Class 16 Statute of Frauds II by efctflxG

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									                    Problem 100
• Bea Potter was hired by MacGregor Agricultural
  Enterprises as a bookkeeper for a two-year period;
  her salary was to be $34,000 a year. The contract was
  oral. After she had worked for a two-month period,
  she was wrongfully accused of stealing and was fired
  on the spot. When Potter brought suit, MacGregor
  defended on the basis of the lack of a writing. If this
  defense is successful, may she nonetheless recover
  for the two months she worked? Under what theory?
  How would her damages be measured?
    Wagers v. AMI Issues Presented
1. Whether plaintiff ’s unilaterally executed earnest
money agreement, together with the letters
exchanged between the parties’ respective attorneys,
constitute a sufficient writing of a sale of land to
satisfy the statute of frauds?
2. Whether plaintiff ’s arrangement of financing for
development of the subject of the sale constituted
sufficient part performance to make the sale an
exception to the statute of frauds.
     Wagers v. AMI Issues Presented
Preliminary Qustions
• Why is this contract subject to the Statute of
  Frauds?
• Do the letters together with the unilaterally signed
  earnest money agreemen tsatisfy the statute?
     Wagers v. AMI Issues Presented
What is the part performance exception?
     Wagers v. AMI Issues Presented
What is the part performance exception?
 “Part performance is a recognized exception of the
 requirement of the statute of frauds. One of the
 requirements of the doctrine of part performance is
 that the acts relied upon as constituting part
 performance must unmistakably point to the
 existence of the claimed agreement.”
     Wagers v. AMI Issues Presented
How is this applied to real estate cases?
     Wagers v. AMI Issues Presented
How is this applied to real estate cases?
 “The principal elements or circumstances involved
 in determining whether there has been sufficient
 part performance by a purchaser of real estate
 under an oral contract otherwise within the statute
 of frauds, are (1) delivery and assumption of actual
 and exclusive possession of the land; (2) payment or
 tender of the consideration, whether in money,
 other property, or services; and (3) the making of
 permanent, substantial, and valuable
 improvements, referable to the contract.”
     Wagers v. AMI Issues Presented
What part performance is alegeded here?
     Wagers v. AMI Issues Presented
What part performance is alegeded here?
 Arranging Financing
  § 139. Enforcement By Virtue Of Action In
                 Reliance
(1) A promise which the promisor should reasonably expect to induce action or
forbearance on the part of the promisee or a third person and which does induce the
action or forbearance is enforceable notwithstanding the Statute of Frauds if injustice can
be avoided only by enforcement of the promise. The remedy granted for breach is to be
limited as justice requires.

(2) In determining whether injustice can be avoided only by enforcement of the promise,
the following circumstances are significant:

(a) the availability and adequacy of other remedies, particularly cancellation and
restitution;

(b) the definite and substantial character of the action or forbearance in relation to the
remedy sought;

(c) the extent to which the action or forbearance corroborates evidence of the making and
terms of the promise, or the making and terms are otherwise established by clear and
convincing evidence;

(d) the reasonableness of the action or forbearance;

(e) the extent to which the action or forbearance was foreseeable by the promisor.
                Problem 101
Mary’s Used Cars orally agreed to sell Harry a 1978
Special Corvette Pace Car for $4,000. Harry made a
$300 down payment. When Harry went to pick up
the car, he was told there was no contract because
of the lack of a writing. When Harry pointed to UCC
§2-201(3)(c), Mary’s manager just laughed and
offered to give him a bumper worth $300. Who
wins? If he had paid by a check, would the check
itself have satisfied the writing requirement (Mary’s
Used Cars would have indorsed it when it was
cashed)?
       § 2-201. Formal Requirements; Statute of Frauds.
(1) Except as otherwise provided in this
section a contract for the sale of goods for the
price of $500 or more is not enforceable by
way of action or defense unless there is some
writing sufficient to indicate that a contract for
sale has been made between the parties and
signed by the party against whom
enforcement is sought or by his authorized
agent or broker. A writing is not insufficient
because it omits or incorrectly states a term
agreed upon but the contract is not
enforceable under this paragraph beyond the
quantity of goods shown in such writing.
(3) A contract which does not satisfy the requirements of
subsection (1) but which is valid in other respects is
enforceable
(a) if the goods are to be specially manufactured for the buyer
and are not suitable for sale to others in the ordinary course
of the seller's business and the seller, before notice of
repudiation is received and under circumstances which
reasonably indicate that the goods are for the buyer, has
made either a substantial beginning of their manufacture or
commitments for their procurement; or

