286
Chapter 15
The Statute of Frauds—
Writing Requirement and
Electronic Records
Case 15.1
Ga.App.,2010.
Salim v. Solaiman
302 Ga.App. 607, 691 S.E.2d 389, 10 FCDR 632
Court of Appeals of Georgia.
SALIM
v.
SOLAIMAN et al.
No. A09A1686.
the parties’ purchase agreement was inadequate, rendering the agreement unenforceable.
Salim bought the property and business, a convenience store and gas station, located at 199 Upper Riverdale Road in Jonesboro
in October 2006. He made some improvements to the property and then offered it for sale. Solaiman and Chowdhury approached
Salim about buying the property in December 2006. After negotiating a purchase price of $975,000, the parties signed a
handwritten document memorializing the terms of the agreement and on December 26, signed a more formal, typewritten
the January 5 closing date. Accordingly, they proposed postponing the closing and asked their attorney to prepare addendums to
the purchase agreement that would have extended the closing to as late as January 31, 2007. Salim denied ever seeing the
addendums, however, and they were never signed by the parties.
In any event, the closing did not occur on January 5. And after receiving the title report in mid-January, Solaiman and Chowdhury
decided that they no longer wanted to buy the property.FN1 They notified Salim of their decision and asked for reimbursement of the
FN1. Salim sold the property to another buyer at a lower purchase price in February 2007.
The trial court issued judgment in favor of Solaiman and Chowdhury after finding the parties’ purchase agreement to be
unenforceable because “it does not sufficiently describe the real property to be purchased.” Because Solaiman and Chowdhury
first raised this issue before the trial court in their closing argument, the court allowed Salim additional time after the bench trial to
submit briefing, and the court considered that briefing in issuing its ruling. The trial court concluded that even if the property
description in the agreement was sufficient to provide a key for considering extrinsic evidence to identify the property, no such
extrinsic evidence was tendered at trial. Thus, the court concluded that it could not enforce the purchase agreement.
[1][2][3] “The court is the trier of fact in a bench trial, and its findings will be upheld on appeal if there is any evidence to support
them. The plain legal error standard of review applies where the appellate court determines that the issue was of law, not fact.”
288 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
contract for purchase[ ] is measured by the same yardstick as that contained in a deed.”) (citation omitted).
The property description contained in the four corners of the purchase agreement clearly fails to identify the land at issue with the
FN3. (Footnote omitted.)
Swan Kang, Inc. v. Kang,
243 Ga.App. 684, 688-689(3), 534 S.E.2d 145 (2000).
FN4. See, e.g.,
Essuon v. Raynor
, 231 Ga. 297, 201 S.E.2d 416 (1973) (extrinsic evidence allowed where contract gave
street and city address for property, but did not specify county);
Faulkner
, 207 Ga. at 354, 61 S.E.2d 478 (parol evidence
admissible on contract for sale of “old Post Office Building” in Bartow County);
Nhan v. Wellington Square
, 263 Ga.App.
717, 721-722(1), 589 S.E.2d 285 (2003) (the contract’s description of the shopping center to be conveyed as “Wellington
Square at Indian Trail Lilburn and Dickens Road” was a sufficient “key” to allow the court to consider extrinsic evidence).
[8] Salim argues, however, that the trial court erred in failing to consider evidence introduced at trial that served to identify the
property. He points to admissions by Solaiman and Chowdhury that they had visited the property many times and that Chowdhury
had acted as a scrivener of the purchase agreement. Salim also points to testimony that Solaiman and Chowdhury had received a
title search on the property from their attorney. Although he concedes that the title search was not entered into evidence, he
argues that the trial court should have considered the fact of its existence in weighing the adequacy of the property description. But
neither these admissions nor the fact of a title search leads unerringly to the property in question. They do not demonstrate with
sufficient certainty Salim’s intention with regard to the location and quantity of land to be conveyed. Although the title search may
have potentially provided the requisite evidence, it was not introduced for the trial court’s consideration.
