Case ID: ad_2/html/0173-01.html
Source: Caselaw Access Project
Author: {"author": "Ingraham, J.:\n    ", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Martin A. H. Thelberg, Respondent, v. The National Starch Manufacturing Company, Appellant.
    
      Pleading-tissues as to the assumption by one corporation of the obligation of another — the Statute of Frauds must be pleaded.
    
    In an action brought to recover the damages resulting from a breach of contract for services, the complaint set forth two contracts made by the Glen Cove Manufacturing Company, under which the plaintiff was employed for a term of five years, unless the company should discontinue its business, in which event the company might declare the - agreement void, and alleged that the ' company was “absorbed” by the defendant; that the plaintiff was notified by the defendant of the consolidation of the two companies, and that thereafter Ms employment would be by the defendant at the yearly salary of 82,500, upon the same terms and conditions set forth in the contracts above mentioned, and that the defendant agreed to pay the salary and ratified the employment.
    The answer denied this allegation as to the plaintiff’s employment being continued by the defendant, but in no manner pleaded the Statute of Frauds.
    -It appeared that the Glen Cove Manufacturing Company had not availed itself of its option to declare the agreement void.
    
      .Held, that the only question presented by the pleadings was whether or not the defendant had assumed the obligation of the Glen Cove Manufacturing Company to employ the plaintiff as provided in the agreement made between him and that company;
    That if, for any reason, the Statute of Frauds constituted a defense to the plaintiff’s claim the defendant could not avail himself of it, as he had not pleaded the statute.
    Where the Statute of Frauds is not pleaded it must be regarded as waived.
    Appeal by the defendant, The Hational Starch Manufacturing Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Hew York on the 29th day of May, 1895, upon the verdict of a jury rendered after a trial at the Hew York Circuit, and also from an order entered in said clerk’s, office on' -the 8th day of June, 1895, •denying the defendant’s motion for a new trial made upon the minutes.
    The complaint in this action alleged that, by a contract entered . into on the 1st day of April, 1889, as supplemented by one executed July 9, 1889, the Glen Cove Manufacturing Company agreed to employ the plaintiff for the term ••of five years from the 1st day of April, 1889.
    
      That on or about the 1st do^ of Hay, 1890, the defendant was organized, and the Glen Cove Manufacturing. ' Conrpany was “ absorbed ” by it; that on the last-mentioned date the plaintiff was notified by the defendant that the said Glen Cove Manufacturing Company had consolidated with, and been absorbed by, the defendant, and that thereafter his employment would be by the defendant at the yearly salary of $2,500, and upon the terms and conditions set forth in the contracts above referred to.
    The complaint further alleged that the plaintiff continued in the employ of the defendant until- the 30th day of Hay, 1891, when he was unlawfully discharged, without fault on his part, and asked damages for the breach of the contract.'
    The answer admitted that at the times alleged' in the complaint tire plaintiff was in the employ of the defendant, but denied -that it had any knowledge as to the arrangement between the plaintiff and the Glen Cove Manufacturing Company, and specifically denied that the Glen Cove Manufacturing Company had been absorbed by the defendant, and that it had notified the plaintiff that thereafter his employment would be by the defendant at the .yearly salary of $2,500, upon the terms and conditions specified in the contracts ■above referred to, and alleged that the defendant had not ratified ■any previous employment of the plaintiff.
    Upon the trial the jury found in favor of the plaintiff, and from the judgment entered ofi the verdict this appeal is taken.
    
      William J. Kelly, for the appellant.
    
      Theron L. Carman^ for the respondent.
   Ingraham, J.:

Before discussing the main question argued on this appeal, namely, that of the application of the Statute of Frauds, it will be well to notice the claim by the defendant that the plaintiff failed to prove any contract on the part of the defendant to employ him for a term of years ending April 1,. 1894. Though it appears from a provision, of the contract that should the said company at any time for any reason discontinue its business, said company might at its option Rave declared the agreement void, it is clear, as a matter of fact that the Glen Cove Manufacturing Company did not exercise that option to declare the agreement void.

