Can a signed writing be read together with an unsigned writing, with parol evidence used to connect them, to form a memorandum satisfying the statute of frauds for a two-year employment contract?

In September 1947, Nate Crabtree negotiated with Elizabeth Arden Sales Corporation for employment as sales manager. He sought a three-year contract at $25,000 per year, explaining that he would give up a secure job to enter a new field that would take years to master, and therefore insisted on a definite term. Miss Arden, the corporation's president, offered a two-year contract at $20,000 for the first six months, $25,000 for the next six months, and $30,000 for the second year, plus $5,000 annual expenses. Crabtree replied that the offer was "interesting." Miss Arden had her personal secretary write a memorandum on a telephone order blank, noting the salary scale, the expense money, and the phrase "2 years to make good." The memorandum was unsigned. Crabtree then accepted by telephone and telegram, and Miss Arden wired her welcome. When he began work, a payroll change card initialed by executive vice-president Johns recorded the parties, job classification, and the salary schedule, including $30,000 after one year. Crabtree received the increase to $25,000 after six months but not the increase to $30,000. The comptroller prepared and signed another payroll card noting a salary increase to $30,000 "per contractual arrangements with Miss Arden." Miss Arden refused to approve the increase, and Crabtree left and sued for breach of contract.

Crabtree sued Elizabeth Arden Sales Corporation for breach of contract. At trial, the corporation denied that any two-year agreement existed and asserted the statute of frauds. The trial court rejected both defenses and awarded Crabtree damages of about $14,000. The Appellate Division affirmed, with two justices dissenting. The corporation appealed to the New York Court of Appeals.

(Fuld, J.)

Yes. The signed payroll cards and the unsigned office memorandum may be read together as a single memorandum satisfying the statute of frauds, and parol evidence may be used to connect them.

The payroll card initialed by Johns and the card signed by Carstens are memoranda under Personal Property Law § 31, even though they were not prepared to evidence the contract and were created after its formation. It suffices that they were signed with intent to authenticate their contents and that those contents evidence the contract's terms. Marks v. Cowdin, 226 N.Y. 138 (1919).

The signed cards contain every essential term except the duration of employment. The statute permits a memorandum to be pieced together from several writings. Where some writings are unsigned, the court adopts the rule that signed and unsigned writings may be read together if they clearly refer to the same subject matter or transaction. The statute does not require that the signed acknowledgment appear from the writings alone. Parol evidence may show the connection between the papers and the signing party's assent to the unsigned one. The risk of fraud is minimal because all terms must appear in the writings, at least one writing must bear the defendant's signature, and the judge may find as a matter of law that the connection or assent is unproven.

Here, all three writings identically state the parties, position, and salary, and Carstens' card refers to "contractual arrangements with Miss Arden." The office memorandum was prepared by Miss Arden's own secretary, and the parties' conduct shows assent to it.

The notation "2 years to make good" fixes a two-year term; otherwise the employment would be at will and the notation would be meaningless. The scale of increasing wages is inconsistent with at-will employment. To the extent the phrase is ambiguous, parol evidence is admissible to explain it, and Crabtree's insistence on job security supports a definite two-year term. The judgment is affirmed.