Court Opinion

ID: 9636231
Source: CourtListenerOpinion
Date Created: 2023-08-22 14:20:39.207719+00
Date Added: 2024-06-11T18:04:54.833716
License: Public Domain

STEPHENS, Justice,
dissenting.
I respectfully dissent. It is my belief that Rickert cannot recover compensatory damages based on the benefit of his alleged bargain with UPS under either a contract or promissory estoppel theory.
As the majority notes, Rickert did not establish the existence of an oral contract for employment between UPS and him. Rather, as Rickert stated in his testimony, UPS merely offered him a “chance” of employment if he chose to remain with his contract carrier, Orion Air, through the transition period; he could not prove that UPS intended to hire him. Further, he presented no evidence demonstrating that UPS, at its 1987 meeting with the Orion Air pilots, intended anything more than to offer Rickert and the other pilots a preferred opportunity to interview for a job with UPS. While it is undoubtedly true that UPS desired to retain the services of the contract carrier pilots pending institution of its own service, it is also abundantly clear that not all of the carrier pilots would be employed by UPS, only those who successfully completed the hiring process. Accordingly, Rickert was unable to persuade the jury that an oral contract existed for any term of employment and, as a result, UPS obtained a directed verdict regarding Rickert’s breach of contract claim.
*472Nonetheless, and somewhat incongruously, the jury awarded compensatory damages to Rickert based upon his claim for breach of an alleged 18-year oral employment contract. Even if UPS fraudulently induced Rickert to remain in Orion Air’s employ during the transition period, the damages awarded him were excessive. As the majority notes, Rickert asserted that had he been hired he would have remained a UPS employee until his retirement at the FAA-mandated age of 60. It is pure speculation to say that because Rickert has been a successful second officer at American Airlines that he also would have been a successful captain, which is a higher-ranking and perhaps more responsible position, at UPS. At the same time, Rickert admitted that UPS would have had the right to fire him at any time, for any reason, after commencement of his alleged employment agreement. Such indefinite “permanent” employment constitutes employment at-will in Kentucky. Cf. Shah v. American Synthetic Rubber Corp., Ky., 655 S.W.2d 489, 492 (1983) (stating that unless the parties clearly express their intention to alter the at-will relationship, “even though they speak in terms of ‘permanent’ employment — the parties have in mind merely the ordinary business contract for continuing employment, terminable at the will of either party”).
Thus, contrary to the majority’s- view, computing damages by awarding Rickert' the “benefit of his bargain” with UPS effectively permits Rickert, who would have at most been an at-will employee, to seek legal redress by converting oral promises into a guaranteed job for life. Moreover, an 18-year oral contract for employment would have been unenforceable under the Statute of Frauds:
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 notice thereof, be in writing and signed by the party to be charged therewith, or by his authorized agent.
KRS 371.010(7).
Since an oral 18-year employment contract would have been unenforceable and since Rickert admits that any employment relationship he might have had with UPS would have been at-will and its duration speculative, compensatory damages should not have been calculated based upon the contract’s theoretical existence. The purpose of Rickert’s action was not to recover for services already performed, but to recover damages which he claimed he had suffered in consequence of the breach of the oral contract. At most, he should have been awarded actual sums expended and compensation for time employed in preparing to begin work.
In an analogous case, Courier-Journal Co. v. Miller, Ky., 50 S.W. 46, 47 (1899), the Courier-Journal entered into an oral employment contract with Miller that would have continued as long as Miller’s services were satisfactory to the Courier Journal. Before Miller began work, however, the Courier-Journal notified him that his employment would be indefinitely postponed and that it would “be best not to let the thing now interfere with [his other job] arrangements.” Miller sued the Courier-Journal for damages. We held that the
[Courier-Journal] could discharge [Miller] at any time without cause, and there would, from the date of discharge, be no further liability. However, if there was [an oral] contract made, [Miller] would be entitled to recover the actual sums expended and compensation for the time necessarily employed in making preparation to begin the work. There is no element of damage save compensation for actual outlay of time or money up till notice that the contract would not begin....
Id. at 47 (emphasis added). For the same reasons, Rickert should not be allowed to base his damages on an at-will oral contract that would have, had it existed, violated the Statute of Frauds.
*473The result would be the same even if Rickert based his claim for compensatory damages purely on promissory estoppel, for an aspiring employee cannot sue for lost wages on an unfulfilled promise of at-will employment. Cf. Louisville & N.R. Co. v. Wells, 289 Ky. 700, 160 S.W.2d 16, 18 (1942) (holding that, absent a specific term, an unfulfilled promise of at-will employment is too vague to support an award of compensatory damages.) Because the UPS could have terminated Rickert without cause at any time after the employment began, the promise of a job brought no expectation of any determinable period of employment or corresponding amount of wages.
A review of the case law of our sister states is instructive in this matter. In Pepsi-Cola General Bottlers, Inc. v. Woods, 440 N.E.2d 696 (Ind.App.1982), the Indiana Court of Appeals recognized a right of action for promissory estoppel where Woods quit her former job in reliance upon an oral promise of employment with Pepsi. Before she could begin work, however, Pepsi informed her that she would not be hired. Woods sued for damages under the theory of promissory estop-pel.
Noting “the problem here to be the measure of recovery,” the court stated:
Under the promissory estoppel theory as stated in § 90 of the Restatement of Contracts, the promise which induces action [or forbearance] is binding if injustice can be avoided only by enforcing the promise. The promise which Woods seeks to enforce is an employment contract of indefinite tenure which is unenforceable for vagueness. The only thing, under law, that Pepsi promised was that Woods could work for Pepsi until either party decided to terminate their relationship.... [W]e have no way to determine the amount of wages to which Woods was entitled, since under the circumstances Pepsi could have discharged her after a single day’s work without incurring liability.
Id. at 699. The court thus held that a claim based on promissory estoppel entitled Woods only “to damages for expenses incurred in reliance on Pepsi’s promise,” and the court found “there was not sufficient proof of out-of-pocket expenses.” Id. See also Lorson v. Falcon Coach, Inc., 214 Kan. 670, 679-80 522 P.2d 449 (Kan.1988) (holding that plaintiffs detrimental reliance on oral promises of employment would sustain an action for damages for moving expenses and storage costs, but not lost wages.)
Rickert could not prove detrimental reliance on an oral promise of employment for a definite term. He should not be awarded damages based on the existence of an unenforceable 18-year oral employment contract, the term of which would be speculative at best.
COOPER, J., joins in this dissenting opinion.