Case Title: Stuart Mackay v. Four Rivers Packing Co. Breach of oral contract employment

Citation: 

Docket Number: 33829

State: idaho

Court: Idaho Supreme Court (civil)

Date: 2008-02-19T00:00:00Z

Document:
IN THE SUPREME COURT OF THE STATE OF IDAHO 
 
Docket No. 33829 
 
 
STUART MACKAY, an individual,                    
                                                   
          Plaintiff-Appellant,                     
                                                   
v.                                                 
                                                   
FOUR RIVERS PACKING CO., an Idaho 
corporation,     
                                                   
          Defendant-Respondent.                    
                                                   
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Boise, January 2008 Term 
 
2008 Opinion No. 27 
 
Filed:  February 19, 2008 
 
Stephen W. Kenyon, Clerk 
 
Appeal from the District Court of the Third Judicial District of the State of Idaho, 
for Washington County.  Hon. Stephen W. Drescher, District Judge. 
 
The district court’s order granting summary judgment is vacated and the case is 
remanded.   
 
Johnson & Monteleone, L.L.P., Boise, for appellant.  Samuel Johnson argued. 
 
Birch Law Office, Payette, for respondent.  Bruce H. Birch argued.  
 
_____________________ 
 
J. JONES, Justice 
 
 
Stuart Mackay sued Four Rivers Packing Co. alleging the breach of an oral contract for 
long-term employment and claiming that Four Rivers terminated him because it regarded him as 
disabled due to his insulin dependent diabetes.  Four Rivers moved for summary judgment in 
district court, which the court granted on both counts.  Mackay appeals to this Court.   We vacate 
the summary judgment order and remand. 
I. 
 
Four Rivers operates an onion packing plant near Weiser, Idaho.  Randy Smith, the 
general manager of Four Rivers, hired Stuart Mackay as a field man during the summer of 1999 
to secure onion contracts from growers in the area.  Four Rivers began experiencing financial 
difficulties in late 1999.  All employees, including Mackay, were laid off at this time because 
1 
one of the owners of Four Rivers filed suit to prevent the company from conducting business.  
When the lawsuit was resolved, Smith rehired Mackay as a field man.  According to Mackay, 
Four Rivers offered him a long-term employment contract in March of 2000 to continue working 
as a field man up to the time of his retirement.  Mackay claims he accepted the long-term offer of 
employment and advised Four Rivers that he may not retire for approximately ten years, at 
around age 62.   
 
Four Rivers denies extending such an offer to Mackay.  According to Four Rivers, the 
owners informed Randy Smith in 2000 that they did not know whether the company would be in 
business the next fall due to continuing financial difficulties.  In 2001, Mackay asked Four 
Rivers for a written contract of employment.  He refused to sign the agreement that was prepared 
because it gave Four Rivers the right to terminate his employment at will.  Subsequent efforts to 
arrive at a written employment agreement were unsuccessful.   
In 2000, Mackay was diagnosed with Type II diabetes and began taking oral medication 
to treat the condition.  Mackay claims he immediately notified Four Rivers of the diabetes.  In 
early 2003, Mackay became insulin dependent due to the diabetes.  He notified Four Rivers of 
this dependency and the possible side effects.  Four Rivers acknowledges that Mackay informed 
them of his condition, but denies it considered this a problem.  Four Rivers claims no one ever 
told Mackay that his health interfered with his job.   
 
On March 7, 2003, Smith terminated Mackay’s employment relationship without notice.  
According to Mackay, he did this because of Mackay’s diabetes.  A co-worker, Jim Goins, 
claims to have heard Smith say Mackay was “too heavy, that he could not get off his fat ass, and 
that he was too sick with diabetes to work for Four Rivers Packing.”  Smith denies making such 
a statement.  He claims Mackay’s performance was not satisfactory because he was not meeting 
with growers with the frequency or regularity necessary to obtain the quantity of onions 
necessary to keep Four Rivers’ packing plant operational on a full-time basis, resulting in the 
closure of the packing plant in February 2003.  Four Rivers claims its employees, including 
Mackay, were laid off at this time as a result of the early closure.  Mackay claims Four Rivers 
closed due to the price of onions at the time.  Mackay applied for unemployment benefits in 
2003, stating in his application that he was laid off due to company financial difficulties.  Smith 
states he offered to rehire Mackay in a different position later that year, and Mackay declined.   
2 
 