Accordingly, we affirm the trial court’s holding that the parties’ purchase agreement was void for lack of an adequate property
Case 15.2
— F.Supp.2d —-, 2007 WL 222575 (D.Kan.)
SCHOOL-LINK TECHNOLOGIES, INC., Plaintiff,
v.
APPLIED RESOURCES, INC., Defendant.
No. 05-2088-JWL.
STATEMENT OF MATERIAL FACTS
ARI is in the business of supplying computer hardware for point-of–sale systems. It manufactures and sells “kiosks,” which are
computers encased in secure, rugged chassis on which card readers, currency adaptors, coin acceptors, or other payment devices
are mounted. SLT is in the business of selling food service technology solutions to schools throughout the country. The two
companies’ business relationship began when SLT received a Request for Proposal (RFP) from the New York City Department of
contract, and that SLT needed a vendor who could supply quickly, “who could help [SLT] out of the bind [it was] in, who could do
the pilot, and would then have the business at New York City schools of 1,500 kiosks.” Noyes Dep. at 67:7-10. SLT wanted ARI to
provide the information needed for its response to the NYCDOE RFP, and it wanted ARI to participate in the pilot project if SLT
was ultimately chosen as one of the two finalists for the pilot project.
*2 According to an affidavit submitted by E. Brooks Lilly, founder and president of ARI, SLT told ARI that NYCDOE was seeking to
did not offer a lot of outside third-party products. She testified that, although SLT had promised to use ARI as the supplier of kiosks
for the NYCDOE business, it was her understanding that SLT wanted to be able to offer its own kiosks, its own solution, and that it
was “[her] belief that [SLT] wanted to do that all along.” Noyes Dep. at 83:16-17. An e-mail from Ms. Noyes to Chip Goodman,
another individual with SLT, reveals that Ms. Noyes was aware as early as June 30, 2004, of SLT’s intent to cut ARI out of the
NYCDOE project by building its own kiosks or using a different supplier.
a representative of SLT made “an extremely disparaging remark about ARI” to potential clients. Noyes Dep. at 125:17. SLT invited
ARI to ship kiosks to a trade show and participate in SLT’s booth as SLT unveiled ARI’s new kiosk to SLT’s customers, but then
SLT cut ARI’s labels off the shipping boxes to conceal ARI’s involvement. SLT was secretively, and unbeknownst to ARI, creating
or trying to create its own products based on knowledge it had received from ARI.
*3 SLT’s proposed “master agreement” contained new and onerous terms that had never before been discussed by the parties.
In an e-mail from Mr. Lilly to Chip Goodman with SLT dated November 2, 2004, Mr. Lilly informed SLT that ARI had suspended
production of products for SLT until the parties reached a resolution to their dealings, and that ARI would not provide the balance
of the PAD devices until after the parties agreed to a “concluding document” which clearly terminated their business relationship
and confirmed confidentiality to provide protection of ARI’s intellectual property. He stated that ARI would “account for [its]
expenses in deploying the NYCDOE pilot and deduct those expenses from the pre-payments made by SL-Tech.” The e-mail
$55,000 in SLT’s prepayment for goods which ARI refused to supply. Additionally, the kiosks purchased by SLT to mitigate
damages cost substantially more than the kiosks ordered from ARI.
*4 The goods ARI sold to SLT were covered by a warranty of repair or replacement. Certain goods delivered to SLT failed to
perform as warranted. SLT claims that some of the goods which were delivered by ARI were defective and that ARI refused to
credit SLT for those goods or remedy the defective equipment. Mr. Lilly, however, testified in his deposition that ARI honored its
SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate if the moving party demonstrates that there is “no genuine issue as to any material fact” and that
it is “entitled to a judgment as a matter of law.” . In applying this standard, the court views the evidence and all reasonable
inferences therefrom in the light most favorable to the nonmoving party. . A fact is “material” if, under the applicable substantive
law, it is “essential to the proper disposition of the claim.” (citing ). An issue of fact is “genuine” if “there is sufficient evidence on
Finally, the court notes that summary judgment is not a “disfavored procedural shortcut”; rather, it is an important procedure
“designed ‘to secure the just, speedy and inexpensive determination of every action.’ ” .
