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DePugh v. Mead Corp. - 79 Ohio App. 3d 503, 607 N.E.2d 867 (1992)

Rule:

Pursuant to Ohio Rev. Code § 1302.03(A), a contract for the sale of minerals or the like, including oil and gas, or a structure or its materials to be removed from realty is a contract for the sale of goods within Ohio's codification of the Uniform Commercial Code if they are to be severed by the seller. Conversely, if the buyer is to sever, such transactions are considered contracts affecting land and all problems of the Statute of Frauds apply to them. The sale of several feet of clay soil to be removed by the buyer and which could only be reached by removing several feet of topsoil is not the sale of goods within the Uniform Commercial Code and, thus, the contract must satisfy the Statute of Frauds.

Facts:

Mead Corporation contracted with the landowner wherein the landowner granted Mead a license to excavate and purchase clay. Mead agreed to restore the property and construct a lake. The landowner incurred expenses and alleged that the Mead Corporation failed to comply with any part of the contract. The trial court held that the contract was unenforceable because it was not in writing and in violation of the statute of frauds, Ohio Rev. Code § 1335.05. The clay was to be severed from the landowner's property by Mead Corporation and the removal necessitated the initial removal of topsoil. Therefore, the alleged agreement did not constitute the sale of Mead’s representative signed a letter which recognized the existence of an oral agreement.

Issue:

Was the agreement between the parties unenforceable for violating the Statute of Frauds?

Answer:

Yes.

Conclusion:

On review, the state appellate court held that the parties' alleged oral contract was indivisible and completely unenforceable pursuant to § 1335.05. The court also held that the letter from the corporation's manager, which referred to the agreement, could not be construed to establish that an agreement had been reached because it did not state the agreement's essential terms.

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