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60. Do the parties now have an enforceable contract?
A consulting firm orally agreed to employ an executive as its president for the executive's lifetime. The parties negotiated and have agreed to all aspects of the employment except for the executive's salary, on which they remain several thousand dollars apart. The executive has sent a signed letter to the firm confirming the terms to which the parties have orally agreed while acknowledging that the salary has yet to be set. The firm has not responded to the confirmation letter.
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A is incorrect. A «lifetime» employment agreement is not subject to the statute of frauds. Here, the contract could be fully performed within a year if the employee were to die within that time period.
C is incorrect. This answer choice does accurately state that a «lifetime» employment agreement is not subject to the statute of frauds. However, there is no requirement that parties negotiate about an essential term in good faith. Instead, the parties' failure to expressly agree on an essential term in the contract renders it unenforceable.
D is incorrect. A «lifetime» employment agreement does not fall within the statute of frauds. Therefore, the confirmation letter is not necessary to enforce any contract formed. However, the parties do not have a binding contract, because they have not agreed on the executive's salary, an essential term for an employment agreement.