and such that there is no complete and adequate remedy at law available to the person asserting the equitable estoppel.

5. Same--Burden of Pleading and Proof on Party Asserting Equitable Estoppel.

The burden of pleading and proving the facts constituting equitable estoppel rests upon the person who relies upon the same as the basis of his claim or defense.

6. Same--Burden of Proof Held not Sustained.

Record examined, and held, that the evidence is insufficient to establish a resulting unjust and unconscionable injury to the plaintiff who relies on equitable estoppel to prevent the defendants from asserting the statute of frauds.

7. Appearance--General Appearance by Filing Motion for New Trial Upon Nonjurisdictional Grounds.

A motion for a new trial filed by a defendant after judgment upon nonjurisdictional grounds constitutes a general appearance and confers upon the court jurisdiction over the person of the defendant which relates back to the date of trial.

Appeal from District Court, Washington County; J. R. Charlton, Judge.

Action by Hattie Barr against the St. Louis Trading Company et al. Judgment for plaintiff, and defendants appeal. Reversed, with directions.

Samuel A. Boorstin, E. L. O'Neil, and J. F. Conway, for plaintiffs in error.

Yancey, Spillers & Fist, J. Wood Glass, and Pennel & Harrison, for defendant in error.

BUSBY, J.

This action was commenced on November 18, 1928, in the district court of Washington county by Hattie Barr as plaintiff, against the St. Louis Trading Company, a partnership composed of Nathan Greenberg and Phillip Levine, and against such partners individually, as defendants.

The plaintiff seeks to recover damages for the alleged breach of an oral contract to employ her for a period of 22 months. Counsel for the plaintiff concede that the contract falls within the statute of frauds. They contend, however, that the defendants are estopped to assert the statute of frauds as a defense under the facts in this case.

The trial of the case to a jury in the lower court resulted in a judgment for the plaintiff. The defendants appear herein as plaintiffs in error. For convenience the parties will be referred to in this opinion as they appeared in the trial court.

An examination of the record discloses that the evidence of the plaintiff tends to establish the following facts: In January of 1928, the plaintiff, Hattie Barr, was the owner of a general merchandise store at Nowata, Okla. She offered to sell her stock and fixtures to the defendant, St. Louis Trading Company, for $ 7,000. The defendant refused to pay that sum, but orally offered to pay $ 5,000 and to employ the plaintiff as clerk for a period of 22 months at a salary of $ 30 per week. This offer was orally accepted.

The $ 5,000 was paid to plaintiff and the stock of merchandise and fixtures were delivered to the defendants, together with an executed bill of sale thereto. The defendants continued in business at Nowata for a period of two weeks, at the end of which time they sold out. During the two weeks that defendants operated their business at Nowata they employed plaintiff at the salary agreed upon. After they had disposed of their store they refused and failed to give plaintiff further employment.

The plaintiff in her petition pleads the oral contract and breach thereof. The defendants in their answer denied making any agreement to employ the plaintiff for any definite length of time, and as an additional defense asserted that such a contract, if made, was in violation of the statute of frauds and therefore unenforceable. The plaintiff filed a reply in which she asserted that by reason of the "facts pleaded herein" (apparently referring to the statements contained in her petition) the defendants were estopped to plead the statute of frauds.

The plaintiff neither alleged in her pleadings nor established by her evidence that the value of the stock of goods which she parted with was greater than $ 5,000, the amount which she received for the same. Neither did she plead or prove that she was deriving a fixed income from the operation of the store nor did she establish that she could not re-enter a similar business with equal chances of financial success. In other words, the plaintiff's evidence tended to establish that, by reason of defendants' promise to employ her for a period of 22 months, she was induced to alter her position, but it wholly fails to establish that this change of position resulted in any detriment to the plaintiff. The importance of this failure of proof will become obvious as we proceed to apply the law to the facts involved.

The sufficiency of the plaintiff's evidence was challenged at the close thereof by a demurrer interposed by the defendants. It was again questioned at the close of all of the evidence by a motion foe a directed verdict. Both the demurrer to the evidence and motion for directed verdict were overruled by the trial court, to which rulings of the trial court the defendants excepted.

Subdivision one of section 9455, O. S. 1931, provides:

"The following contracts are invalid, unless the same, or some note or memorandum thereof, be in writing and subscribed by the party to be charged, or by his agent:
"First: An agreement that, by its terms, is not to be performed within a year from the making thereof."

A contract of employment which cannot be performed within one year fails within the above-quoted section of the statute of frauds. 27 C. J. 186, par. 112. Contracts which are not to be performed within a year are not taken out of the statute by part performance. It is conceded by the parties that the contract of employment involved in this case, being impossible of performance within a year, is within the statute and that it is not removed therefrom by part performance. It is the contention of the plaintiff, in support of the judgment of the trial court, that, under the facts as pleaded and proved, the defendants were estopped from claiming the benefit of the statute above referred to.

In support of her position the plaintiff relies principally upon the case of Seymour v. Oelrichs, 156 Cal. 782, 106 P. 88, 134 Am. St. Rep. 154. A careful examination of that case discloses that it is clearly distinguishable from the case at bar. In the cited case the plaintiff, Seymour, had a life position as captain of detectives in the city of San Francisco at a monthly salary of$ 250. On the strength of an oral promise made by an agent of the defendant to employ him for a period of ten years at a monthly salary of $ 300 per month, Seymour was induced to resign his lifetime job. The defendants breached the contract of employment, and when sued by Seymour for breach of contract pleaded the statute of frauds. In passing upon the case, the California court held that the defendant was estopped to plead the statute of frauds for the reason that the plaintiff had altered his position to such an extent by reason of the oral promise that a plea of the statute of frauds would result in an unjust and unconscientious injury to the plaintiff. In that case the court said:

"* * * It was the change of position caused by his resignation from the police department upon which his claim wholly rests * * *"

--and also:

"The injury done plaintiff by a repudiation of the promise by the defendants under these circumstances would certainly appear to be unjust and unconscientious. * * *"

As we have previously observed, the plaintiff in the case at bar did not establish that her change of position resulted in an "unjust or unconscientious" injury, or in fact any injury at all. As far as the record is concerned she may have received all that her store was worth or may have succeeded in disposing of an unprofitable business.

Unquestionably, in a proper case, a party may be estopped to plead the statute of frauds. Pomeroy's Equity Jurisprudence (2d Ed.) pars. 2253, 1293, 859, 921, and 421. Estoppel to claim the statute as a defense in such cases is based upon equitable principles. The statute of frauds is designed as an instrument to prevent frauds, and a court of equity may prevent a party from taking advantage of the statute to perpetrate a fraud. The very essence of equitable estoppel is the resulting prejudice to the party who invokes the doctrine. Spencer v. First National Bank...

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