Q: I'm general manager of a South Florida trucking company and am working in year three of my five-year employment contract.The business owners agreed to sell out to a Georgia buyer, and my contract is part of the sale. The contract is silent about my rights. The buyer just delivered a letter telling me to report for work in Atlanta. I don't want to go. What's the legal deal here?

-- Stay at Home Sam

A: Your business law problem involves third-party rights. You and your employer have a direct contract relationship. The new owner is an outsider, claiming enforceable contract rights by virtue of its sale. In legal terms, you are the obligor, your former employer is the transferor -- assignor, and the new owner is the transferee -- assignee. Stated simply, the legal issue here is whether or not your consent to the assignment of your employment contract is required?

As a general rule, there is no legal requirement that an obligor approve an assignment of his contract. These situations usually occur where the contract involves a sale of goods or services to the obligor for a stated payment amount. The obligor can just as easily pay his original contract creditor or an assignee creditor.

But there are fairness exceptions to this general rule in which prior consent or approval of the obligor is required. They are all based on whether or not the obligor is personally affected in a significant way by the desired assignment. If it causes ``material hardship'' to the obligor, consent is required.

You certainly appear to qualify for the protection of the hardship exception. Having to suddenly relocate yourself and family to a new city involves many legitimate concerns. Recent cases also suggest that your consent would still be necessary even if the new owner had agreed to pay your moving and related expenses. It could also be argued that you would still be under the hardship umbrella even if the business sale was within your same home state or city. Protection of the employee is emphasized.

Skillful drafting of clauses in your direct contract could have protected you or your employer by anticipating these problems. You could have required a ``no assignment without my consent'' clause. It is commonly used to protect key employees. Your employer could have made your contract freely assignable. This is standard leverage in the process of hiring key employees.

Employment contract assignment disputes rarely involve professional sports contracts even though the same hardship factors exist that require employee consent. This is because they usually are freely assignable without the athlete's consent. Their power to veto contract transfers comes from their collective bargaining labor agreements.

You may have a bargaining advantage if sale of the business depends on effective transfer of your employment contract. Since your legal rights are now clearer, we suggest you and your counsel arrange a meeting with your old employer and the new buyer. You might be able to renegotiate a financially attractive new contract.

IS VERBAL BUSINESS

CONTRACT BINDING?

Q: Our business is selling reconditioned computers. We agreed with a computer dealer to sell some of our excess inventory for $3,500. Their agreement was verbal but was made in the presence of witnesses. Now they can buy similar goods from another seller for less, so they want to cancel their verbal agreement. We spoke to two Florida lawyers. One said our verbal contract wasn't binding. The other said it was binding because of a change in the law. What's your opinion?

-- To Write or Not to Write

A: Our opinion is that you can't enforce your verbal agreement. Most verbal contracts are legally enforceable, though difficult to prove without witnesses. However a body of English law called the Statute of Frauds requires certain types of agreements to be in written form to be enforceable. The main categories are verbal contracts: for real estate, debt guarantees, one year or more performance of services and sales of goods for $500 or more under the UCC.

Your situation falls into the last category. Therefore your verbal agreement must have been written to be legally binding. The required writing could have been anything from a formal contract to a confirming letter, memo, e-mail or other written communication between the parties. You had no such writing.

The change in the law you mention was proposed in 2003 in amendments to Article 2 of the UCC, raising the Statute of Frauds sales of goods dollar threshold from $500 to $5,000. If it was adopted in Florida, your verbal agreement would have been binding on the buyer because it was less than the revised limit. But no states have yet enacted this Article 2 amendment, and none have announced plans to do so. So your verbal sale of goods for $3,500 fails due to lack of the required writing.

Ask Doctor Law appears every first Monday of the month in Business Monday. Send questions to Martin E. Segal, a licensed attorney, who lectures in business law at the University of Miami School of Business Administration. Visit him at: askdoctorlaw.blogspot.com.

Disclaimer: This column is not intended to be a solicitation of legal business or the furnishing of self-help legal advice. Laws vary from state to state. Readers are strongly urged to consult independent and qualified legal professionals before making any business decisions. The views expressed are those of the writer and not of The Miami Herald.