McInerney v. Charter Golf, Inc.
680 N.E.2d 1347 (1997)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
An employee's promise to forgo a competing job offer constitutes sufficient consideration to form a lifetime employment contract, but under the Statute of Frauds, such a contract is an agreement not to be performed within one year and is therefore unenforceable unless it is in writing.
Facts:
- From 1988 through 1992, Dennis McInerney worked as a sales representative for Charter Golf, Inc.
- In 1989, McInerney received a job offer from a competing company, Hickey-Freeman, which offered an 8% commission.
- McInerney informed Jerry Montiel, Charter Golf's president, that he intended to accept the Hickey-Freeman offer.
- To induce McInerney to stay, Montiel orally promised him a 10% commission 'for the remainder of his life' and that he could only be discharged for dishonesty or disability.
- In exchange for this promise of lifetime employment, McInerney rejected the offer from Hickey-Freeman and continued to work for Charter Golf.
- In 1992, Charter Golf terminated McInerney's employment.
Procedural Posture:
- Dennis McInerney filed a complaint for breach of contract against Charter Golf, Inc. in the circuit court of Cook County (trial court).
- The trial court granted summary judgment in favor of Charter Golf, concluding the alleged oral contract was unenforceable under the Statute of Frauds.
- McInerney, as appellant, appealed the decision to the Illinois Appellate Court.
- The appellate court affirmed the trial court's judgment but on the different legal ground that forgoing another job offer was insufficient consideration to create a lifetime employment contract.
- The Illinois Supreme Court granted McInerney's petition for leave to appeal.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the Statute of Frauds require an oral contract for lifetime employment, supported by consideration in the form of a forgone job offer, to be in writing to be enforceable?
Opinions:
Majority - Justice Heiple
Yes, the Statute of Frauds requires that a contract for lifetime employment be in writing. Although an employee's promise to forgo another job opportunity is sufficient consideration to form a contract, that contract falls within the Statute of Frauds' one-year provision. The court reasoned that a 'lifetime' employment contract inherently anticipates a relationship of long duration, exceeding one year. To exempt such contracts from the writing requirement by reasoning that the employee could die within a year would 'eviscerate the policy' of the Statute, which is to prevent fraud and protect against stale evidence and fading memories. The court also held that neither partial performance nor promissory estoppel could be used to overcome the Statute's writing requirement in this case, as McInerney had been compensated for the work he performed and had not alleged any misrepresentation by his employer.
Dissenting - Justice Nickels
No, the Statute of Frauds should not require a lifetime employment contract to be in writing. The dissent argues that the majority departs from the plain language of the statute and the prevailing interpretation adopted by most courts and legal authorities. The correct interpretation is that if a contract is capable of being fully performed within one year—as a lifetime contract is upon the employee's death—it falls outside the Statute of Frauds. The dissent criticizes the majority for creating a new, policy-driven interpretation that ignores the statute's literal text ('not to be performed') and introduces uncertainty into an area of law that was previously clear. Under the well-settled majority rule, this contract is one of uncertain duration and is therefore enforceable even though it was not in writing.
Analysis:
This decision establishes Illinois as a minority jurisdiction regarding the application of the Statute of Frauds to lifetime employment contracts. By prioritizing the perceived policy of the statute over a literal interpretation of its text, the court makes it significantly more difficult to enforce oral promises of permanent employment. This ruling rejects the widely accepted view that such contracts are outside the statute because they can be completed within a year (by the employee's death). The decision reinforces a strict application of the Statute of Frauds in Illinois, signaling that courts will be hesitant to use doctrines like promissory estoppel to enforce oral agreements that the statute requires to be in writing.
Unlock the full brief for McInerney v. Charter Golf, Inc.