Mackay filed a complaint on August 24, 2004, claiming Four Rivers breached his 
employment contract and discriminated against him in violation of the Idaho Human Rights Act 
(IHRA).  Four Rivers answered, alleging that Mackay was an “at will” employee.  Further, it 
asserted an affirmative defense that a contract such as that claimed by Mackay is null, void, and 
unenforceable as violating Idaho Code § 9-505 because the agreement could not be performed 
within one year of its making.  Four Rivers moved for summary judgment in October 2006, and 
the district court granted its motion.  The court concluded the alleged contract could not be 
performed by its terms within one year and would therefore be invalid in the state of Idaho.  
Thus, it granted summary judgment with regard to Mackay’s breach of contract claim.  In 
addition, the district court granted summary judgment with regard to plaintiff’s disability claim, 
finding the plaintiff failed to direct the court to any authority recognizing diabetes as a disability 
under the IHRA.  Plaintiff subsequently filed a motion for reconsideration, which the district 
court denied, resulting in this appeal. 
II. 
 
We are presented with the questions of: (1) whether the district court erred when it held 
the alleged oral contract between Mackay and Four Rivers fell within Idaho’s Statute of Frauds; 
and (2) whether the district court erred when it held that Mackay must show his diabetes 
substantially limits a major life activity in order to make a disability discrimination claim under 
the IHRA. 
A. 
On appeal from the grant of a motion for summary judgment, this Court applies the same 
standard used by the district court originally ruling on the motion.  Carnell v. Barker Mgmt., Inc., 
137 Idaho 322, 326, 48 P.3d 651, 655 (2002).  Summary judgment is proper “if the pleadings, 
depositions, and admissions on file, together with the affidavits, if any, show that there is no 
genuine issue as to any material fact and that the moving party is entitled to judgment as a matter 
of law.”  Id. at 327, 48 P.3d at 656 (citing Idaho R. Civ. P. 56(c)).  All disputed facts are to be 
construed liberally in favor of the nonmoving party, and all reasonable inferences that can be 
drawn from the record are to be drawn in favor of the nonmoving party.  Id.  Summary judgment 
is appropriate where the nonmoving party bearing the burden of proof fails to make a showing 
sufficient to establish the existence of an element essential to that party’s case.  Id.  
3 
The burden at all times is upon the moving party to prove the absence of a genuine issue 
of material fact.  G & M Farms v. Funk Irrigation Co., 119 Idaho 514, 517, 808 P.2d 851, 854 
(1991). The plaintiff's case must be anchored in something more than speculation, and a mere 
scintilla of evidence is not enough to create a genuine issue. Id.  However, all doubts are to be 
resolved against the moving party, and the motion must be denied if the evidence is such that one 
may draw conflicting inferences therefrom, and if reasonable people might reach different 
conclusions.  Id.  
B. 
 
The parties disagree regarding the proper application of Idaho’s Statute of Frauds.  
According to Mackay, the longstanding rule in Idaho is that where an agreement depends upon a 
condition which may ripen within a year, even though it may not mature until much later, the 
agreement does not fall within the Statute.  Since the alleged contract here contains a term that it 
will last until Mackay retires, and Mackay could have retired within the first year, the oral 
contract does not violate the Statute.  Mackay argues this Court should construe the facts in his 
favor as the nonmoving party and determine that Four Rivers made a definite promise that he 
could work until retirement.  Thus, summary judgment was inappropriate on the contract claim.  
Alternatively, if the Court concludes the contract was unclear as to its intended duration, 
summary judgment was inappropriate because the contract term must be determined by a jury. 
 
