Reference no: EM131377973
Enrique Gittes was a financial consultant for NCC, an English holding company that invested capital in other businesses in return for a stake in those businesses. One of NCC's investments was a substantial holding in Simplicity Pattern Company. Gittes's consulting contract was subsequently transferred to Simplicity, and Gittes was elected to the Simplicity board of directors. When NCC fell into serious financial straits, it became imperative that it sell its interest in Simplicity.
Accordingly, a buyer was found. The buyer insisted that before closing the deal all current Simplicity directors, including Gittes, must resign. Gittes, however, refused to resign. Edward Cook, the largest shareholder of NCC and the one with the most to lose if the Simplicity sale was not completed, orally offered Gittes a five-year, $50,000-per-year consulting contract with Cook International if Gittes would resign from the Simplicity board.
Gittes and Cook never executed a formal contract. However, Cook International did issue two writings, a prospectus and a memo, that mentioned the employment of Gittes for five years at $50,000 per year.
Neither writing described the nature of Gittes's job or any of his duties.
In fact, Gittes was given no responsibilities, and was never paid. Gittes sued to enforce the employment contract. Cook International contended that the statute of frauds made the oral contract unenforceable. Decision?
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