New York Law Review

Tag: Unsigned Agreement

  • American Federation of State, County and Municipal Employees, AFL-CIO v. Shaffer, 66 Misc. 2d 272 (N.Y. Sup. Ct. 1971): Enforceability of Unsigned Collective Bargaining Agreements

    American Federation of State, County and Municipal Employees, AFL-CIO v. Shaffer, 66 Misc. 2d 272 (N.Y. Sup. Ct. 1971)

    An unsigned collective bargaining agreement can be binding if evidence demonstrates both parties acquiesced to its terms and intended it to be a binding contract, even without formal execution.

    Summary

    This case addresses whether a collective bargaining agreement is binding when it has not been formally signed. The American Federation of State, County and Municipal Employees sought to enforce an agreement with New York City despite the lack of signatures. The court held the agreement enforceable, finding that the City had demonstrated its acceptance through conduct and intent, making a signed document unnecessary. The key issue was whether there was sufficient evidence of mutual assent and intent to be bound, notwithstanding the missing signatures, thus deviating from a strict requirement of formal execution.

    Facts

    The American Federation of State, County and Municipal Employees (the Union) engaged in collective bargaining with New York City. After negotiations, an agreement was reached concerning the terms of employment for certain city employees. The agreement included a parity provision. Although the terms were agreed upon, the agreement was never formally signed by either party. The Union sought to enforce the terms of the unsigned agreement, claiming the City had acquiesced to the terms and intended to be bound by it.

    Procedural History

    The case originated in the trial court, which granted summary judgment to the Union, enforcing the unsigned agreement. The Appellate Division affirmed this decision, holding that no factual issue existed regarding the City’s acceptance and intent to be bound. The case then reached the New York Court of Appeals. The Court of Appeals was divided, with the majority affirming the lower courts’ decisions.

    Issue(s)

    Whether an unsigned collective bargaining agreement is enforceable when there is evidence of both parties’ acquiescence to its terms and an intent to be bound by it, even without formal signatures.

    Holding

    Yes, because the evidence demonstrated that the City had acquiesced to the terms of the agreement and intended to be bound by it, despite the absence of a formal, signed contract.

    Court’s Reasoning

    The court reasoned that a strict requirement of a signed, formal document would be unworkable in the context of public sector collective bargaining. The critical factor is whether the parties manifested a mutual intent to be bound by the agreement’s terms. Evidence of such intent can include conduct, correspondence, and other actions demonstrating acceptance of the agreement. The court noted that the City’s actions indicated it had accepted the agreement’s terms. In his dissenting opinion, Chief Judge Fuld emphasized the lower courts’ findings of fact that the city acquiesced to the parity provision and intended a binding agreement. The dissent highlighted that absent an “inexorable rule” requiring a formal signed document, the summary judgment for the plaintiffs should be affirmed based on the established facts.

  • Scheck v. Francis, 26 N.Y.2d 466 (1970): Statute of Frauds and Intent to be Bound by a Signed Writing

    Scheck v. Francis, 26 N.Y.2d 466 (1970)

    An agreement is not binding if the parties do not intend to be bound until it is reduced to writing and signed by both of them, and a letter of transmittal for unsigned contracts does not satisfy the Statute of Frauds if it lacks language indicating a present intent to be bound.

    Summary

    George Scheck, Connie Francis’s former manager, sued Francis and her corporations for breach of employment agreements. The agreements, although signed by Scheck, were never signed by Francis. Scheck argued that the agreements and a cover letter from the defendants’ attorney constituted a sufficient memorandum under the Statute of Frauds. The court held that the Statute of Frauds barred the claim because the letter did not establish a contractual relationship or indicate an intent to be bound until both parties signed the agreements.

    Facts

    George Scheck managed Connie Francis for many years. After the expiration of a previous employment agreement, they negotiated new contracts in February 1968. The defendants’ attorney, Marvin Levin, sent four proposed agreements in quadruplicate to Scheck with a cover letter dated April 15, 1968, instructing Scheck to sign all copies and have Connie Francis sign them. Scheck signed promptly, but Francis never signed. He continued to work for the defendants until August 12, 1968, when he was told not to negotiate further for Francis’s services unless she notified him in writing. In March 1969, Scheck was informed that no contracts existed between him and Francis, leading to his lawsuit for damages.

    Procedural History

    The trial court dismissed Scheck’s complaint, finding it barred by the Statute of Frauds. The Appellate Division affirmed. The New York Court of Appeals granted leave to appeal.

    Issue(s)

    Whether the unsigned agreements, coupled with the attorney’s covering letter, constituted a sufficient memorandum to satisfy the Statute of Frauds, thereby creating an enforceable contract even without Francis’s signature.

    Holding

    No, because the writings evidenced the parties’ intention not to be bound until the agreements were signed by both parties, and the attorney’s letter did not serve to establish a contractual relationship.

    Court’s Reasoning

    The court reasoned that parties are not bound by an agreement until it is reduced to writing and signed by both, if that is their intent. The court distinguished this case from Crabtree v. Elizabeth Arden Sales Corp., which held that a memorandum satisfying the Statute of Frauds could be pieced together from separate writings if they clearly referred to the same subject matter and at least one writing was signed by the party to be charged. Here, Levin’s letter was merely a transmittal for unsigned contracts and lacked “in praesenti language.” The court emphasized that “the letter drafted by defendants’ attorney, as stated on its face, was intended merely as a means of transmittal to the plaintiff of unexecuted contracts.” The court noted that the letter did not establish a contractual relationship, authenticate any information in the unsigned contracts, or indicate an intent to bring a contract into existence. It was merely a step in negotiations. The court concluded that the parties understood the agreements would take effect only after both had signed, and until then, the matter remained in the negotiation stage. The court found that where writings are plainly insufficient on their face, as in this case, they do not satisfy the Statute of Frauds. The court stated that where it is clear from the writings themselves that they do not constitute a memorandum sufficient to satisfy the statute, it is “immaterial” whether or not they “accurately reflect and contain all of the pertinent terms of a prior alleged oral agreement…which does not purport to be authenticated by any signature of the defendants or their agent.”