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The exception to the statute of frauds contained in Kan. Stat. Ann. § 84-2-201(3)(b) is satisfied when the party who has denied the existence of an oral contract in reliance on the statute takes the stand and, without admitting explicitly that a contract was made, testifies as to his statements or his actions which establish the terms of the oral contract claimed by the opposing party. It is not necessary that there be an express declaration in which the party admits the making of the oral contract. It is sufficient if his words or admitted conduct reasonably lead to that conclusion.
Conagra, Inc., a wheat dealer, brought suit against the defendant Nierenbergs claiming that their oral agreement entitled it to recover $ 14,125 in expectation damages after the Nierenbergs failed to sell their wheat as promised. Conagra contended that it routinely made oral agreements over the phone, setting price and amount of wheat sales with area farmers. The Nierenbergs maintained that in his conversation with Conagra he was only checking the market price that day. The trial court entered judgment for the Nierenberg, finding that Conagra failed to establish that an enforceable oral agreement existed.
Did Dennis Nierenberg’s testimony sufficiently admit that a contract of sale was verbally made, thereby exempting it from the statute of frauds?
Dennis clearly testified to the fact that he placed the call to ConAgra on April 9, 1996, with the intent to sell his grain, and that he and Raba discussed the terms of such a sale. He effectively admitted the fact that he offered to sell 12,500 bushels of wheat, and that ConAgra, through its agent, Raba, agreed to pay him $ 5.01 per bushel for the wheat. Yet, his testimony was not necessarily "deliberate" as was the case in Farmers Elevator; rather, Dennis was responding to carefully worded questions posed by opposing counsel, including numerous references to the "contract." Such responses, in turn, served to weave together a legal conclusion that Dennis in fact sold the grain, rather than engaged in preliminary negotiations demonstrating a mere willingness to sell. Further, Dennis also testified to the fact that after discussing the terms of the sale, he instructed Raba to write up a contract for his signature. He also testified to the fact that he always signed a contract when selling grain to ConAgra, which comports with an essential fact embraced by his defense: that a signed writing is required for the sale of grain, and that no oral agreement was binding until it was reduced to writing and signed by him. In this sense, he did not definitively testify to the fact that his ordinary dealings with ConAgra--or other grain elevators for that matter--usually or always involved oral contracts not requiring a signed writing by him. His testimony indicates that, in fact, most all of the Nierenbergs' grain sales involved Dennis signing a contract shortly after oral discussion with the elevator. Thus, Dennis's own testimony served to explain the fact that even if an oral sales agreement was made by phone on April 9, 1996, the parties agreed that a contract would be drafted which Dennis would later sign. Accordingly, such an apparent contradiction to an outright admission that he was orally bound to sell grain on April 9, 1996, must be viewed in his favor. Finally, Dennis provided several statements of fact regarding his conduct following the phone call. Primarily, ConAgra looks to the fact provided in Dennis's testimony that once he received the confirmation contract, and visited the elevator, he did not inform Raba, on April 19, 1996, that a contract had not been formed. Yet, the fact that Dennis was willing to further negotiate the quantity--10,000 bushels rather than the discussed 12,500 bushels--is not necessarily the objective conduct of person who is contractually bound without a signed writing. On the whole, the testimonial facts provided by Dennis concerning his post-phone conversation conduct are, as the District Court concluded, ambiguous.