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United States District Court, Northern District of Illinois

April 29, 2003


The opinion of the court was delivered by: Zagel, Judge


This is a motion for summary judgment regarding an alleged employment agreement between plaintiff and third-party defendants ("PRM"), and Brent E. Wood, defendant and third-party plaintiff. Mr. Wood seeks to enforce the agreement in question, while PRM asserts that it is not an enforceable contract because it neither manifests an intent to be bound nor contains a definite and certain agreement capable of enforcement by the courts. See Wagner Excello Foods, Inc. v. Fearn International, Inc., 601 N.E.2d 956, 960 (Ill.App. 1992).

There is no question that for a certain period of time, Mr. Wood was engaged to perform services for PRM and that presently, Mr. Wood is not so engaged. PRM asserts that there was no employment contract with Mr. Wood and therefore, the employment was at-will. Mr. Wood, on the other hand, argues that the intent of the parties was to be bound by the agreement in question, which allowed for termination only with cause. PRM asserts that Mr. Wood's position is that the agreement between himself and PRM consists of a Memorandum from PRM dated August 23, 2001, containing a proposed agreement between PRM and Mr. Wood, and oral agreements reached between the parties to enhance or modify the terms of the Memorandum. Under Illinois law, however, which Mr. Wood appears to concede is the law governing this dispute, a contract whose terms are both oral and written is deemed an oral contract. Wielander v. Henich, 211 N.E.2d 775 (Ill.App. 1965). This alleged contract was for a duration of five years, not to be terminated in less than one year and thus, even if undisputably a complete and enforceable bilateral agreement, it would be unenforceable under the Illinois Statute of Frauds, as a contract not to be performed within one year. 740 ILCS 80/1. Mr. Wood does not explicitly state that this is his position, and I do not interpret his arguments in this way.

The proper inquiry, therefore, must focus on the Memorandum alone, and the question is whether this document is an enforceable contract. On its face, it does not appear to be so. The Memorandum has "draft" at the top of its first page, and the subject is "Proposed Executive Vice President PRM/ZAC Venture-Equity Capital Formation" (emphasis added). There are blanks in paragraph 8, which addresses the controlling state law and venue of any arising dispute, and there are no signatures on the document. PRM argues that based on these deficiencies, the document is clearly unenforceable.

While language such as "draft" and "proposed" suggest that it was not PRM's intention that the Memorandum represent a final agreement with Mr. Wood, Mr. Wood presents deposition testimony and emails indicating that the Memorandum, despite its appearances, was considered the final agreement between the parties. For example, Robert Harte's deposition testimony indicates that the Memorandum contained Mr. Wood's employment terms and "business plan" of what Mr. Wood would do for PRM, and an email from Demerette Kee, PRM's office manager, refers to the Memorandum as "the final employment agreement." Also, the blanks contained within the Memorandum only concern controlling state law and venue-otherwise, the Memorandum contains essential terms that are definite and certain. PRM argues that Mr. Wood has only presented a factual dispute relating to the parties' subjective intent and that because whether a contract is enforceable is an issue of law, this factual dispute does not defeat summary judgment. However, Mr. Wood does not appear to argue that there is a dispute between the parties' subjective intent but rather, that the parties' subjective intent was the same at the time the alleged agreement was executed and the dispute is between PRM's intent at that time and what PRM alleges now. In other words, PRM has changed its story. I find that there is a material issue of genuine fact as to whether PRM saw and treated the Memorandum as a final agreement, and PRM's statement that no such intent ever existed is not sufficient by itself to defeat Mr. Wood's argument that there had been a meeting of the minds at the time the alleged contract was formed. PRM argues that throughout its relationship with Mr. Wood, it was continuing to develop and modify the terms in the Memorandum, as evidenced in the lack of a document representing a finalized agreement. However, if I accept Mr. Wood's version of the facts, as I must for the purpose of this motion, the reason a more formal written contract was never created was that the parties both operated with the understanding that the Memorandum sufficiently represented the terms of Mr. Wood's employment and the parties' intent and thus, the parties did not feel a need to draw up another document.

Because Mr. Wood has presented a factual dispute with respect to PRM's treatment and understanding of the Memorandum, I deny PRM's motion for summary judgment.


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