Court Opinion

ID: 9768890
Source: CourtListenerOpinion
Date Created: 2023-08-29 13:54:40.053841+00
Date Added: 2024-06-11T07:30:48.623556
License: Public Domain

Mr. Justice Griffin
dissenting.
I respectfully dissent from the majority opinion for the reasons herein stated.
When I consider the case of Chevalier v. Lane’s (1948), 147 Texas 106, 213 S.W. 2d 530, 6 A.L.R. 2d 1045, I cannot get the result reached by the majority. In my opinion, the majority is in error in their construction of the test to be used. As I understand the Chevalier case, it means that an oral contract, or an “agreement,” is within the Statute of Frauds if its performance in less than a year depends upon the operation of law, or other fortuitous circumstances not provided for* in the agreement between the parties. If the parties agree that the contract shall be performed within a year upon the death of one. of the parties, or other circumstance set out in the contract, then the Chevalier case holds such agreement is not within .the Statute, and the agreement may be enforced although it is oral.
Let us examine the agreement entered into between Kouchoucos and Gilliam upon which this suit is based. It is undisputed that the term for which Kouchoucos was emplayed as manager of the Beaumont Petroleum Club was the same term as that contained in a written contract between Kouchoucos and Ridge-wood Motor Hotel, Inc. It is also undisputed that Gilliam was the builder, principal stockholder and president of the Motor Hotel Corporation. That contract was in writing, and it was introduced in evidence. The term of employment set out in its material parts in that contract is:
“The term of this contract and agreement shall be for a period of ten years from the date of completion of the premises * * * .
*305“No sale or change in ownership of the premises shall affect this contract and agreement; such sale or change of ownership shall be subject to this contract and agreement. This contract and agreement shall, however, terminate on the death of the Operator, and any further operation by his heirs, assigns or successors shall be under a re-negotiated contract.”
In my opinion, this clearly shows that the parties intended that the contract would be “performed,” “come to an end,” or “terminate” upon the death of Mike Kouchoucos. This is the crucial provision which take our contract out of the Statute of Frauds.
After stating that the term of the contract should be for a period of ten years, it provides that “this contract and agreement shall, however, terminate on the death of the Operator, and any further operation by his heirs, assigns or successors shall be under a re-negotiated contract.” The first promise of the contract is that it shall be for a term of ten years, but, in the alternative, the contract is at an end and fully performed “on the death of the Operator.” To emphasize that the obligations under the contract shall be considered performed upon the death of the operator, the agreement specifically provides “any further operation by his [the operator’s] heirs, assigns or successors shall be under a re-negotiated contract.” This language shows the contract to be at an end and the operator has discharged all his obligations thereunder, and full and complete performance of the contract would be had upon the death of Kouchoucos. The very contingency which the parties agreed in their contract should fulfill it might have happened within one year; therefore, the contract is not within the terms of the Statute of Frauds.
In the Chevalier case, this court was careful to point out early in the opinion that the “employment period was fixed in calendar terms, * * * and contained no reference to possible death of plaintiff, or other contingency that might prematurely terminate the'arrangement.” In discussing the case of Weatherford, Mineral Wells & Northwestern Railway Company v. Wood, 88 Texas 191, 30 S.W. 859, 28 L.R.A. 526, in the Chevalier case, this court, among other things, said:
“* * * This Court held that since the arrangement was personal to plaintiff Wood or to him and his family, and would necessarily terminate on their death, which could have occurred within a year from the making of the agreement, the latter *306was not one ‘not to be performed within the space of one year * * regardless of whether the parties ever had the possibility of death in mind. * *
And further, in the Chevalier case, this court said:
“* * * For example, an agreement to sell the output of a factory for two years may well be avoided on destruction of the factory within six months, but is it ‘performed’ ? On the other hand, if A agrees to work for B for the term of A’s life or until the happening of some other fortuitous event, and does so work until the event occurs, A may accurately be said to have ‘performed.’ Upon the basis of this distinction, it has been held in many jurisdictions that, while an agreement such as that last mentioned is not subject to the Statute, an agreement to work for a definite period of more than one year from the contract date, as in the instant case, is within the Statute. * * **.”
