Professional Bull Riders, Inc. v. AutoZone, Inc. – Case Brief
Professional Bull Riders, Inc. v. AutoZone, Inc., 113 P.3d 757 (Colo. 2005).
Case Summary
Facts: AutoZone (D) sponsored events for the Professional Bull Riders (P). Professional Bull Riders prepared a written agreement to secure AutoZone’s sponsorship. The agreement was for two years but provided D with the option to cancel within the first year. D never signed the agreement. D performed but notified P in January 2002 that it would not be sponsoring P’s events in 2002. This was well after the August 2001 drop dead date in the written agreement. P sued D for a breach of the oral sponsorship agreement. The district court granted summary judgment in favor of D on the grounds that the oral contract could not be performed within one year and was therefore unenforceable under the Colorado statute of frauds.
Issue: Is an oral agreement void when: the agreement contemplates performance for a definite period of more than one year – but allows the party an option to terminate the agreement by a certain date less than a year from the making of the agreement – even when the party has not exercised the option to terminate the agreement?
Holding and Rule: No. Courts tend to construe the one year provision of the statute of frauds very narrowly to void the fewest number of oral contracts. The one-year period runs from the time that the contract was made to the time for completion of performance. The provision is universally understood to apply only to agreements that, by their terms, are incapable of being performed within one-year. A promise of two or more performances, in the alternative, does not fall within the one-year provision if any one of the alternatives could be fully performed within one year. No contract is within the one year provision that may be fairly and reasonably interpreted such that it may be performed within one year. Where the terms of an agreement can fairly and reasonably be interpreted to define alternate obligations, one or more of which can be performed within one year, the agreement in question may be fairly and reasonably interpreted such that it may be performed within one year.
In this case D had two alternative means for satisfying its obligations and one of them could be performed within one year; therefore the contract does not fall within the one year provision and is not void.
Disposition: Reversed – for P.