Buffaloe v. Hart

North Carolina Court of Appeals · Contracts

ContractsStatute of FraudsSale of GoodsUCC 2-201oral contracttobacco barnsgoodscheck as writing

Facts

Plaintiff, a tobacco farmer, orally agreed with defendants to buy five tobacco barns for $20,000, payable in four annual installments of $5,000, after previously renting the barns from them. Plaintiff remained in possession of the barns, reimbursed defendants for 1989 insurance, paid for repairs, attempted to resell the barns, and received deposits from prospective buyers. He later delivered a personal check for the first $5,000 payment to Patricia Hart, with notation that it was for the five barns, but defendants later returned the torn-up check and refused to complete the sale. A jury found that a contract existed, that plaintiff accepted the barns, that defendants accepted payment, and that defendants breached.

Issue

Whether plaintiff’s personal check satisfied UCC § 2-201(1) as a sufficient writing signed by the party against whom enforcement was sought, and, if not, whether there was substantial evidence that plaintiff accepted the barns and defendants accepted partial payment so that the oral contract was enforceable under UCC § 2-201(3)(c).

Rule

For a sale of goods priced at $500 or more, a writing satisfies UCC § 2-201(1) only if it indicates a contract for sale, is signed by the party against whom enforcement is sought or that party’s authorized agent, and states a quantity. Even without such a writing, an otherwise valid oral contract is enforceable under UCC § 2-201(3)(c) with respect to goods for which payment has been made and accepted or which have been received and accepted. Acceptance may be inferred from conduct, and whether payment or goods were accepted under § 2-201(3)(c) is a question of fact for the jury.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Asheville, Nora Phelps orally agreed to buy 12 used metal grain bins from Dale Mercer for $18,000. Nora later mailed Dale a personal check for $4,500 with the memo line reading "1st payment for 12 grain bins," but Dale never endorsed or signed the check and sent it back two days later.

If Nora sues Dale to enforce the oral contract based only on the check as the required writing, which is the strongest argument?

Explanation. For goods priced at $500 or more, a writing satisfies UCC 2-201(1) only if it indicates a contract for sale, states a quantity, and is signed by the party against whom enforcement is sought or that party’s authorized agent. A buyer’s personal check may qualify only if the seller has signed or endorsed it. Here, the only writing was signed by Nora, not Dale, so it does not satisfy subsection (1).