The Court then proceeds to declare the rule governing the determination of whether or not oral contract of employment comes within the Statute of Frauds, and says:
“* * ** We accordingly restate the rule so that where, by the terms of the oral agreement, its period is to extend beyond a year from the date of its making, the mere possibility of its termination by operation of law within the year, because of death or other fortuitous event, does not render paragraph 5 of the Statute inapplicable, but that, on the other hand, where the agreement may, by its own terms, be fully performed within the year, as, for example, the agreement in Wright v. Donaubauer, 137 Texas 473, 154 S.W. 2d 637, for employment during the term of a man’s life, the Statute does not apply. By the foregoing we necessarily approve the above-mentioned line of authority represented by Paschall v. Anderson, [127 Texas 251, 91 S.W. 2d 1050] and overrule the line represented by Weatherford, Mineral Wells & Northwestern Railway Company v. Wood, [88 Texas 191, 30 S.W. 859, 28 L.R.A. 526], and Great Atlantic & Pacific Tea Co. v. Warren, [Texas Civ. App., 44 S.W. 2d 510]. We also take occasion here to reaffirm our holding in Wright v. Donabauer, supra, though it was not immediately involved in the conflicts above discussed.”
In Wright v. Donaubauer, 137 Texas 473, 154 S.W. 2d 637, expressly reaffirmed by this court in the Chevalier case, we find the following:
*307“By the terms of the contract, same would be terminated by the death of Leonards, which might have occurred at any time after the making of the contract. This contingency might have happened in less than a year after making1 of the contract, and on its happening would have terminated the contract. To condemn a contract as violating the Statute of Frauds, it must appear from the agreement itself that it is not to be performed within a year after its execution. This contract carries no such provision. Therefore such contract, under the decisions of this court did not violate Section 5 of Article 3995, R.C.S., 1925 * * *,” citing authorities.
Here again, whether or not the contract is within the statute depends upon the agreement of the parties. There can be no doubt that where the agreement is silent as to a means or method of performing the contract within one year, the contract is within the statute. Such cases are Moody v. Jones, Texas Civ. App., 37 S.W. 379; Paschall v. Anderson, 127 Texas 251, 91 S.W. 2d 1050; San Antonio Light Publishing Co. v. Moore, Texas Civ. App., 101 S.W. 867; Jackman v. Anheuser-Busch, Inc., Texas Civ. App., 162 S.W. 2d 744, wr. ref.
I recognize that a mere defeasance or cancellation provision which may occur within the period of one year does not take the agreement out of the Statute of Frauds. Willis-ton On Contracts, 3rd Ed.„ Vol. 3, p. 594, section 498A. However, the same author says at p. 591, id., “the distinction between completion of performance and an excuse for non-performance, previously adverted to is made in contracts where the promise is in the alternative and in agreements subject to a right of cancellation or defeasance. The courts recognize a distinct difference between a contingency which fulfills the terms of the contract and a defeasance which prevents fulfillment. Where the promise is in the alternative, the contract is not within the statute if either alternative can be performed within a year from the date when the contract is made even though the other cannot be so performed.”
The leading case in the United States discussing the Statute of Frauds is Warner v. Texas & Pacific R. Co., 164 U.S. 418, 41 L. Ed. 495, 17 S. Ct. 147, which states “the Statute of Frauds plainly means an agreement not to be performed within the space of a year, and expressly and specifically so agreed. A contingency is not within it; nor any case that depends upon a contingency.” (Court’s emphasis.)
*308The case of Deevy v. Porter, et al, 11 N.J. 594, 95 A. 2d 596, construed a contract of employment containing the provision that the employees “could quit at any time.” The court says (citing Wagniere v. Dunnell, 29 R.I. 580, 73 A. 309, 310) “it is established by the great weight of authority that a contract for a definite term longer than a year is not excluded from the operation of the statute of frauds because it contains a provision enabling either party to put an end to the contract within a year; the reasoning of the courts being that the rescission of a contract is not the performance of it.”