The complaint alleges that the Glen Cove Manufacturing Company was absorbed by the defendant. We suppose that means that the two companies were in some way consolidated and the business transacted by the Glen Cove Manufacturing Company continued by the defendant; but it appears that after such consolidation the plaintiff continued to perform the same work for the defendant that he had performed for the Glen Cove Manufacturing Company. He testified that he was told by the superintendent of the defendant that the contract held good with the new company the same as with the old company. It was this statement that the jury believed, and under this statement it was competent for the jury to find that when the defendant absorbed ” the Glen Cove Manufacturing Company it absorbed its assets, and at the same time bound itself to ca!rry out its contract to discharge its liabilities. Under the plaintiff’s contract with the Glen Cove Manufacturing Company there was an obligation on behalf of the company to employ the plaintiff for a-term of .five years, unless that company discontinued 'its business, when the company could, at its option, declare the agreement void. The Glen Cove Company’s business and assets Avere transferred to this defendant. The Glen Cove- Company did not declare the agreement void, and the defendant expressly agreed Avith the plaintiff that the contract held good with the new company, Avhich was simply assuming with the assets of the old company one of its liabilities.

The contract gave the Glen Cove Company the option to declare the agreement void, and unless that option was exercised by the Glen Cove Company, the agreement remained in full force and effect; and it is not claimed that the Glen Cove Company ever exercised that option. It is only necessary to prove in this action, to entitle the plaintiff to recover, that the defendant assumed in some way the existing liability of the Glen Cove Company to carry out this contract -with the plaintiff; and if the eAndence of the plaintiff is to be believed, such an agreement was made

Assuming that the agreement of the defendant to adopt the contract between the plaintiff and the Glen Cove Company was one that was jreauired by the Statute of Frauds to be in writing—although we do not decide that question — we do not think that under the authorities in this State the question was- presented properly to the court below.

The complaint expressly alleges the two contracts made by the Glen Cove Company, copies of which are annexed thereto.' It then ■ alleges that the plaintiff was notified by the defendant of the .consolidation of the two companies,. “ and that thereafter his employment would be by said defendant at the yearly salary of $2,500, and upon the same terms and condition's set forth in .said Contracts ‘ A ’ and B,’ which said., salary the defendant agreed to pay and employment it ratified.”- The- a-nswpr denies this allegation. The Statute of Frauds, however, is not'jii'daded, nór is it alleged in the answer that if this agreement was made by the defendant it was ■invalid or illegal for any reason. The pleadings present the one issue as to whether or not the defendant did assume, the obligation of the Glen Cove Company to employ this plaintiff as provided in the agreement between that cómpany and this .plaintiff., That was ■ the only question raised by the pleadings, and that was the question to be tried.

When the plaintiff was examined as á witness and asked to detail the conversation between himself and the superintendent of the defendant,-that was objected to by the defendant. Ho ground was stated in the objection and the point was not then, taken that this testimony was invalid under the Statute of Frauds to prove a con- ■ tract which was not to be performed within one_year. The attention of the court was not directed by any objection, to the evidence that the contract contravened the statute, and as the statute has not been pleaded, it is clear that such an objection is unavailing on-appeal. Plaintiff testified that the superintendent said “ that my contract held good with the new company, the same as with the old company.” To that there was no objection, the only objection having been the former one taken by the. defendant, with no ground, specified and no attention called to this statute as the ground of the objection, nor the objection that the testimony itself was incompetent to prove the agreement alleged in the complaint taken.

It is now settled in this State that the Statute of Frauds cannot be taken- advantage of as a defense to an action upon a contract which, is required by that statute to be in writing,, Unless notice is given of that intention to the opposing party by the pleadings. In Crane v. Powell (139 N. Y. 388) O’Brien, J., in delivering the opinion of the court, says: “When a contract is set out in the complaint as the cause of action, and the defendant intends to assail it on some special or statutory ground, the general spirit of the system is not complied with unless notice is given of this intention to the opposing party by the pleadings.”

Here there was an existing contract between the plaintiff and the Glen Cove Company. There was an express agreement between the plaintiff and the superintendent of the defendant that this contract should continue and be assumed by the defendant. That contract was sued upon ; evidence was admitted without raising the specific objection of the Statute of Frauds ; the Statute of Frauds was not pleaded in the action. It followed that, the defendant having waived the statute, the case was properly submitted to the jury, and that upon its verdict the plaintiff was entitled to judgment. There does not seem to be any errcr made as to the admission or rejection of testimony, and, we think, the judgment was right and should be affirmed, with costs.

Van Brunt, P. J., Williams and O’Brien, JJ., concurred.

Judgment affirmed, with costs.