ANALYSIS
For the reasons explained below, the court will grant SLT’s motion for summary judgment on ARI’s counterclaim for breach of oral
contract to the extent that claim is barred by the statute of frauds. That claim is not, however, barred by the statute of frauds with
1. Purchase Contract
SLT’s initial arguments in support of its motion for summary judgment are based on the statement contained in its purchase order
dated August 13, 2004, which included the following term: “The parties agree that by issuing and accepting this quote and order All
Products required by NYC DOE from SL-Tech shall be provided by ARI subject to reaching a mutually agreeable contractual
document by September 15, 2004.” SLT contends, first, that the exclusivity restriction was “subject to reaching a mutually
parties reached a mutually agreeable written contract by September 15, 2004, which they failed to do. In support of this argument,
SLT cites case law involving the parol evidence rule under Kansas common law. This case, however, involves the sale of goods
292 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
and therefore the applicable parol evidence rule is set forth in the Kansas Uniform Commercial Code (the Kansas UCC), .
See,
e.g.,
(applying the parol evidence rule set forth in in a case involving a contract for the sale of goods);
see also, e.g.,
(same).
2. Breach of Oral Contract Claim
SLT raises several arguments as to why it is entitled to summary judgment on ARI’s breach of oral contract claim. SLT relies, first,
on the statute of frauds. Contracts for the sale of goods over $500 generally must be in writing and must be signed by the party
against whom enforcement is sought. ; . Because the NYCDOE contract undisputedly involved the sale of goods in excess of
$500, the parties’ oral contract that ARI would be the exclusive supplier of kiosks for the project is not enforceable in the absence
for 1,500 kiosks for the NYCDOE project. The only statute of frauds exception ARI has invoked is . The non-pilot program kiosks
do not fall within the ambit of because those goods were not received and accepted, nor was payment made and accepted for
them. ARI has not directed the court’s attention to any other evidence which demonstrates a genuine issue of material fact with
respect to any other statute of frauds exception. Accordingly, the court’s analysis of ARI’s breach of oral contract claim is narrowed
to the goods ARI supplied for SLT’s pilot project with the NYCDOE, as the remaining aspect of that claim is barred by the statute of
*8 The court also rejects SLT’s argument that ARI has not cited factual support proving SLT’s breach of the putative promise.
Viewing the evidence in the light most favor to ARI, as of course the court must at this procedural juncture, the record contains
genuine issues of material fact regarding the extent to which SLT breached its oral contract with ARI.
SLT’s argument that ARI must rely on the future adjudication of the separate lawsuit in California to prove the counterclaims
asserted in this matter is also without merit. SLT’s argument on this issue is based on a statement in the Pretrial Order in which
issues bear on the claims involved in this case. The claims involved in this lawsuit arise from SLT’s alleged promise to use ARI as
the exclusive supplier of kiosks on the NYCDOE project. Because they do not arise from the Non-Disclosure and Confidentiality
Agreement, then, they are not subject to the California forum selection clause. ARI is not at this time seeking a judgment on any of
its counterclaims in this case which would depend on resolution of ARI’s claims in the California lawsuit. Thus, the court sees no
reason why ARI would need to await adjudication of its claims in the California lawsuit before litigating any and all issues relevant
to its counterclaims in this case. In sum, SLT has not presented any argument which persuades the court that SLT is entitled to
judgment as a matter of law on ARI’s claims in this lawsuit simply because some of the issues involved in resolving those claims
might also be involved in the pending California case.