The holding of the Court that the contract was an “option” contract which might be terminated upon the option of the employees, exercised within one year is not authority for holding our contract within the Statute of Frauds. Our contract is not an “option” contract, rather it is a contract, the performance of which depends on the happening of a contingency which may occur within a year, and is not within the statute. “* * * The contingency, it has been held, must be one that is beyond the control of both, parties, and is not entirely within the control of one of the parties, * * * .” 37 C.J.S. 560, section 51. The case of Barnes v. P. & D. Manufacturing Co., 123 N.J.L. 246, 249, 8 A. 2d 388, is also not in point in our case. The very quotation set out in the majority opinion shows the contract there involved was an “option” contract, and not a contract of alternative performance, and not based upon a contingency not under the control of either party to the contract.
In Williston, On Contracts, 3rd. Ed., Jaeger, pp. 581-582, we find the rule stated thus: “Nor is a promise obnoxious to the statute which is performable at or until the happening of any specified contingency which may or may not occur within a year. ‘It has been repeatedly held that, if an agreement whose performance would otherwise extend beyond a year may be completely performed within a year on the happening of some contingency, it is not within the statute of frauds,’ ” (citing from Carnig v. Carr, 167 Mass. 544, 46 N.E. 117, 35 L.R.A. 512). And further, on page 598, section 498B, the same text states, (quoting from Fenton v. Emblers, 3 Burrow 1278), “The statute of frauds plainly means an agreement not to be performed within the space of a year, and expressly and specifically so agreed. A contingency is not within it; nor any case that depends on a contingency.”
Williston, on pages 601-604, id., discusses the cases which have failed to distinguish between contracts providing for an *309alternative performance, and those subject to an express defeasance or cancellation. The text approves the dissent in the case of Coan v. Orsinger, 265 F. 2d 575. The contract in that case was to employ a first year law student as resident manager until the student completed his studies as a student duly matriculated in Georgetown University Law Center, Washington, D. C., or was obliged to discontinue these studies. The court held the contract within the Statute of Frauds. Williston, in criticizing this opinion, says: “ * * * In so holding, the majority, of course, failed to distinguish between a discharge from liability because of a refusal to perform the first clause, and the possibly complete and timely performance of the second provision. Actually, the promise made by the defendant employer was to employ plaintiff [the student] as resident manager during a period of time which would not exceed the time it might take to complete the curriculum at the Law Center, or a much shorter one, if, for one reason or another, plaintiff ‘was obliged to discontinue’ his studies. Thus, if the contemplated contingency occurred within the year, it would result in the completion of plaintiff’s duties as resident manager within the year, and the requirements of the statute would be satisfied.”
This reasoning fits our case exactly. Here the plaintiff was employed for a period not to exceed ten years, or a much shorter period if plaintiff should die sooner than ten years. Since the contemplated contingency — death of the plaintiff — might have occurred within the year, it would result in the completion of our plaintiff’s employment within the year, and the requirements of the statute would be satisfied.
To the same effect is Corbin On Contracts, Vol. 2, p. 541, et seq., section 445, in which he cites many, many cases. Also the same authority on p. 556, section 447, says, “* * * but in service cases it is generally recognized that termination of duty by operation of law is not identical with performance of a promise. The death of a party may terminate duty, but the contemplated work has not been done. It is otherwise if the parties have themselves agreed upon the limitation as one of the terms of the agreement that created the duty.” .
This is the error of the majority opinion herein. It applies the rule whereby the contract of the parties is terminated by operation of law to a case where the parties themselves have agreed that the death of the plaintiff is performance. I say that the Chevalier case upholds this very distinction which the majority has overlooked. The majority nowhere cites any case or *310any authority in which the parties themselves included in their contract of employment a condition of alternative performance of the contract, or a contingency over which either party had control which would fully perform the contract.
Based upon this interpretation of the Chevalier case, and my understanding of its application to our cause here, and upon study and discussion of other cases and authorities pertinent thereto, it is my opinion that the majority’s holding is directly contrary to the law thus declared, and I would, therefore, affirm the Court of Civil Appeals.
Opinion delivered November 9 ,1960.
Rehearing overruled December 7,1960.

■ — All emphasis mine unless otherwise indicated.