Business Law 11th Edition by Kenneth Clarkson,Roger LeRoy Miller,Gaylord Jentz,Frank Cross

تمرين 7

Sawyer v. Mills
Court of Appeals of Kentucky, 2007. __ S.W.3d __.
WINE, Judge.
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[Barbara] Sawyer was employed as a paralegal in [Melbourne Mills, Jr.'s] law firm.* * *
* * * [Since 1994] Mills had promised to reward her for her assistance in instituting class action lawsuits. However, the parties never specified any amount the bonus might be or when the bonus would be forwarded to Sawyer other than when "the ship comes in." * * *
After the Fen-Phen [class action was resolved and Mills's firm got a substantial] settlement, Sawyer, her husband Steve Sawyer ("Steve"), and Mills all met together on June 25, 2001. Sawyer and Steve secretly recorded the conversation.* * * [T]he tape recording confirms that she and Steve initially asked Mills for a One Million Dollar ($1,000,000.00) lump sum bonus, which Mills quickly rejected. But following much encouragement from Steve and Sawyer, Mills did agree to pay Sawyer a bonus of One Million Dollars ($1,000,000.00) plus the cost of a new luxury car which all agreed would be another Sixty-Five Thousand Dollars ($65,000.00). The full amount was to be paid in monthly installments, on the first of each month, until paid in full. The tape recording and Sawyer's testimony both confirm the parties'dollar amount and the agreed payment plan.* * * [T]he bonus was to be paid in monthly installments of Ten Thousand Dollars ($10,000.00).
During the June 25, 2001 recorded conversation with Sawyer and Steve, Mills also agreed to sign a writing verifying the parties' agreed-to terms of the bonus. * * * Sawyer's attorney, Mark Moseley, drafted an agreement per the parties' request, but Mills never signed.* * *
[Mills paid Sawyer $65,000 in amounts ranging from $10,000 to $15,000 between the June 25 conversation and February 2002, plus a single payment of $100,000 in October 2001. After the payments stopped, Sawyer filed a suit in a Kentucky state court against Mills, claiming that he had reneged on his promise to pay the bonus.]
Mills filed a motion for summary judgment prior to trial, arguing that Sawyer's claims were barred by the statute of frauds. In an order entered on December 1, 2005, the trial court conceded that Sawyer's claims would seem to run afoul of the statute. After reflection, the trial court denied the motion and allowed Sawyer to present her full evidence at trial before a jury. The jury found that Mills had entered into an oral contract for the bonus, and returned a verdict in favor of Sawyer in the amount of Nine Hundred Thousand Dollars ($900,000.00). Thereafter, Mills filed a motion for [a judgment notwithstanding the verdict (JNOV)], again arguing that any agreement between him and Sawyer is barred by the statute of frauds. The trial court agreed and granted the motion.
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On appeal [to a state intermediate appellate court], Sawyer argues that enforcement of the agreement between her and Mills was not barred by the statute of frauds. As codified in [Kentucky Revised Statutes (KRS)] 371.010, the statute of frauds provides that no action shall be brought to charge any person "[u]pon any agreement that is not to be performed within one year from the making thereof * * * unless 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." Because he never signed the written contract, Mills contends that Sawyer cannot recover on his oral representations.
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Sawyer * * * argues that the statute of frauds was not applicable because the agreement was capable of being performed within one year. As outlined above, the parties' agreement was clearly that Mills would pay Sawyer Ten Thousand Dollars ($10,000.00) a month for a period of one hundred and seven (107) months. The tape recording of the parties' conversation on June 25 and the testimony of Sawyer, Steve and their attorney Moseley and his draft agreement all confirm these contemplations by the parties. Thus, it is safe to conclude that, pursuant to the undisputed testimony at trial from Sawyer, Steve, attorney Moseley, and the draft agreement, Mills never agreed to pay the lump sum bonus amount or make any kind of pre-payments towards the bonus. While Sawyer concedes that the parties did not contemplate performance in less than one year, she contends that the agreement did not preclude such performance either. Thus, she contends that the agreement does not violate the statute of frauds.
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* * * [G]enerally, if a contract could be performed within a year from the time it was made, the statute of frauds does not apply, even if its performance might have extended beyond that point. However, * * * when it is contemplated by the parties that the contract is not to be performed within the year, regardless of whether it was possible of performance within that time, the contract comes within the inhibition of KRS 371.010(7). * * * [I]n this case Sawyer and Mills clearly anticipated that the bonus would be paid over a series of one hundred and seven (107) months from the making of the agreement on June 25, 2001. As this period is more than one year, the statute of frauds applies to bar enforcement of the agreement.
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After considering the evidence in a light most favorable to Sawyer * * * , we are persuaded that the evidence supports the finding of the trial court that the JNOV was appropriate in this case. Undisputed testimony from Sawyer, Steve and attorney Moseley and his draft agreement of the parties' June 25 conversation, coupled with the tape recording of that conversation, all confirm that the parties agreed the bonus would be paid in monthly installments over one hundred and seven (107) months. The tape recording clearly shows that Mills never intended to pay Sawyer the bonus as a lump sum and Sawyer is recorded agreeing to the monthly payments. The parties never contemplated that the bonus would be paid within one year. * * * As such, the statute of frauds bars Sawyer's claim against Mills as she produced no writing signed by Mills agreeing to the oral promise to pay her the bonus.
Accordingly, the order of the [lower] Court granting the JNOV is affirmed.
1. Would an oral agreement between Sawyer and Mills to begin the bonus's installment payments on a certain date-July 1, 2001, for example-and complete them no later than fifteen months from that date have been outside the one-year rule of the Statute of Frauds
2. Sawyer contended that the writing requirement of the Statute of Frauds was met through the combination of the recording of the parties' conversation on June 25 and the checks Mills signed to Sawyer totaling $165,000. Obviously, the court did not agree. Why not