Opinion
No. 05-05-00235-CV
Opinion Filed December 15, 2005.
On Appeal from the 401st Judicial District Court, Collin County, Texas, Trial Court Cause No. 401-1373-04.
Affirm.
Before Justices MOSELEY, O'NEILL, and BRIDGES.
MEMORANDUM OPINION
In this breach of an employment contract case, appellant Sheila Timmons appeals a summary judgment granted in favor of Scarbrough, Medlin Associates (SMA). In six issues, Timmons generally complains the trial court erred in concluding the statute of frauds barred her claims. For the following reasons, we affirm the trial court's judgment.
SMA is an insurance agency that sells insurance policies to various entities. In July 2003, Timmons was approached by a business associate, William McGinnis, about an idea he had about starting a new division of SMA specializing in writing insurance for utility companies. At that time, McGinnis was not employed by SMA, but his wife was.
Timmons discussed her employment requirements with McGinnis and gave him an "Employment Proposal." In addition to requesting an $83,500 salary, the proposal stated Timmons would "Require a five (5) year employment contract that will pay a minimum of 18 months severance pay in the event service is no longer required."
McGinnis subsequently presented a proposal to SMA regarding his overall plan for the utility unit. He included in the general proposal Timmons's employment proposal. McGinnis subsequently informed Timmons that he had given the employment proposal to SMA and that "everything was okay." SMA decided to proceed with the utility unit and offered employment to Timmons. SMA did not make any direct representations to Timmons regarding a five year contract or severance pay.
Timmons subsequently began work at SMA. When she began work, SMA had promised to prepare and execute a written contract for employment. The terms of any such contract were not specifically discussed. About two months after she began work at SMA and before any written contract was executed, SMA terminated Timmons. Timmons filed suit for breach of contract seeking eighteen months severance pay.
SMA filed a motion for summary judgment asserting Timmons's claim is barred by the statute of frauds because she is suing on an employment contract for more than one year. Timmons replies that she is not suing on an employment contract for more than one year, but rather an agreement to pay her severance in the event she was terminated.
An agreement that is not to be performed within one year of its making is not enforceable unless the agreement is in writing and signed by the person to be charged. See Tex. Bus. Com. Code Ann. § 26.01(b)(6) (Vernon 2002). Thus, an oral agreement for employment for more than one year is within the statute of frauds. C.S.C.S. v. Carter, 129 S.W.3d 584, 590 (Tex.App.-Dallas 2003, no pet.). However, if an employment contract can be "performed" within one year it is not within the statute of frauds. See Gerstacker v. Blum Consulting Eng., Inc. 884 S.W.2d 845, 849 (Tex.App.-Dallas 1994, pet. denied).
After reviewing the pleadings and the summary judgment record, we conclude SMA established as a matter of law that the statute of frauds bars Timmons's claim. Timmons's proposal which she is seeking to enforce expressly states she will "[r]equire a five (5) year employment contract that will pay a minimum of 18 months severance pay in the event service is no longer required." Timmons is seeking damages because SMA terminated her less than five years after she began work. Thus, Timmons is necessarily seeking to enforce a promise of employment for more than one year. The fact that the parties agreed that damages would be set at eighteen months of salary does not alter our conclusion. Thus, the contract is within the statute of frauds.
Appellant next asserts that her partial performance under the contract takes the contract out of the statute of frauds. Partial performance is an exception to the statute of frauds. Exxon Corp. v. Breezevale Ltd., 82 S.W.3d 429, 439 (Tex.App.-Dallas 2002, pet. denied). The partial performance must be "unequivocally referable" to the agreement. Id. That is, the acts must be such as could have been done with no other design than to fulfill the particular agreement sought to be enforced. Id. at 439-40. Here, the partial performance Timmons relies on to take the contract out of the statute of frauds is her rendition of services to SMA. It is not disputed that Timmons was compensated for her work at SMA. Rendition of services for which a person receives a monthly salary is insufficient to take an agreement outside of the statute of frauds because the rendition of services is fully explained by the salary. Wiley v. Bertelsen, 770 S.W.2d 878, 882 (Tex.App.-Texarkana 1989, no pet.). Thus, the doctrine of partial performance does not operate as an exception to the statue of frauds in this case. We affirm the trial court's judgment.