Lapham v. Whipple

Wilde, J.

This case turns on the construction of the contract on which the plaintiff’s claim is founded, which raises the question, whether it is not within the fifth clause of the first section of the statute of frauds, Rev. Sts. c. 74, which provides that no action shall be brought upon any agreement that is not to be performed within one year from the making thereof, unless the agreement, or some memorandum or note thereof, shall be in writing, and signed by the party to be charged therewith, or by some person thereunto by him lawfully authorized.

It is objected by the defendant’s counsel, that the parol evidence is inadmissible to prove the agreement alleged in the declaration, as it had a tendency to affect and control the written contract of sale therein referred to. But we think this objection is not well founded. We consider the contract of sale as an executed contract by the payment of the purchase money. And even if the verbal agreement were the consideration of the written contract, it was not required to be expressed *61 in writing, but may be proved, by virtue of the Rev. Sts. c. 74, § 2, by any other legal evidence. The parol agreement is a separate contract, and may undoubtedly be proved by oral testimony.

The only question to be considered is, therefore, whether the agreement of the parties is within the statute of frauds; and that question depends, as before remarked, on the construction of the agreement. It has been long settled that the said fifth clause of the first section of the statute has no reference to promises which may probably not be performed within a year, however strong the probability may be. It extends only to agreements, which by the express stipulations of the parties are not to be performed within a year: As an agreement or promise to pay a sum of money on the arrival of a ship; or on a party’s marriage; or to leave a sum of money by will; or to pay to a party an annuity; or any other promise depending on a contingency, which by any possibility may be performed within a year from the making thereof. In all such cases the statute does not require the agreement to be in writing. 2 Stephens Nisi Prius, 1976 — 1978. Roberts v. Rockbottom Co. 7 Met. 46 . In the present case, the defendant’s promise was to repay the plaintiff $ 1000, which he had paid the defendant for the pur chase of a share in a certain patent right, if the plaintiff did not, within three years from the date of the conveyance, realize the sum of $1000 out of the profits arising from the share of said patent right so conveyed to him.

The plaintiff’s counsel contends that this agreement might have been performed within a year, as the plaintiff might have realized the sum of $ 1000, within that time, from his share of the patent right, and that this would have been a performance, within the meaning of the contract. But we are of opinion that the true meaning of the contract is, that the plaintiff should have the whole term of three years, to ascertain what profits could be made from his share of the patent right; and that the performance of the contract was to be deferred until the expiration of that time. If then the plaintiff had realized, within the first year, $1000 profits, which had been reduced below that sum *62 during the two following years, the defendant would be liable for the non-performance of the contract. The realizing of the $ 1000 from the profits was the contingency on which the defendant might be discharged from his liability; but the payment of the money was to be the performance of the contract. And it is clear that the defendant would not be liable to an action for the non-performance, until the expiration of the three years. To support the action, the plaintiff must prove the contract; and the object of this clause of the statute was to prevent the proof of verbal agreements, when from the lapse of time the witnesses might not recollect the precise terms of the agreement. We think therefore that the defendant’s contract, by the terms of it, was not to be performed within a year from the time it was made, and is within the true meaning of the /statute.

Verdict set aside, and a new trial granted.