Payne v. K-D Manufacturing Co.

520 A.2d 569, 2 I.E.R. Cas. (BNA) 459, 1987 R.I. LEXIS 405
CourtSupreme Court of Rhode Island
DecidedFebruary 2, 1987
Docket84-358-Appeal
StatusPublished
Cited by9 cases

This text of 520 A.2d 569 (Payne v. K-D Manufacturing Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Rhode Island primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Payne v. K-D Manufacturing Co., 520 A.2d 569, 2 I.E.R. Cas. (BNA) 459, 1987 R.I. LEXIS 405 (R.I. 1987).

Opinion

OPINION

KELLEHER, Justice.

This is an employment-contract dispute that comes before us after a Superior Court jury awarded the plaintiff the sum of $95,000 in damages. The trial justice denied the defendant’s motions for a directed verdict and a new trial. The defendant has appealed both denials, and the plaintiff has filed “a conditional cross-appeal.” Hereafter we shall refer to the plaintiff as Payne, to the defendant as K-D, and to K-D’s vice president of manufacturing, P.J. Careara, as Careara.

The record indicates that sometime in late September 1978, K-D placed a help-wanted advertisement in the Providence Journal. K-D is situated in Lancaster, Pennsylvania. K-D manufactures tools, and at the time of the trial in February 1984 it had as part of its corporate makeup thirteen subsidiaries. One subsidiary was Central Tool Company, which was and still is located on Wellington Avenue in Cran-ston. K-D’s 1978 ad sought the services of an individual who would serve as the general manager of K-D’s Cranston operation. Payne was one of several applicants. His initial interview took place in mid-October 1978 at the Cranston Hilton hotel, where he first met Careara. A second meeting took place at Central Tool’s plant, where he once again met Careara and the then-present owner of Central Tool. At the conclusion of this meeting, Payne and Careara traveled to Warwick and Green Airport, where K-D’s private plane was waiting to transport them to K-D’s corporate headquarters. The next day Payne was the object of several interviews with K-D’s officials, including the director of employment relations. During this particular period, Payne and Careara discussed the contents of a document prepared by Careara entitled “Central Tool — Five Year Operational Plan.” The plan, which spanned the years 1979 through 1983, envisioned several changes including the automation of Central Tool’s production and accounting systems, a relocation of a portion of the subsidiary’s operations in Puerto Rico, and a restructuring of the operation. According to Payne, Careara made it clear that should Payne accept any offer made by K-D, he, Payne, would be responsible for the execution of the plan.

After Careara had a telephone conversation with the employee-relations director, he offered Payne the position of general manager at Central Tool with an annual salary of $35,000 per year, plus various benefits including use of a company car, participation in K-D’s pension plan, and six-month periodic reviews of his performance. Payne told Careara that he would consider the offer. The next day Payne consulted with his employment counselor, who suggested that Payne accept the offer. Payne telephoned his acceptance to Car-eara, who then informed Payne that he *571 would receive written confirmation of the agreement.

In due course, Payne received a letter dated November 10,1978, from the employee-relations director confirming K-D’s offer and Payne’s acceptance. The letter also set forth the salary, mentioned the periodic reviews, and asked Payne to sign an enclosed copy of the employee-relations director’s letter and return it to K-D’s headquarters. Of particular significance to the litigant was the director’s observation that everyone who had met Payne was “certain that we have made a good decision * * *. We are equally certain that you will find your relationship with K-D to be in your best interests over the coming years.”

Payne responded to the director’s letter with a November 13, 1978 written expression of appreciation and acceptance of the employment offer and of his expectation of a “long and prosperous affiliation with K-D Manufacturing Company.”

Payne reported for duty as general manager of the Cranston facility on November 16, 1978. Unfortunately, shortly after the beginning of the new year 1979, Careara came to Cranston and took Payne to lunch; on the way Payne’s expectation of a lengthy and beneficial relationship with K-D was shattered. As they traveled toward the restaurant, Careara informed Payne that there were to be “changes” and that one of the changes included a new general manager at Central Tool. Payne was also asked that once lunch was over, he not return to the plant.

The issue presented to the Superior Court jury for its determination was whether Payne, as he insisted, was the recipient of the five-year term of employment, or whether he was, as K-D argued, an employee-at-will who could be discharged at any time.

K-D’s motion for a directed verdict was based on Rhode Island’s version of the Statute of Frauds, specifically G.L.1956 (1969 Reenactment) § 9-l-4(5), which provides that no action shall be brought against any person upon any oral agreement that, by its terms, cannot be performed within a year of the making of the agreement. K-D, as it must, pleaded the statute as an affirmative defense. Payne countered by relying on the final portion of § 9-1-4, which permits enforcement of the promise in question if “the promise or agreement * * * or some note or memorandum thereof, shall be in writing, and signed by the party to be charged therewith, or some other person by him thereunto lawfully authorized.”

Many years ago in Cunha v. Gallery, 29 R.I. 230, 69 A. 1001 (1908), this court embraced the view that unsigned writings referred to in a signed writing may be read together with the signed writing to establish the terms of the agreement and satisfy our statute of frauds. Within the past decade, the court has also pointed out the necessity that the signed document recognize “at least implicitly, that the terms of the agreement are correctly stated in the unsigned writing.” Kates v. Kirshenbaum, 122 R.I. 486, 492, 409 A.2d 540, 544 (1979). (Citations omitted).

When K-D sought the directed verdict, the trial justice was confronted with conflicting testimony about what happened when Payne and Careara discussed Payne’s future with K-D. Payne had told the jury that after he had discussed the managerial plan with Careara, “no question” remained in his mind that he had come aboard for a five-year period during which he would attempt to achieve the goals laid out in the plan. Careara, on the other hand, insisted that the plan was merely a management tool that by no stretch of the imagination could be classified as a guarantee of five years of continued employment. The employee-relations director was part of the management group that met and conferred with Payne at K-D’s headquarters in the fall of 1978, and there is no question that when he forwarded the letter confirming Payne’s appointment, he did indeed express no doubt that Payne’s relationship with K-D would be in his “best interests over the coming years.”

*572 In moving for a directed verdict, K-D is in the same position as the employer in Powless v. Pawtucket Screw Co., 116 R.I. 158, 352 A.2d 643 (1976), who had, like K-D, relied upon the statutory bar of § 9-1-4(5). There we emphasized, as we have many times, that a trial justice, in considering such a motion, is required, as is this court, to view the evidence and the inferences of which the evidence is reasonably susceptible in the light most favorable to the plaintiff employee, drawing only those inferences that support the plaintiffs claim.

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Bluebook (online)
520 A.2d 569, 2 I.E.R. Cas. (BNA) 459, 1987 R.I. LEXIS 405, Counsel Stack Legal Research, https://law.counselstack.com/opinion/payne-v-k-d-manufacturing-co-ri-1987.