Four Rivers denies entering into a long-term contract of employment, and further claims 
Mackay was at all times an “at will” employee.  Four Rivers claims Mackay’s allegations make 
it impossible to determine the term or duration of the alleged employment contract.  Thus, the 
alleged contract fails for indefiniteness.  Alternatively, Four Rivers claims the contract violates 
Idaho Code § 9-505, relying on Burton v. Atomic Workers Fed. Credit Union, 119 Idaho 17, 803 
P.2d 518 (1990).  The employee in Burton claimed the employer breached an employment 
contract entitling her to work until she retired at age 65.  According to Four Rivers, the contract 
in this case similarly falls within Idaho’s Statute of Frauds.  We consider that issue first.   
 
Idaho’s Statute of Frauds provision is found in Idaho Code § 9-505.  Section 9-505 
provides that “an agreement that by its terms is not to be performed within a year from the 
making thereof” is invalid, unless the same or some note or memorandum thereof, be in writing 
and subscribed by the party charged, or by his agent.  I.C. § 9-505.  Evidence of such agreement 
cannot be received without the writing or secondary evidence of its contents.  Id.  According to 
4 
the Restatement (Second) of Contracts, courts construe this statute narrowly.  Restatement 
(Second) 
of 
Contracts § 130, cmt. a (1981). 
Under 
the 
prevailing 
interpretation, 
the 
enforceability of a contract under the one-year provision does not turn on the actual course of 
subsequent events, nor on the expectations of the parties as to the probabilities.  Id.  Contracts of 
uncertain duration are simply excluded, and the provision covers only those contracts whose 
performance cannot possibly be completed within a year.  Id. 
Leading treatises follow this general rule.  It is well settled that the oral contracts 
invalidated by the Statute because they are not to be performed within a year include only those 
which cannot be performed within that period.  9 Samuel Williston, A Treatise on the Law of 
Contracts § 24:3 (West 1999).  A promise which is not likely to be performed within a year, and 
which in fact is not performed within a year, is not within the Statute, if at the time the contract is 
made there is a possibility in law and in fact that full performance such as the parties intended 
may be completed before the expiration of a year.  Id.  The question is not what the probable, or 
expected, or actual, performance of the contract was, but whether the contract, according to the 
reasonable interpretation of its terms, required that it could not be performed within the year.  Id. 
(quoting Warner v. Texas & P. Ry. Co., 164 U.S. 418, 17 S. Ct. 147 (1896)).  Further, a promise 
which is performable at or until the happening of any specified contingency which may or may 
not occur within a year is not within the Statute.  Id.  See also Caroline M. Brown, 4 Corbin on 
Contracts §§19.1, 19.2 (Joseph M. Perillo, ed. 1997). 
 
Idaho cases are in accord.  A contract which is capable of being performed and might 
have been fully performed and terminated within a year does not fall within the Statute.  
Darknell v. Coeur D’Alene & St. Joe Transp. Co., 18 Idaho 61, 69, 108 P. 536, 539 (1910) 
(contract was to be terminated on sale of plaintiff’s stock in the corporation, which sale might 
have taken place the following day or any day during the year).  Where the termination of a 
contract is dependent upon the happening of a contingency which may occur within a year, 
although it may not happen until the expiration of a year, the contract is not within the Statute, 
since it may be performed within a year.  Seder v. Grand Lodge, A.O.U.W. of North Dakota, 35 
Idaho 277, 280, 206 P. 1052, 1053 (1922).  See also  Gen. Auto Parts Co., Inc. v. Genuine Parts 
Co., 132 Idaho 849, 857, 979 P.2d 1207, 1215 (1999) (where the contract did not contain a 
definite term of duration, and was subject to several contingencies which could have occurred 
within one year, the Statute of Frauds did not bar enforcement of the contract). 
5 
 
In this case, the district court applied the Burton decision and found that the alleged oral 
contract could not, by its terms, be completed within a year.  In Burton, the plaintiff alleged there 
was an implied contract, which guaranteed her employment until she reached retirement, at age 
65.  119 Idaho at 18-19, 803 P.2d at 519-20.  Burton based this claim on evidence of oral 
representations, practices and procedures of the employer, and an employment manual prepared 
by the employer.  Id.  The employer argued the claimed oral contract for employment “until age 
65” violated the Statute of Frauds.  Id. at 20, 803 P.2d at 521.  This Court held that the alleged 
oral contract to employ Burton until age 65 could not by its terms have been performed within 
one year.  Id.  Thus, the trial court should have instructed the jury on the employer’s Statute of 
Frauds defense.  Id.  This case differs.  In this case, Mackay alleges the term of the contract is 
until retirement.  Unlike the contract in Burton, which specified “until age 65,” the alleged 
contract term in this case is indefinite.  Thus, the district court erred when it held Burton applied 
to preclude enforcement of the contract alleged in this case.   
 
