Johnston v. Curtis

70 Ark. App. 195, 16 S.W.3d 283 (2000)

 

RULE:

In order to remove an oral agreement from the statute of frauds, it is necessary to prove both the making of the oral agreement and its part performance by clear and convincing evidence. A requirement that the evidence be clear and convincing does not mean that the evidence be uncontradicted. Partial performance of a contract by payment of a part of the purchase price and placing a buyer in possession of land pursuant to an agreement of sale and purchase is sufficient to take the contract out of the statute of frauds.

FACTS:

Appellants entered into a written contract to purchase appellees' house for $ 114,000. Because the house was appraised at only $ 110,000, the parties orally agreed to a purchase price of $ 110,000. Appellants paid appellees the amount of $ 500 so they could move-in. But afterwards, the appellants refused to close because of the mortgage terms. Appellees sold the house to another for $ 100,000. The trial court held appellants breached the contract and awarded appellees $ 10,000, which represented the difference between the written and orally modified contract price. Appellants contend that the oral modification was barred by the statute of frauds.

ISSUE:

Is the oral modification unenforceable under the statute of frauds?

ANSWER:

No.

CONCLUSION:

The court held that the parties orally modified the written contract because they admitted to changing the purchase price. The oral modification was not barred by the statute of frauds because appellants took possession and paid appellees $ 500. The contract was not subject to conditions precedent because the original contract only stated that appellants would obtain a loan for $ 102,600, which they did, and made no mention of the amount of closing costs. Appellees were only entitled to $ 10,000 in damages.

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