(b) if the party against whom enforcement is sought admits in
his pleading, testimony or otherwise in court that a contract
for sale was made, but the contract is not enforceable under
this provision beyond the quantity of goods admitted; or

(c) with respect to goods for which payment has been made
and accepted or which have been received and accepted
              Problem 102
Scarlett decided to sell Tara, her ancestral
home, to Rhett, and they entered into an oral
contract that specified all of the details. At the
closing she decided at the last moment that
she just couldn’t bear to go through with the
deal, so she refused to sign the contract that
he had had prepared. When he sued, she
defended on the basis of the statute of frauds,
              Problem 102
although she took the witness stand and when
shown the copy of the contract that she had
refused to sign she readily admitted that it
correctly reflected all of the terms of their oral
agreement. As the judge, how would you rule
on the statute of frauds issue? Was it
unethical to plead the statute in such a case?
                   Problem 103
Artist Basil Hallward orally agreed to sell his five finest
paintings at the      rate of one a year for the next
five years to Henry Wotton. The price was to be
    $10,000 for each painting. When the time came
for delivery of the first painting, Basil couldn’t bring
himself to part with it. When Henry sued, Basil
admitted the contract from the witness stand.
                 Problem 103
Henry’s attorney argued that this admission
destroyed Basil’s statute of frauds defense, but the
other side pointed out that the contract could not be
performed within one year and therefore the
common law statute of frauds required a writing even
if the UCC did not. How should this come out?
         Thomson v. Goodrich
• Why is contract subject to Statute of Frauds?
• What exceptions are at issue?
(2) Between merchants if within a reasonable time a
writing in confirmation of the contract and sufficient
against the sender is received and the party
receiving it has reason to know its contents, it
satisfies the requirements of subsection (1) against
such party unless written notice of objection to its
contents is given within 10 days after it is received.
         Thomson v. Goodrich
• Does an un-objected to confirmation mean a
  contract exists?
          Thomson v. Goodrich
• Does an un-objected to confirmation mean a
  contract exists?
  “The sender must still persuade the trier of
  fact that a contract was in fact made orally, to
  which the written confirmation applies.”
         Thomson v. Goodrich
• What element in 2-201(2) is in issue?
         Thomson v. Goodrich
• What element in 2-201(2) is in issue?
• “and the party receiving it has reason to know
  its contents,”
         Thomson v. Goodrich
• What element in 2-201(2) is in issue?
• “and the party receiving it has reason to know
  its contents,”
• How does Goodrich interpret this prong?
         Thomson v. Goodrich
• What element in 2-201(2) is in issue?
• “and the party receiving it has reason to know
  its contents,”
• How does Goodrich interpret this prong?
• It must be received by a particular person “at
  Goodrich who had reason to know its
  contents.”
                 Problem 104
Despard Murgatroyd, knowing the reputation that
the Oakapple Farms had for slow responses, sent a
letter to the Farms stating the terms of a mythical
phone conversation between the two parties in
which Oakapple Farms had supposedly agreed to sell
all of its 2001 crop to Despard. The letter was
received by Oakapple Farms on the first of December
2012, and on February 8, 2013, the sales manager
sent back a letter to Despard informing him that no
such deal existed. Despard filed suit, pointing to UCC
§2-201(2).
                  Problem 104
If there really had been an oral deal, but the letter
did not correctly reflect its terms, could that still be
an issue in the resulting lawsuit?
                  Problem 105
  When Charles Baskerville decided to sell his house,
  the buyer was lawyer John Watson. The parties
  orally agreed to the terms but never signed a
  writing. If Watson backs out of the deal, is the need
  for a writing excused where
(a) Watson told Baskerville that no writing was
  required for the validity of this sale? Would your
  answer change if Watson were not a lawyer?
                   Problem 105
(b) Baskerville signed the writing and mailed it to
  Watson, who phoned Baskerville and told him he
  had signed it? In fact, Watson never got around to
  actually putting pen to paper.
(c) Watson told Baskerville that they ought to sign a
  writing but added, ‘‘Never mind about these legal
  technicalities. I promise never to raise this issue’’?
• What is the difference between R 139
  (Promissory Estoppel) and being estopped
  from pleading the statute due to
  misrepresentations about a writing?

								
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