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Greene v. Oliver Realty, Inc. - 363 Pa. Super. 534, 526 A.2d 1192 (1987)

Rule:

The employment at-will presumption may only be rebutted by clear evidence that the parties contracted for a definite period. Because a contract for lifetime employment constitutes such a tremendous obligation, courts must require evidence beyond mere proof of the parties' agreement. A promise of permanent or lifetime employment may be nothing more than a casual aside. Or, it may be purely aspirational. The employer may be expressing his hope that a valued employee will stay with him forever. However, he may not have intended to create a binding agreement. These dangers are sufficiently real that courts must look to the circumstances surrounding the parties' agreement. Only when those circumstances demonstrate the parties' intent by clear evidence should a court enforce a lifetime employment contract. The presence of additional consideration is only a single factor, albeit an important one, which a court must consider to ascertain that intent.

Facts:

Appellant, William Greene began working for Grant Building, Inc. in 1959. Greene allegedly agreed to work at a pay rate below union scale in exchange for a promise that Grant would employ him "for life". In 1975, appellee Oliver Realty, Inc. took over management of Grant Building but Oliver's president assured former Grant employees that existing employment contracts would be honored. During that same year Greene explained the terms of his agreement to an Oliver Realty supervisor. The supervisor stated that he would look into the matter but never got back to Greene. Eight years later, Greene was laid off and he brought this action for breach of contract. The trial court found that Oliver had impliedly adopted the oral contract between Greene and Grant Building. The trial court ruled that under Pennsylvania law a contract "for life" is a contract at will. The trial court also held that a contract at will may become a contract for a reasonable time if it is supported by sufficient additional consideration other than the employee's services. The court stated that there was no such consideration in this case. It found that Greene worked for subunion wages in order to avoid layoff, not in exchange for lifetime employment. It also held that even if sufficient additional consideration was present, the period of 1975 to 1982 constituted a reasonable time. Therefore, there was no breach of the contract, and the court granted Oliver's motion for summary judgment.

Issue:

Did the trial court err in its ruling that there was no breach of contract?

Answer:

Yes

Conclusion:

The Court ruled that that at-will presumption of employment agreement could only be rebutted by clear evidence that the parties contracted for a definite period and that when the court was certain of the parties' intent, it had to enforce that intent irrespective of whether additional consideration was present. In the instant case, Oliver Realty impliedly adopted Grant Building's promise to Greene of lifetime employment. In exchange for that promise, Greene alleged that he worked for 24 years at a pay rate below union scale. A trial court must allow an issue to go to the jury unless it is so clear that reasonable minds could not possibly differ over its resolution. The trial court concluded that Greene worked at sub-union rates in exchange  for a promise that he would not be laid off and not in exchange for a lifetime contract. This is an inappropriate conclusion. This is a factual issue which must be submitted to a jury. Greene's belief that he had been promised lifetime employment was sufficiently strong that he explained his position to a supervisor after Oliver took over Grant Building. The court must allow the jury to consider Greene's alleged "additional consideration" as well as all the circumstances surrounding the agreement. A jury might reasonably interpret the above cited facts so as to conclude that Greene has clearly rebutted the at-will presumption. Based on the above analysis, the Court reversed and remanded for further proceedings.

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