3. Promissory Estoppel Claim
*9 Promissory estoppel is a doctrine by which courts view performance in reasonable reliance on a promise as sufficient to create
a legally binding contract where a contract otherwise lacks consideration. . Kansas courts apply the rule on promissory estoppel
set forth in the .
see also
. Under that rule, “[a] promise which the promisor should reasonably expect to induce action or
forbearance on the part of the promisee … and which does induce such action or forbearance is binding if injustice can be avoided
involving the statute of frauds the promisee must first show by competent evidence that a valid and otherwise enforceable contract
was entered into by the parties, meaning the agreement must contain all material elements of a contract, ;
see also
. The
promisee must also show that the facts of the case justify application of the doctrine, and promissory estoppel should be applied
only if a refusal to enforce the promise would be virtually to sanction the perpetration of fraud or would result in other injustice.
Thus, the doctrine of promissory estoppel may be applied to cases where the statute of frauds would otherwise apply as a defense.
purchase order. Simply put, SLT’s relatively perfunctory one paragraph argument on this element does not even begin to address
the issue of reasonable reliance under the facts of this case with the level of detail necessary for SLT to meet its burden of
demonstrating it is entitled to summary judgment on this counterclaim.
294 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
SLT’s argument that its alleged commitment to purchase exclusively from ARI is too indefinite to constitute an enforceable contract
characterization of the evidence at this procedural juncture. Viewing the summary judgment record in the light most favorable to
ARI, it appears that SLT used ARI to obtain the contract with NYCDOE, that SLT could not have fulfilled one of the mandatory
requirements of the RFP (prepayment kiosks) without ARI’s assistance, that SLT stole ARI’s confidential information in an effort to
design and build its own kiosks so that it could cut SLT out of the NYCDOE deal, that SLT intended to do so all along, that SLT did
not negotiate in good faith to reach a written contract with ARI, and that SLT reneged on its promise to use ARI as the exclusive
supplier for the NYCDOE project for no apparent reason. Certainly, a rational trier of fact could conclude that not enforcing SLT’s
promise to use ARI as the exclusive supplier on the NYCDOE project would essentially sanction the perpetration of fraud or result
in injustice. Accordingly, SLT’s motion for summary judgment on this claim is denied.
4. Unjust Enrichment Claim
*11 The basic elements of an unjust enrichment claim under Kansas law are
(1) a benefit conferred upon the defendant by the plaintiff; (2) an appreciation or knowledge of the benefit by the defendant; and (3)
the acceptance or retention by the defendant of the benefit under such circumstances as to make it inequitable for the defendant to
retain the benefit without payment of its value.
. SLT argues that it is entitled to summary judgment on ARI’s unjust enrichment claim because SLT did not accept any benefit in its
5. Fraud
SLT argues that it is entitled to summary judgment on its fraud claim because plaintiff has failed to prove a present intent to
defraud. Again, viewing the evidence in the light most favorable to ARI, the court disagrees. ARI has submitted deposition
testimony from SLT’s then-national account manager, Ms. Noyes, who worked on SLT’s response to the NYCDOE RFP. A rational
trier of fact could conclude based on the summary judgment record that SLT used ARI to respond to the NYCDOE RFP and for the
1. SLT’s Breach of Contract Claim
It is uncontroverted that SLT contracted with ARI for the production and delivery of kiosks and personal access devices (PADs),
that SLT paid in advance for those goods, that ARI refused to deliver some of the purchased product to SLT as contracted, and
that ARI has retained and refused to return over $55,000 from SLT’s pre-payment for goods which ARI refused to supply. ARI
nonetheless contends that SLT is not entitled to summary judgment because SLT’s material breach (in failing to honor its
goods.
See
2 Lawrence,
supra,
§ 2-201:281, at 465 (exception for goods received and accepted only avoids the statute of frauds
with respect to those goods; it does not make the entire oral contract enforceable as to the undelivered goods).