Rather, this case falls under the general rule cited in numerous Idaho cases and in the 
Restatement (Second) of Contracts.  For the purposes of summary judgment, we must take as 
true Mackay’s allegation that the contract was to last “until retirement”.  Since Mackay could 
have retired within one year under the terms of the alleged contract, this contract is outside 
Idaho’s Statute of Frauds provision.  This case is similar to Whitlock v. Haney Seed Co., 110 
Idaho 347, 715 P.2d 1017 (Ct. App. 1986), cited by this Court with approval many times.  In 
Whitlock, an employee alleged an oral contract under which he was hired “so long as the plant 
run [sic].”  Id. at 348, 715 P.2d at 1018.  The employer testified the contract stated Whitlock was 
“to serve as manager of the [plant] so long as [he] owned Haney Seed Company and so long as 
[he] performed his duties . . . in an acceptable manner.”  Id.  The court first held that Whitlock 
was not an employee at will under either interpretation.  Id.  The court further held that, since 
any of these events could have been performed within one year, the contract was not within the 
Statute. Id. at 348-49, 715 P.2d at 1018-19.  Since the event at issue here – Mackay’s retirement 
– could possibly have occurred within one year, the Statute does not bar evidence of such 
contract. 
 
Four Rivers claims that, regardless of the Statute, Mackay’s contract claim fails because 
he was an at will employee, subject to being terminated at any time.  In Idaho, unless an 
employee is hired pursuant to a contract which specifies the duration of the employment, or 
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limits the reasons for which the employee may be discharged, the employment is at the will of 
either party, and either party may terminate the relationship at any time for any reason (or no 
reason) without incurring liability.  MacNeil v. Minidoka Mem’l Hosp., 108 Idaho 588, 589, 701 
P.2d 208, 209 (1985), overruled on other grounds by Metcalf v. Intermountain Gas Co., 116 
Idaho 622, 778 P.2d 744 (1989).  In this case, Mackay alleges the parties entered into a long-
term contract for employment, which makes the default “at-will” rule inapplicable to this case.  
As the parties dispute whether the contract of employment was at will or whether it contained a 
provision regarding duration, the issue is not subject to determination on summary judgment.   
 
