On this date in 1952, the Supreme Court issued its opinion in Savarese v. Pyrene Manufacturing Co., 9 N.J. 595 (1952). Justice Wachenfeld’s decision for a 5-0 Court remains the leading authority on whether and when employment contracts for life are enforceable.

The key events of this case took place in 1929, when plaintiff, who had been employed by defendant since 1917, was a labor foreman in charge of a receiving department. More importantly for the circumstances of this case, plaintiff also played on defendant’s baseball team in the Industrial Twilight League. The team was a vehicle for defendant’s advertising.

In 1929, “a Mr. Weed, secretary and second vice-president of the company in charge of sales and advertising,” asked plaintiff to become the baseball team’s manager. Plaintiff agreed. But later,  Mr. Weed had another request, as Justice Wachenfeld recounted.

“Before the playing season opened in that year, Weed again spoke to the plaintiff complaining of the lack of experienced players and asked him actively to participate in the games as a catcher. The latter demurred on the ground he was getting too old and didn’t ‘feel as if I could get out there physically.’ He stated he had just come out of the hospital and asked what would happen to him if he should get hurt. Weed reportedly answered: ‘If you get hurt I will take care of you. You will have a foreman’s job the rest of your life.’ The plaintiff alleges Weed specified the job as ‘the one I had, the one I earned.’” There was no writing memorializing this arrangement.

Perhaps inevitably, plaintiff got seriously injured while playing baseball. Despite that, he remained employed by defendant until April 1, 1950. On that date, he received a letter that his employment was being terminated. Enclosed with the letter was a check for a four-figure sum, which the letter stated was “made to you not only in recognition of your many years of faithful service to the Company, but also because the Company desires to have available to it in the future the benefit of your experience and of your knowledge of its affairs which you have acquired from your long association with it. You may be sure that, although we may seek your advice from time to time, we shall not make unreasonable requests.” Plaintiff cashed the check.

Plaintiff sued for damages, alleging the oral agreement to have employment for life as a foreman. Defendant moved for summary judgment, which the Law Division granted on multiple grounds. Those included that “even if the contract and Weed’s authority to bind the corporation to it were admitted, nevertheless the damages were uncertain and unliquidated and the acceptance of the sum of $3,000 was, under these circumstances, tantamount to and operated as an accord and satisfaction, precluding the maintenance of the action.” Plaintiff appealed, and the Supreme Court took the case up on the Court’s own motion prior to argument in the Appellate Division.

The Court held that the terms of the alleged employment for life agreement were not definite enough to be enforced. After citing prior New Jersey and out-of-state cases, and other sources of law, the Court said that “Deeming them to be at variance with general usage and sound policy, the courts have shown a marked reluctance to enforce contracts for life employment…. Agreements of this nature have not been upheld except where it most convincingly appears it was the intent of the parties to enter into such long-range commitments and they must be clearly, specifically and definitely expressed. Only then is it grudgingly conceded that not all such contracts are so vague and indefinite as to time as to be void and unenforceable because of uncertainty or indefiniteness.”

The proofs here did not meet that “grudging” test. “Here no salary was agreed upon nor was provision made as to what would occur if the plaintiff became wholly or partially unable to perform his duties or fulfill the terms of his contract. It was not stipulated whether the current salary was to be increased or decreased, depending upon the circumstances and business conditions encountered, making it comparable to that of other employees. No mention was made of the effect disability would have or whether it would vary depending upon its being connected with or disassociated from baseball activities. Many other possible future contingencies were not covered by or provided for in the agreement made.” The oral arrangement was more like a “friendly assurance of employment,” not a binding contract for life.

The Court also agreed with the Law Division that plaintiff had not proven that Weed had authority to bind defendant, an independent reason for granting summary judgment to defendant. The Justices had “doubt” about the accord and satisfaction idea on which the Law Division relied, but chose not to reach that issue given its other rulings.

This case has continued to be cited, including as recently as last year (though not always in the context of lifetime employment contracts). Contracts for lifetime employment are not necessarily unenforceable, but there is a significant burden on an employee who seeks to prove such a contract, as this case held 73 years ago today.