Consequently, ARI cannot use the alleged contract with respect to the non-pilot program goods as a defense.
See
(stating “a
contract for the sale of goods for the price of $500 or more is not enforceable by way of action
or defense
” (emphasis added)).
Thus, ARI’s argument that its performance is excused with respect to the non-NYCDOE goods must rest, if at all, on SLT’s alleged
case law thereunder. At this procedural juncture, SLT has not established that delivery of the two sets of goods was necessarily
unrelated or that ARI is not entitled to relief under and, therefore, it has not established that it is entitled to summary judgment on
this basis.
ARI also contends that SLT cannot enforce the contracts for the sale of non-NYCDOE purchases because ARI was fraudulently
induced to enter into those contracts. Certainly, it is well established that a contract is voidable if it was induced by fraud. ; . Here,
the court has already explained (with respect to ARI’s affirmative fraud counterclaim) that a rational trier of fact could find based on
2. SLT’s Breach of Warranty Claim
*14 The clerk entered default on SLT’s breach of warranty claim (doc. # 92) on December 21, 2006. On January 4, 2007, ARI filed
a Motion to Set Aside the Clerk’s Entry of Default (doc. # 94). The court may set aside an entry of default for “good cause shown.” .
The principal factors the court considers in determining whether a defendant has met this good cause standard are (1) whether the
default was the result of culpable conduct of the defendant, (2) whether the plaintiff would be prejudiced if the default should be set
damages on its breach of warranty claim in any event. It appears to the court that SLT would not need to conduct much more
discovery on this claim to prove liability than it would need to prove damages, and that this proof will probably lie largely in the
hands of SLT, not ARI. The trial of this case is still some two months off. If SLT truly needs to pursue discovery, the parties may
agree to reopen discovery on this claim.
See
Pretrial Order (doc. # 91), ¶ 13, at 14. If they are unable to reach such an agreement,
SLT can file a motion for leave to reopen and expedite discovery on this claim. The court would be inclined to grant any such
material fact precluding summary judgment on SLT’s breach of warranty claim.
MOTION TO STRIKE JURY DEMAND
Finally, the court turns to Plaintiff’s Motion to Strike Defendant’s Untimely Jury Demand (doc. # 77). It is undisputed that ARI did not
make a timely demand for a jury trial of the claims in this case and thereby waived its right to a jury trial.
See
; . Although the court
has discretion to order a jury trial later upon motion by a party,
see
, ARI did not file any motion pursuant to . Instead, ARI simply
(holding it is not an abuse of the court’s discretion to deny a motion where the party seeking a jury trial offers no excuse for an
untimely request made more than a year and a half after the original complaint was filed).
CHAPTER 15: THE STATUTE OF FRAUDS—WRITING REQUIREMENT 297
*16 In addition, the court believes that this case, in particular, is far better suited to a trial to the court than it is to a jury trial. This is
not a negligence case or an employment discrimination case where the jury can be fairly easily tasked with its role as the finder of
73) is granted in part and denied in part as set forth above.
IT IS FURTHER ORDERED THAT SLT’s Motion for Partial Summary Judgment on Its Breach of Contract Claims (doc. # 75) is
denied.
IT IS FURTHER ORDERED THAT ARI’s Motion to Set Aside the Clerk’s Entry of Default (doc. # 94) is granted.
IT IS FURTHER ORDERED THAT SLT’s Motion to Strike Defendant’s Untimely Jury Demand (doc. # 77) is granted.
Case 15.3
La.App. 3 Cir.,2010.
Watkins v. Schexnider
31 So.3d 609, 2009-744 (La.App. 3 Cir. 2/10/10)
Court of Appeal of Louisiana,
298 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
ISSUES
Watkins assigns as error:
1. The trial court’s failure to consider parol evidence to determine the true object of the buy sell agreement and to enforce the
agreement.
