Young v. Ward

Decision Date06 March 1996
Docket NumberNo. 10-95-001-CV,10-95-001-CV
Citation917 S.W.2d 506
PartiesGeoffrey YOUNG, Appellant, v. Travis WARD, Appellee.
CourtTexas Court of Appeals

William B. Short, Jr., Mark Frels, Short, How, Lozano, Frels & Tredoux, L.L.P., Dallas, for appellant.

Frederick M. Loeber, Jr., Dallas, for appellee.

Before CUMMINGS and VANCE, JJ.

OPINION

CUMMINGS, Justice.

This is a breach of contract case. At trial, appellant Geoffrey Young sought to enforce an oral contract between him and appellee Travis Ward whereby Ward, Young's former employer, had allegedly agreed to pay Young a pension of $2000 per month for the rest of Young's life. Ward moved for summary judgment on the grounds that the alleged oral contract was unenforceable under the statute of frauds. TEX.BUS. & COMM.CODE ANN. § 26.01 (Vernon 1987). The trial court granted the motion, prompting Young to bring this appeal. We reverse and remand.

The two parties differ widely in their versions of the events which led to this lawsuit. According to Young, beginning in 1956 and continuing until the end of October 1985, Young worked for Ward as an office manager and bookkeeper. Starting in or about 1969, he began to feel concerned that Ward had not yet established some provision for his retirement income. He, therefore, brought the subject up to Ward, who assured Young that he had no need to be concerned about a lack of a retirement income and that Ward would provide one for Young when the time came. Nevertheless, despite repeated protests from Young, Ward never attempted to finalize a formal agreement with Young until either late September or early October of 1985 when Young was only a few weeks from his last day of employment. At that time, again according to Young, Ward offered to pay Young $2000 per month for the rest of Young's life. Young argues that the consideration for the agreement was that Young would continue to work for Ward until the end of October. The negotiations were oral and the agreement was never reduced to writing.

Ward agrees that Young worked for him from 1956 until the end of October 1985 as an office manager and bookkeeper, but this essentially is where the similarity between his story and Young's ends. According to Ward, his decision to offer Young a pension arose from an effort to keep Young in his employment when Ward was relocating his offices from Corsicana to Dallas sometime between 1971 and 1973, not from concerns expressed by Young about a lack of a retirement plan. Young did not want to move to Dallas and was reluctant to commute; accordingly, in an effort to persuade him to continue in his employment, Ward offered to provide Young a company car and gas so that Young could make the commute from Corsicana without any financial expense. Furthermore, as an added incentive, Ward decided to offer Young a retirement plan. Ward consulted an insurance agent, Gara Stark, who analyzed certain figures and offered certain suggestions to Ward on what might be feasible options for him and Young. Ward decided not to accept any of the suggestions from Stark; instead, he orally offered to pay Young $2000 per month for eight years once Young retired. According to Ward, Young orally accepted this offer in 1973, but it was never reduced to writing.

The parties agree that Young retired at the end of October 1985 and that Ward paid Young $2000 per month for eight years following Young's retirement. Young brought his lawsuit when Ward informed him in or about October 1993 that he would cease making payments to Young the following month.

In his motion for summary judgment, Ward contended the oral agreement between him and Young was unenforceable because it was not to be performed within one year from the date of the making of the agreement, as provided in our state's statute of frauds. TEX.BUS. & COMM.CODE ANN. § 26.01(b)(6). Ward raised two arguments in support of his theory: first, he contended that any contract for lifetime is, per se, barred by the statute of frauds; second, he argued that, since the date of the contract's making was in 1973, more than one year would necessarily have had to elapse before the contract could be performed because Young was not due to retire until twelve years later in 1985. The trial court granted summary judgment solely on the former argument; consequently, we can only consider it and not the latter. State Farm Fire & Cas. Co. v. S.S., 858 S.W.2d 374, 380 (1993); McDuff v. Chambers, 895 S.W.2d 492, 497 (Tex.App.--Waco 1995, writ denied).

On appeal from the granting of summary judgment, we must determine whether the evidence establishes as a matter of law that there is no genuine issue of material fact. Rodriguez v. Naylor, 763 S.W.2d 411, 413 (Tex.1989); Hamlin v. Gutermuth, 909 S.W.2d 114, 116 (Tex.App.--Houston [14th Dist.] 1995, writ denied). In deciding whether a genuine issue of material fact exists, the evidence must be viewed in favor of the nonmovant, resolving all doubts and indulging all inferences in his favor. Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548 (Tex.1985). A defendant as a movant must either: 1) disprove at least one element of each of the plaintiff's theories of recovery; or 2) plead and conclusively establish each essential element of an affirmative defense. City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 679 (Tex.1979). Ward in his summary judgment motion raised the affirmative defense of the statute of frauds. The question before us, then, is whether oral lifetime contracts are unenforceable under the statute of frauds. We conclude that they are not.

