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Sorrells Bailey Cattle Co by alicejenny

VIEWS: 6 PAGES: 29

									Ag Law – Class #5
August 28, 2002

 Reminder: Book & materials -- $51, payable to Gerald A.
    Harrison
 Questions
 Goal today: Chap. 3, Thru page 50
 See Reserve Reading --Hamilton’s , Production
    Contracts
   Recitation today:
   Sorrells … Ryan Holtkamp
   Straatmann … Gretchen Humphrey
   Zummo … Joshua Johnson
Recitation Friday
 Cases     Student
 Potter -- Drew Mellon
 Kimball -- Kyle Kuehnert
 Pillsbury -- Chris Lindborg
 Ralston – Christopher Mast
Homework #1-- Problem #1, p13
 You have to answer or you may be defaulted.


 Is a writing for this value of a contract?
 Exception to writing in this type of
  transaction?
 Yes, the “merchant’s exception,” but we don’t
  have facts --or law yet, in this course, to
  establish or discuss these points.
Implied Contracts
  Implied by law
    party not aware of mistake
    law may grant the performing party the
     increase in value to the recipient
      it is restitution

      prevents unjust enrichment

  Implied in fact
    party knows of mistake and lets the
     other party proceed.
      Court may imply a promise to pay
 Requirement That Contracts Be In
 Writing

 Statute of Frauds (English Parliament, 1677)
 Certain contracts must be in writing to be enforceable:
 Marriage contracts
 Surety contracts (promises to pay for another)
 Real estate contracts (except certain leases)
 Part performance exceptions
 Contracts that cannot be performed within one year and
 Contracts for the sale of goods worth $500 or more.
   Writing: Sales of Goods--UCC

 IC 26-1-2-201 (1)Except as otherwise provided in this section,
  a contract for the sale of goods for the price of five hundred
  dollars ($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.
Writing: Key Areas for Farmers


   Transfers of real estate
   Farmland leases of more than three years
   Contracts that cannot be performed in one
    year
   Contracts to sell goods of $500 or more
       includes auctions
Sorrells v. Bailey Cattle Co.

     Court of Appeals of Ark., 1980
     Ryan Holtkamp
     Action:


     Issue:



     Facts:
Sorrells v. Bailey Cattle Co.

   Action: To rescind a contract due to seller
    breach.
   Issue: Was there an enforceable contract?
   Facts: - Earnest money paid with a written
    offer on a form with an inadequate
    description.
   That offer was accepted by Bailey Cattle Co.
Sorrells v. Bailey Cattle Co.
   More facts:
   At a later date, the parties executed a
    “Purchaser’s Agreement” without a
    description but attached an undated note for
    the balance of the price, but without a legal
    description, only a county reference
   This later document added stipulations: 9%
    interest,
   Retained 1/2 the mineral rights, and
    stipulated a lesser title “insurance” than the
    first document.
Sorrells v. Bailey Cattle Co.

  Neither referred to the other to allow
   incorporation .
  Different buyers were referenced in
   each.
  Oral testimony left a state of confusion.
  Rule: It takes clear writing to insure an
   enforceable deal.
   Exceptions to the Writing
   Requirement
 Statute of frauds may be interpreted narrowly to
  prevent unfairness or injustices
 Examples:
 1. partial performance
 once work is started there may be a contract
 there must be evidence to prove an oral agreement
 2. promissory estoppel
 applies when one party has relied on a promise to
  his detriment
 See Chapter 11 for a case
Straatmann v. Straatmann, Mo. Ct. of
Appeals, ED, 1991


   Gretchen Humphrey
   Action -
   Issue -
   Applicable law -
   Facts –
   Holding –
   Rule -
Straatmann v. Straatmann
 Action: Enforcement of a contract, and more ...
 Issue: Was there sufficient evidence to support an oral
    agreement to avoid the Statute of Frauds?
      Was there a contract for the equip., and the land?
   Facts:
   Ken, son, was promised equipment and livestock if he
    stayed to help his parents,and he would receive an
    equal share of land.
   In 1966, Ken and wife were furnished a house and a
    “share” of income but no salary or wage.
   Dad, retired in ‘72, and died in ‘73, Hence Ken ran the
    farm paying all the expenses and keeping all income,
    until ‘82!
Straatmann v. Straatmann

  More Facts: In May ’83, Ken sold the cattle and
     kept the proceeds.
    July, ‘83 Mom (appellant) prepared a deed
     retaining a life estate with remainder in her four
     daughters!
    Mom sought a share of the cattle proceeds & ...
    Ken, counterclaimed on “other matters.”
    Ken sought specific performance or an oral
     contract for his share of the farmland.
    Ken, prevailed in the trial court.
Straatmann v. Straatmann