2. 2Alternatively, the trial court erred in failing to find Schexnider liable for fraud and misrepresentation which vitiated consent
and supports rescission of the entire contract.
3. The trial court erred in failing to award her reasonable damages and attorney fees.
DISCUSSION
The contract entered into between Watkins, as the buyer, and Schexnider, as the seller, states:
Home Purchase Agreement
I Sandra Schednider [sic] agree to let Pam Raffield live in my house at 141 Welch Drive, Hackberry, Louisiana. Pam Raffield
court further found that, pursuant to the contract, once the mortgage was satisfied by the insurance proceeds, Watkins was no
longer under any obligation to continue paying the monthly $350 note. Thus, it refunded her $4,200.
PAROL EVIDENCE
[1][2] Louisiana Civil Code Article 1848 states:
Testimonial or other evidence may not be admitted to negate or vary the contents of an authentic act or an act under private
agreement and by giving consideration on a practical basis to the instrument in its entirety.” When the words of a contract are
clear, explicit, and lead to no absurd consequences, the contract must be interpreted within its four corners and cannot be
explained or contradicted by parol evidence. However, when a word in a contract is not clear, testimony or other evidence may
be considered to determine the parties’ intent and interpret the contract…. [This] rule applies to contacts involving immovable
property.
conclusion that the mutual or common intent of the parties to the writing was to deal with the particular property and not another
property of the same kind or quantity.”
Id.
[5] There is no doubt that the particular property in question is located at the municipal address of 141 Welch Drive in Hackberry,
Louisiana. However, the “Home Purchase Agreement” is ambiguous as to the parties’ intent regarding the underlying land on
which the home sits.
provision in the contract, can only be interpreted as ambiguous. It seems clear that if a party intends to sell only a house and not
the land on which it sits, she would so note and provide for the details of the manner in which the underlying land is to be used.
Otherwise, the home buyer is left in a quandary of having no idea what the terms of the land rental agreement is, such as when it
begins, the cost, the limitations on the land, and various other matters pertaining to use of another person’s land. This situation
surely leads to absurd consequences as it leaves a buyer susceptible to the landowner‘s whim and further leads to instability of
transactions involving immovables.
FN1. We note that the house/home in question is not a mobile home.
Accordingly, we find that parol evidence should have been allowed to determine the true intent of the parties regarding the
underlying land. We now consider the evidence adduced at trial.
[6] Watkins testified that, as of the time of trial, she had resided in the home for eight years. Watkins testified that Schexnider
always indicated that the sale included the house, its contents, and the land. The house itself was very modest and in need of
admitted into evidence.
Schexnider testified that she offered Watkins a rent-to-own arrangement. She admitted that the showed her the boundaries of the
property line. She further admitted that she did not think that she ever conveyed to Watkins that the land did not go with the house.
She admitted that she never told Watkins that she would be able to charge her rent for the land once Watkins owned the house.
She admitted to drafting the rent-to-own contract. Schexnider testified that she did not mean to fool Watkins but admitted to not
Marla Raffield, Watkins’ daughter-in-law, testified that she was present the day that Schexnider pointed out the whole property line.
Raffield said that Schexnider indicated a survey would be done once the land was paid for so that Watkins could “verify her land
with the court.” Raffield said that Schexnider never indicated that she was only selling the house.
Having reviewed all of the evidence, we are certain that, at the time Watkins and Schexnider confected the “Home Purchase
Agreement” the land was included as part of the sale. Schexnider’s own testimony that the she never informed Watkins that the
to award Watkins’ claims for attorneys fees and damages.
CONCLUSION
We render judgment in favor of the Plaintiff-Appellant, Pamela Raffield Watkins and order specific performance in that title to the
aforementioned property, including the land and buildings thereon, be conveyed to Watkins. We affirm that portion of the trial
court’s judgment awarding Watkins $4,200 for overpayments. All costs of this appeal are assessed against the Defendant–