Similarly, there is a disputed issue of fact as to whether the alleged contract contained a 
provision for its duration.  Even if we did not take Mackay’s contention as true, that the term of 
the contract is “until retirement,” summary judgment would still be inappropriate because there 
are disputed issues of material fact as to the duration of the alleged contract.  Mackay cites Rath 
v. Selection Research, Inc., 519 N.W.2d 503 (Neb. 1994), where the Supreme Court of Nebraska 
examined an oral employment contract.  The record in that case was unclear as to the duration of 
the contract – it was either “her lifetime,” her “career,” her “work lifetime,” “50 years,” or “until 
age 65.”  Since these positions yielded different results under the Statute of Frauds, the court 
found the record was not sufficiently clear for the district court to have determined the duration 
of the contract.  Thus, the record presented a material issue of fact as to the duration of the 
contract, which precluded summary judgment.  Id. at 506-07.   
The same is true in the case at bar.  In his affidavit, Randy Smith affies that Mackay 
understood he had no guarantee of long term employment.  After he came to work, Mackay 
asked for a written contract, but never signed that document because the parties could not agree 
to its terms.  Smith affies he never offered Mackay a long term contract.  Four Rivers submitted 
two additional affidavits from supervisors setting forth similar facts.  Mackay relies on his 
verified Complaint.  According to the Complaint, Mackay accepted Four Rivers’ offer of long-
term employment to continue as a field man for Four Rivers up to the time of this retirement.  At 
this time, he advised Four Rivers he may not retire for another ten years.   
The existence and terms of the contract here are not clear – these are all disputed facts.  
When the existence of a contract is in issue, and the evidence is conflicting or admits of more 
than one inference, it is for the jury to decide whether a contract in fact exists.  Johnson v. Allied 
Stores Corp., 106 Idaho 363, 368, 679 P.2d 640, 645 (1984).  Thus, because the parties dispute 
7 
whether there was a contract and, if so, what its duration was, there were factual issues that 
should have been presented to a jury for determination.  The district court erred when it granted 
summary judgment on Mackay’s breach of contract claim. 
C. 
Mackay claims Four Rivers took adverse employment action against him in violation of 
the Idaho Human Rights Act.  I.C. § 67-5901.  Mackay claims he presented specific evidence 
showing Four Rivers regarded him as having a disability that substantially limited his ability to 
perform his job, and terminated him based on that belief.  Mackay does not dispute that he was 
fully capable of performing the essential functions of his job, with or without accommodation, 
but asserts Four Rivers terminated him because it regarded him as disabled.  Mackay asserts it is 
irrelevant whether or not the plaintiff is actually disabled in a “regarded as disabled case,” and 
that the affidavit of his coworker, Goins, raises a triable issue that precludes summary judgment.  
Four Rivers claims summary judgment was proper because Mackay, by his own admission, did 
not have a physical condition that constituted a substantial limitation.  Further, no individual 
associated with Four Rivers ever considered Mackay to be disabled.  Finally, Smith denies ever 
making the alleged statement that Mackay was too sick with diabetes to do his job, and claims 
this allegation is conclusory and speculative.   
The purpose of the IHRA is to provide for execution within the state of the policies 
embodied in the federal Civil Rights Act of 1964, as amended, and Titles I and III of the 
Americans with Disabilities Act (ADA).  I.C. § 67-5901.  This Court has previously determined 
that the legislative intent reflected in I.C. § 67-5901 allows our state courts to look to federal law 
for guidance in the interpretation of the state provisions. O’Dell v. Basabe, 119 Idaho 796, 811, 
810 P.2d 1082, 1097 (1991); Bowles v. Keating, 100 Idaho 808, 812, 606 P.2d 458, 462 (1979). 
The ADA prohibits a covered entity from discriminating against a qualified individual 
with a disability in regard to the discharge of employees.  42 U.S.C. § 12112(a) (2006).  The 
ADA defines “disability” as: 
(A) 
A physical or mental impairment that substantially limits one or more of 
the major life activities of such individual; 
(B) 
a record of having such impairment; or 
(C) 
being regarded as having such an impairment. 
 
42 U.S.C. § 12102(2)(c) (2006).  Mackay bases his claim on subsection (C). 
8 
 
Regarded as having an impairment means the individual (1) has a physical or mental 
impairment that does not substantially limit major life activities but is treated by a covered entity 
as constituting such a limitation; (2) has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward such impairment; or (3) has 
[no such] impairments but is treated by a covered entity as having a substantially limiting 
impairment.  29 C.F.R. § 1630.2(l)(1)-(3)(2005).  The U.S. Supreme Court has held an employee 
may be “regarded as” disabled in two ways: (1) a covered entity mistakenly believes that a 
person has a physical impairment that substantially limits one or more major life activities; or (2) 
a covered entity mistakenly believes that an actual, nonlimiting impairment substantially limits 
one or more major life activities.  Walton v. U.S. Marshals Serv., 492 F.3d 998, 1005-06 (9th Cir. 
2007) (citing Sutton v. United Air Lines, Inc., 527 U.S. 471, 489, 119 S. Ct. 2139, 2149-50 
(1999)).  In order to state a “regarded as” claim, a plaintiff must establish that the employer 
believes the plaintiff has some impairment and provide evidence that the employer subjectively 
believes the plaintiff is substantially limited in a major life activity.  Id. at 1006.  If the plaintiff 
does not have direct evidence of the employer’s subjective belief that the plaintiff is substantially 
limited in a major life activity, the plaintiff must provide further evidence that the impairment 
imputed to the plaintiff is, objectively, a substantially limiting impairment.  Id.   
Mackay testified that he informed Four Rivers of his diabetic condition when he became 
insulin dependent.  Smith admits he had knowledge of the condition, but claims this was never a 
problem or consideration with regard to Mackay’s termination.  According to Smith, no one in 
the company viewed Mackay as disabled.  Mackay again relies on his verified Complaint and the 
affidavit of Jim Goins in opposition to summary judgment.  According to the Complaint, Mackay 
notified his supervisors when he became insulin dependent.  In his affidavit, Goins claims:  
I was not surprised by the termination of Mr. Mackay because I over heard Randy 
Smith state, on at least two occasions, that Mr. Mackay was too heavy, that he 
could not get off his fat ass, and that he was too sick with diabetes to work for 
Four Rivers Packing. 
 
