Fibreboard Products, Inc. v. Townsend

POPE, Circuit Judge

(concurring specially) .

I am in agreement with the conclusion reached in the foregoing opinion, and with most that is said therein. I think I should reserve judgment as to the first reason advanced by the opinion for the non-application of the Statute of Frauds.

The trial court, following the rule stated in Millsap v. National Funding Corp., 57 Cal.App.2d 772 , 135 P.2d 407 , has held that under the facts of this particular case, Fibreboard and Townsend entered into a contract of employment whereby the latter was entitled to employment for a reasonable period of time, and that under the circumstances, such employment must be taken to be for a period of two years. Thus the district court has held that on the facts of this particular case there was a contract of employment for a reasonable time, to-wit, two years.

I have difficulty in reasoning how this can be in fact a contract for employment for a period of two years and yet not come within the provisions of the California Statute of Frauds relating to contracts not to be performed within a year. I apprehend that in some states a contract for permanent employment, where supported by consideration, is construed to be an employment for life. In such cases the Statute of Frauds docs not prevent enforcement because by the very terms of the agreement it is to end upon the death of the employee, which may happen within the year. See Williston on Contracts § 495, note 8. In other slates a contract for permanent employment is held to be one merely for an indefinite period of time and terminable at the will of either party. But, as we are all agreed here, under the California rule such is not the import and effect of the particular agreement now before us.

*184 While I cannot discover that the California courts have ever dealt with this precise situation, I would anticipate in view of their decisions in other cases, that since the contract from Fibreboard to Townsend was in truth and in fact a contract for employment for two years, the impact of the Statute of Frauds upon it would be precisely the same as upon any other contract for employment for a fixed period in excess of one year.

It is true there is a minority view that in any contract for personal services, whether for a fixed period or not, death may end the contract and since death may come at any time, the contract is not within the Statute of Frauds. Such a case is Kelly-Springfield Tire Co. v. Bobo, 9 Cir., 4 F.2d 71 , which is cited and relied upon in the foregoing opinion. But that decision is contrary to Sessions v. Southern California Edison Company, 47 Cal.App.2d 611, 617 , 118 P.2d 935 , and Mr. Williston notes in footnote 11, § 495, that the Kelly-Springfield case is contrary to the great weight of authority. The later case of Hopper v. Lennen & Mitchell, 9 Cir., 146 F.2d 364 , is very different from the Kelly-Springfield case. It expressly recognizes the Sessions case as stating the California rule, and quotes language from Williston in accord with the doctrine of the Sessions case. The Sessions contract was one which called for payments for a period of six years. In that respect it was like the contract in our case which calls for payment for two years. This demonstrates that the contract before us is within the Statute of Frauds.

I do agree with the second reason given by Judge Harrison for his conclusion that the Statute of Frauds may not be relied upon as a defense here. Under the California rule stated in Monarco v. Lo Greco, 35 Cal.2d 621 , 220 P.2d 737 , defendant is clearly estopped from relying upon the Statute of Frauds to defeat the enforcement of the oral contract. The facts here found disclose that Townsend was induced by ¿Fibreboard seriously to change his position in reliance on the promises which made up the contract, and now to deny enforcement of the contract would result in unconscionable injury to the appellee. Under these circumstances, as disclosed by the decision in the Monarco case, supra, the California courts have consistently applied the doctrine of estoppel to assert the Statute of Frauds in order to prevent fraud that would result from refusal to enforce the oral contract. 1

Because the rule of the Monarco case is in itself a sufficient answer to the claim of defense under the Statute of Frauds, I prefer to confine my concurrence with respect to this issue to that ground alone.

I am authorized to state that Judge HEALY agrees with what I have here stated.

. For a discussion of this California rule and of the Monarco ease see 3 Stanford Law Review, page 281.