 Law: Partial performance, equitable remedy, may
  support a contract to get around the Statute of
  Frauds defense. Under the “Walker “ standard, in
  Mo. an alleged oral contract must be:
 clear …
 proved as pleaded
 not “too ancient” or from casual conversation
Straatmann v. Straatmann

 oral contract must be:
 “fair”
 in fact, made and performed
 with consideration, and performance demanding
  equity
 shown to be a contract to devise and/or give
  rather than an mere disposition
Straatmann v. Straatmann

 Holding: Specific performance for Ken granted.
 His staying on the farm at the request of Ben was
  consideration whether or not that was his first
  choice.
 Mom admitted that the agreement existed!
 While the Mo. law may only require partial
  performance by the party seeking enforcement,
  Ken had 29 years (since 1961) toward his part of
  the “bargain.”
Straatmann v. Straatmann

 Rule:
 To get the benefit of the remedy partial
 performance, the party must have “clean
 hands,”
 i.e., have done his part under a provable,
 clear, “fair” agreement.
Parol Evidence Rule

 In written agreements, the writing is the best
  evidence of the agreement,
 and evidence of prior or contemporaneous
  agreements is not admissible to contradict a term
  of the writing.
 In short, incorporate the words to give them
  effect.
 Exceptions:
    ambiguity in the terms, or a dispute as to
     meaning
Zummo Cattle Co. v. Millard, Ct. of
Civil Appeals of Tex. ‘72


    Joshua Johnson
    Action
     Issue
     Facts -
     Applicable law -
     Holding -
     Rule -
Zummo Cattle Co. v. Millard

 Action: loss of profits by Zummo
 Issue: Is there a basis for an exception to the
  parol evidence rule?
 Facts:
 The contract said that Millard was responsible
  for “all death losses and mysterious
  disappearances …” (there is no missing term or
  ambiguity)
  Zummo Cattle Co. v. Millard

 Facts: Millard introduced a phone conversation
  with Zummo to let the “loss limit be 3%” before
  Millard would agree to the contract
    But, he didn’t change the writing he signed.
 Trial court held for Millard, limiting his liability to 3%
  for death and mysterious disappearance.
 Law: Statute of Fraud/Parol evidence rule
  Zummo Cattle Co. v. Millard


 Holding:
 Millard is liable under the death loss clause in the
  contract -- all losses!
    Trial court permitted a violation of the parol
     evidence rule
 Rule: Parol evidence rule:-- the writing is the best
  evidence of the agreement, and evidence of prior
  or contemporaneous agreements is not admissible
  to contradict a term in the writing.
Excused Performance

 Don’t have to do what was promised!
 Generally, performance is excused if conditions have so
  changed that the parties would not have entered the
  contract if the changed circumstances existed at the out
  set.
 Impossibility, e.g., subject matter is peculiar and has
  become unavailable
 Impracticability, e.g., crop dusters only plane is
  destroyed
 Frustration of Purpose, e.g., crop to be treated no
  longer exists
Remedies for Breach of Contract

 Damages
    Sufficient to make the party “whole” (to get the
     benefit of his bargain)
    Guideline: market price-contract price=Damages
 Liquidated Damages
    An amount or formula for determining damages
     stipulated in the contract
    Must be reasonable to be enforceable
       “penalties”are not permitted

       or what appears to be coercive
Remedies for Breach of Contract

 Restitution
   payment for benefits already received
 Rescission (an equitable remedy)
   Cancellation of a contract
   with restitution, I.e, payment for benefits
    received.
 Specific Performance
   When the subject matter is unique
   Or, when damages are inadequate
  Statute of Limitations

 Statutory limit on the time to bring an action for
  recovery. To miss the time limit bars the action.
 In common law, if one who did not seek relief in a
  “reasonable” time was barred by the doctrine of
  laches.
Statutes of Limitation in Indiana
 2 years - personal injury; damage to personal property;
  wrongful death; and medical malpractice.
 4 years - contract for the sale of goods (whether written
  or oral).
 6 years - accounts; oral contracts other than the sale of
  goods; rent and landlord-tenant disputes; damage to real
  estate; promissory notes and written contracts for the
  payment of money.
 10 years - An action upon contracts in writing other than
  those for the payment of money, and including all
  mortgages - Other than chattel mortgages, deeds of trust,
  judgments of courts of record, …

								
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