Stearns v. Emery-Waterhouse Co.
Supreme Judicial Court of Maine
596 A.2d 72 (Me. 1991)
Stearns (plaintiff), a Sears manager, orally agreed with Emery-Waterhouse (defendant) to work for five years at a guaranteed $85,000 salary. He left Sears and worked as Emery-Waterhouse's director of regional sales for two years at that salary before being reassigned to a lower-paying job, then terminated after six months -- about two and a half years short of the promised term. Stearns sued for breach of contract. The trial court ruled for Stearns despite the oral contract falling under the statute of frauds, reasoning his detrimental reliance made it enforceable. Emery-Waterhouse appealed.
Whether an oral employment contract that falls under the statute of frauds is enforceable, without proof of actual fraud, based solely on the employee's detrimental reliance on the employer's promise.