P was a construction contractor. D was a real estate developer.
D became the developer of a major project and met with P about contracting services. D orally agreed to hire P as the construction manager for the project, which was supposed to take about 10 years to complete. There was no written contract.
P worked on the project for a few months. D became dissatisfied with P's work and replaced P as construction manager.
P sued D for breach of contract.
Procedural History:
District Court granted summary judgment for D, contract under statute of frauds, contract not enforceable.
2nd Cir COA sent certified questions to CT Supreme Court since there was no precedent under CT law.
CT Supreme Court found for P, contract not under statute of frauds, contract enforceable.
Issues:
Does the statute of frauds one year rule render unenforceable an oral contract that fails to specify explicitly the time for performance when performance of that contract within one year is very unlikely?
Holding/Rule:
An oral contract that does not say, in express terms, that performance is to have a specific duration beyond one year is equivalent to a contract of indefinite duration, does not fall under the statute of frauds, and should be enforceable, regardless of how long completion of performance will actually take.
Reasoning:
The one-year provision in the statute of frauds no longer seems to serve any purpose very well, and today its only remaining effect is arbitrarily to forestall the adjudication of possibly meritorious claims.
A contract is not within the one year clause (thus requiring a written contract) unless its terms are so drawn that it cannot by any possibility be performed fully within one year.
Contracts of uncertain duration are excluded from the clause. The clause covers only those contracts whose performance cannot possibly be completed within a year.
From Burkle, "It is the law of this state that a contract is not within the clause of the statute unless its terms are so drawn that it cannot by any possibility be performed fully within one year."
Most other jurisdictions follow a similar rule requiring an express contractual provision specifying that performance will extend for more than one year.
The one year provision is an anachronism and a destructive force!
When a contract contains no express terms about the time for performance, no sound reason of policy requires the judiciary to make an inquiry into whether, at the time of the making of the contract, it was realistically possible that performance of the contract would be completed within a year.
Dissent:
None.
Notes:
Prof says the court was looking for a way to get around the one year clause in the statute of frauds.
This is not necessarily the majority rule, but it looks like the law is going here.