Construing the facts in the light most favorable to Young, we find that in late September or early October 1985 Ward offered to pay Young $2000 per month for the rest of Young's life if Young would continue to work for Ward until the end of October 1985. Young accepted the offer, but the agreement was never reduced to writing.

Section 26.01(b)(6) of the Business and Commerce Code provides that, to be enforceable, promises or agreements "which [are] not to be performed within one year from the date of making the agreement" must be in writing. TEX.BUS. & COMM.CODE ANN. § 26.01(b)(6). Agreements which demand performance at or for a specified amount of time are easily determined by the court to fall or not fall under the strictures of section 26.01(b)(6). Bratcher v. Dozier, 162 Tex. 319, 346 S.W.2d 795, 796 (1961) (question of whether an agreement falls within the statute of frauds is one of law). The court simply compares the date of the agreement to the date when the performance under the agreement is to be completed and if there is a year or more in between them then a writing is required to render the agreement enforceable. Gilliam v. Kouchoucos, 161 Tex. 299, 340 S.W.2d 27, 28-29 (1960) (employment contract for ten years within statute); Chevalier v. Lane's, Inc., 147 Tex. 106, 213 S.W.2d 530, 533 (Tex. 1948) (employment contract for term of one year and several weeks within statute); Paschall v. Anderson, 127 Tex. 251, 91 S.W.2d 1050, 1051 (1936) (same); Shaheen v. Motion Indus., Inc., 880 S.W.2d 88, 91 (Tex.App.--Corpus Christi 1994, writ denied) (employment contract for nine months not within statute); International Piping Sys., Ltd. v. M.M. White & Assoc., Inc., 831 S.W.2d 444, 451 (Tex.App.--Houston [14th Dist.] 1992, writ denied) (employment contract for one year performable within one year and therefore not within statute); Wiley v. Bertelsen, 770 S.W.2d 878, 881-82 (Tex.App.--Texarkana 1989, no writ) (employment agreement for approximately ten years within statute); M.R.S. Datascope Inc. v. Exchange Data Corp., Inc., 745 S.W.2d 542, 544 (Tex.App.--Houston [1st Dist.] 1988, no writ) (covenant not to compete for three years within statute); Levine v. Loma Corp., 661 S.W.2d 779, 781-82 (Tex.App.--Fort Worth 1983, no writ) (agreement to employ employee for over one year and then pay him $1000 per month for life thereafter within statute).

Agreements where the time at or for performance is not specifically provided but can be readily ascertained from the context of the agreement can also be easily determined to be within or outside section 26.01(b)(6). Schroeder v. Texas Iron Works, Inc., 813 S.W.2d 483 (Tex.1991) (employment contract until retirement, which was eight to ten years from date of agreement's making, was within statute); Niday v. Niday, 643 S.W.2d 919, 920 (Tex.1982) (agreement fell within statute where performance under agreement would take at least two years); Hall v. Hall, 158 Tex. 95, 308 S.W.2d 12, 15 (1957) (employment contract with no specified duration was within statute where the parties intended it to last for a reasonable time and where the jury determined the parties at the time the agreement was made intended it to be about three years); Leon Ltd. v. Albuquerque Commons Partnership, 862 S.W.2d 693, 702 (Tex.App.--El Paso 1993, no writ) (writing was required where performance under agency agreement, although for an unspecified term, could not possibly be completed within three years from date of agreement); Winograd v. Willis, 789 S.W.2d 307, 310-11 (Tex.App.--Houston [14th Dist.1990, writ denied) (employment contract of unspecified duration determined to be for one year and therefore not within statute where the terms of the agreement indicated that employee was to receive an annual salary); Benoit v. Polysar Gulf Coast, Inc., 728 S.W.2d 403, 406-07 (Tex.App.--Beaumont 1987, writ ref'd n.r.e.) (employment contract until retirement for employee several years younger than retirement age within statute); Gano v. Jamail, 678 S.W.2d 152, 154 (Tex.App.--Houston [14th Dist.] 1984, no writ) (indefinite duration agreement between plaintiff lawyers to share profits from personal injury cases required a writing because the work on the cases could not reasonably be completed within one year from the date the cases were taken); Molder v. Southwestern Bell Tel. Co., 665 S.W.2d 175, 177 (Tex.App...

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