Randy Smith denied making any statement to this effect.   
On reconsideration, the district court held that the affidavit of Jim Goins was “conclusory 
in nature and constitute[d] a mere scintilla of evidence which [did] not raise a genuine issue of 
9 
material fact.” 1  The district court adhered to its initial ruling that plaintiff could not prove his 
diabetes was a disability under IHRA.  Since Mackay could not establish a substantially limiting 
impairment, the court held he could not establish a claim under the IHRA. 
The district court erred in its holding.  The statement of Mr. Goins is direct evidence that 
Smith regarded Mackay as being substantially limited in the major life activity of working.2  
Four Rivers clearly disputes this contention and claims Mr. Goins’ affidavit is untrue.  There is a 
genuine issue of material fact as to whether Four Rivers regarded Mackay as substantially 
limited in the major life activity of working and terminated Mackay because of this perceived 
disability.  If Mackay’s contentions are true, Mackay may be able to prevail on his IHRA claim.  
Thus, the district court erred when it granted summary judgment to Four Rivers on Mackay’s 
disability discrimination claim. 
D. 
 
Both parties seek attorney fees pursuant to I.C. § 12-120(3), which allows recovery of 
attorney fees by the prevailing party in any commercial transaction.  The term “commercial 
transaction” is defined to mean all transactions except transactions for personal household 
purposes.  I.C. § 12-120(3).  Actions brought for breach of an employment contract are 
considered commercial transactions, subject to the attorney fee provision of I.C. § 12-120(3).  
Willie v. Bd. of Trustees, 138 Idaho 131, 136, 59 P.3d 302, 307 (2002).  Where an action is one 
to recover in a commercial transaction, that claim triggers the application of section 12-120(3) 
and the prevailing party may recover fees “regardless of the proof that the commercial 
transaction did in fact occur.”  General Auto Parts Co., Inc. v. Genuine Parts Co., 132 Idaho 
849, 860, 979 P.2d 1207, 1218 (1999). 
Mackay is the prevailing party on appeal but it remains to be seen whether he will be the 
prevailing party in the action, and, therefore, entitled to attorney fees under I.C. § 12-120(3).  
The district court, upon final resolution of the case, may consider fees incurred on appeal when it 
makes a determination as to the prevailing party. 
                                                 
1 Mackay initially filed the affidavit on August 26, 2005, prior to consideration of Four Rivers’ motion for summary 
judgment.  Mackay expressly relied on this affidavit in opposition to summary judgment.  Mackay filed his Motion 
for Reconsideration on the basis that the district court failed to consider the affidavit in its order granting summary 
judgment.  
2 EEOC regulations specify that a person is substantially limited in the major life activity of working if she is 
“significantly restricted in the ability to perform either a class of jobs or a broad range of jobs in various classes as 
compared to the average person having comparable training, skills and abilities.”  29 C.F.R. § 1630.2(j)(3)(i), quoted 
in Walton, 492 F.3d at 1009.   
10 
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III. 
 
We vacate the district court’s order granting summary judgment against Mackay on both 
counts, and remand the case for further proceedings consistent with this opinion.  Costs are 
awarded to Mackay but no fees. 
 
 
Chief Justice EISMANN, and Justices BURDICK, W. JONES, and HORTON 
CONCUR.