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Mapes v. Kalva Corp.

OPINION FILED FEBRUARY 8, 1979.

JOHN R. MAPES, PLAINTIFF-APPELLEE,

v.

THE KALVA CORPORATION, DEFENDANT-APPELLANT.



APPEAL from the Circuit Court of Lake County; the Hon. FRED H. GEIGER, Judge, presiding.

MR. PRESIDING JUSTICE GUILD DELIVERED THE OPINION OF THE COURT:

Plaintiff, John R. Mapes, sued defendant Kalva Corporation, alleging breach of an employment contract. The trial court entered judgment on a jury verdict, awarding plaintiff $19,975. Defendant appeals, contending that the trial court made several rulings which improperly excluded the Statute of Frauds from consideration in the case. We agree and, therefore, reverse that part of the judgment that would have been subject to the statute.

Plaintiff filed his original complaint on December 22, 1974, alleging that he and the defendant had entered into an oral agreement on December 28, 1973, concerning plaintiff's employment by defendant through December 31, 1974, and alleging the company had wrongfully discharged him on January 15, 1974. The defendant moved to dismiss the cause on the grounds that enforcement of the alleged oral agreement was barred by the Statute of Frauds (Ill. Rev. Stat. 1973, ch. 59, par. 1). The trial court allowed plaintiff to file a verified amended complaint, which he did on March 31, 1975. The amended complaint alleged in part:

"2. That it was understood and agreed by and between the parties that in addition to a stipulated salary the Plaintiff was to receive as additional compensation a sum equal to five per cent (5%) of the Defendant's profits before taxes and profit sharing; said sum to be paid after the close of the Defendant's fiscal year on October 31, 1973"

and

"3. That during the month of January, 1974 the parties hereto agreed that the Plaintiff's employment would be continued retroactively from November 1, 1973 to October 31, 1974 at an annual salary of $27,500.00, payable monthly; * * *."

There was no express reference in the complaint to any other specific agreement between the parties. This amended complaint is not vulnerable on its face to a motion to dismiss based on the Statute of Frauds. Defendant filed an answer denying the allegations set forth above.

At trial plaintiff testified that he had met with Mr. Edmund Opler, president of defendant Kalva's parent company, during October, 1972, and that at that time Opler offered plaintiff a new position at a salary and bonus which the two men agreed upon. According to plaintiff, their agreement provided that his salary for fiscal 1973 (November 1, 1972, to October 31, 1973) was to be $25,000. Plaintiff also testified that he and Opler agreed that if the company were to realize a profit of at least $50,000 for fiscal 1973 plaintiff was to receive 5% of profit achieved and a salary increase of $2500 for fiscal 1974 (November 1, 1973, to October 31, 1974). If the company were to achieve a profit of at least $100,000 for fiscal 1974 plaintiff was to receive 5% of such profit achieved and a salary increase of $5000 for fiscal 1975.

Plaintiff assumed his new duties on November 1, 1972, and was paid the agreed $25,000 salary during fiscal 1973. Defendant realized a profit of $133,000 for that year but plaintiff received a bonus of only $2500. Beginning November 1, 1973, plaintiff's paychecks began to reflect an increase of salary to $27,500 per year. In late December 1973 plaintiff was told his salary was being reduced to $12,000 a year as of January 1, 1974. Plaintiff worked at the $12,000 salary until he was fired on March 29, 1974. He was unable to secure other employment until August 1974.

Plaintiff was specifically asked at the trial about any agreements with defendant entered into after November 1972. He answered that he had telephoned Opler in January 1974 to complain of the breach of the alleged 1972 agreement. According to plaintiff, "I said that our agreement was thus and so and he said yes, it was, but that is now changed." This phone conversation is apparently the basis for the paragraph in plaintiff's amended complaint alleging a contract arrived at in January 1974.

The only writings in support of the alleged employment contract introduced by plaintiff were some of his paycheck stubs, and at oral argument plaintiff's attorney admitted that he could not prove the existence of any written contract.

At the close of plaintiff's case in chief, defendant moved to dismiss the case on the basis of the Statute of Frauds. This motion was denied by the trial court. Defendant also moved to amend his answer to include the Statute of Frauds defense. This motion was also denied. The trial court stated that it denied plaintiff's motions because both partial performance by plaintiff and the existence of the check stubs as a writing made the Statute of Frauds inapplicable to the instant case. Defendant then put on its own case, during which Opler admitted meeting with plaintiff during October 1972 to offer him a new position, but denied discussing any detailed contractual arrangements such as the one described by plaintiff. Opler also denied communicating with plaintiff in January 1974 about the latter's salary. At the close of the trial the trial court again denied defendant's motions with regard to the Statute of Frauds and refused to give defendant's proposed instructions on that statute to the jury. No instruction on the Statute of Frauds was given to the jury. The parties stipulated that if defendant were liable, damages would be $19,975. The jury awarded that amount to the plaintiff. Defendant renewed his motions after the conclusion of the trial and they were again denied.

There are two issues before us. (1) did defendant waive his right to the defense of the Statute of Frauds by not pleading it before the trial, and (2) if it were not waived, does the Statute of Frauds ...


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