Dehahn v. Innes

Decision Date22 April 1976
Citation356 A.2d 711
Parties19 UCC Rep.Serv. 407 Everett D. DEHAHN v. Richard A. INNES.
CourtMaine Supreme Court

Rocheleau & Fournier, P. A., by Paul C. Fournier, Lewiston, for plaintiff.

Thomas F. Kinnelly, III, Raymond, for defendant.


DUFRESNE, Chief Justice.

The defendant, Richard A. Innes, appeals from a judgment in favor of the plaintiff, Everett D. Dehahn, in the amount of $8,800.00 arising out of a civil complaint for breach of contract. The case was heard by a single Justice of the Superior Court (Kennebec County) jury-waived. We sustain the appeal on the issue of damages only.

The facts giving rise to the complaint may be summarized as follows:

Until March, 1972 Mr. Dehahn was road commissioner for the Town of Wayne. In his work for the town he used, for the most part, his own thevy equipment and was compensated for his services at an hourly rate. Failing reelection at the annual town meeting in 1972, the plaintiff sought to interest the defendant and one King to purchase his business, including incidental goodwill, for the price of $60,000.00.

After Mr. King withdrew from the negotiations, the plaintiff and the defendant further explored the possibilities of reaching an agreement of purchase and sale, which they did at the end of April. By oral contract, so the presiding Justice found, Dehahn agreed to sell and Innes agreed to buy for the price of $35,000.00 the plaintiff's 52 acre gravel pit, a back hoe, a bulldozer, a loader, a dump truck with plow, another truck with plow and a home-made low bed trailer. The Justice found that the parties had receded from the original intent to sell and buy the business as such.

The plaintiff had agreed to deliver the equipment in a 'ready-to-go condition.' In compliance with this part of the agreement the plaintiff sent his employee Riggs to do the job which needed to be done such as the removal of the plows from the trucks, plus such other maintenance work as was necessary. Most of the plaintiff's equipment, with the defendant's consent, had already been moved by the plaintiff to the defendant's field across from the driveway to his home, with the keys to the equipment left in the machines. It is conceded that Mr. Riggs did work on the equipment, with the assistance of the defendant Innes, for somewhat less than a full day.

There was evidence that Innes did use the bulldozer on a job prior to his rescission of the agreement. Whether this use was at the request and for the benefit of the plaintiff or as part of the defendant's new business undertaking was a matter for the presiding Justice to settle as a question of fact on disputed testimony.

After numerous complaints about the plaintiff's failure to put the equipment in a 'ready-to-go condition,' the defendant informed the plaintiff that he was cancelling the agreement and no payments were ever made pursuant to the contract.

The issues raised for our consideration concern 1) the applicablility of the statute of frauds to the oral transaction, 2) whether the defendant's conduct amounted to a breach of the agreement and 3) the propriety of the amount of damages awarded by the presiding Justice.

I. The Statute of Frauds

The contract between the parties was not in writing. The defendant contends it is unenforceable for that reason. Our statutes in pertinent part provide as follows:

'No action shall be maintained in any of the following cases:

4. Upon any contract for the sale of lands, tenements of hereditaments, or of any interest in or concerning them;

unless the promise, contract or agreement on which such action is brought, or some memorandum or note thereof, is in writing and signed by the party to be charged therewith, or by some person thereunto lawfully authorized; . . ..' 33 M.R.S.A., § 51.

'Except as otherwise provided in this section, a contract for the sale of goods for the price of $500 or more is not enforceable by way of action of defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or his authorized agent or broker. . . .' 11 M.R.S.A., § 2-201(1).

Furthermore, viewing the agreement between the parties as an 'entire' contract, the defendant, relying on Brown v. True, 1923, 123 Me. 288, 122 A. 850, asserts that, if the contract is entire and part is within the statute, it is unenforceable as a whole, and no action can be maintained to enforce the part which would not have been affected by the statute if it had been separate and distinct from the other part. Id. 290, 122 A. 850.

The defendant's contention is correct that we must view the oral agreement between the parties as an 'entire' contract having dual aspects, 1) the sale and purchase of land and 2) a bargain respecting personal property.

The fixing of unit prices to ascertain the overall single price of the contract as a whole would not be conclusive of severability of the contract. Levine v. Reynolds, 1947, 143 Me. 15, 21, 54 A.2d 514.

The true test is whether the parties assented to all the promises as a single whole, so that there would have been no bargain whatever if any promise or set of promises were struck out. Brown v. True, supra, 123 Me. at page 290, 122 A. 850.

Thus, the severability or entirety of a contract depends upon the intent of the contracting parties and in the case of an oral contract is a question of fact for the fact-finder. Levine v. Reynolds, supra, 143 Me. at page 21, 52 A.2d 514.

It is the duty of the fact-finder to determine the existence of the parol contract, its extent and limitations, in other words, to find not only what language was used, but its purport and meaning. Herbert v. Ford, 1851, 33 Me. 90, 93.

Although the Justice below made no specific finding of fact in relation to the severability or entirety of the verbal contract, it is clear from his decision that he treated the same as an 'entire' contract. The record supports such a decision, since the negotiations were carried on in terms of a total price and unit prices were introduced into evidence only in proof of damages on resale. We cannot say that the Justice below was clearly wrong in such preliminary underlying implied finding of fact involved in his sltimate finding favorable to the plaintiff. See Jacobs v. Boomer, 1970, Me., 267 A.2d 376; Blue Rock Industries v. Raymond International, Inc., 1974, Me.,325 A.2d 66.

Findings of fact, whether express or implied, shall not be set aside unless clearly erroneous. Gay v. Gay's Super Markets, Inc., 1975, Me., 343 A.2d 577; Cobb v. Cougle, 1976, Me. 351 A.2d 110.

Had the parties in their verbal contract dealt solely with the sale and purchase of 'goods' within the meaning of the Uniform Commercial Code, the contract would be legally enforceable notwithstanding the express requirements of the statute of frauds contained in 11 M.R.S.A., § 2-201(1).

The Code provides the following exception:

11 M.R.S.A., § 2-201(3)

'A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable

'(b) If the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted; * * *.'

By this change in the statute of frauds, the Legislature had in mind to expand the exceptions to the statutory rule of nonenforceability concerning oral agreements relating to the sale of goods. Although limited in scope, this provision of the Code was intended to deny the benefit of the statute of frauds to one who in court, whether by pleading, testimony or otherwise, admits the existence of the oral contract sued upon. The ultimate design of this legislation is to limit the use of the statute of frauds as a shield against unfounded fraudulent claims resting in parol, while removing from the arsenal of an unscrupulous litigant an unrighteous defense against a just claim. See Garrison v. Piatt, 1966, 113 Ga.App. 94, 147 S.E. 2d 374.

Since part of the consideration for the price in the instant oral agreement consisted of real estate, we must have in mind the provisions of 11 M.R.S.A., § 2-304(2), which state:

'Even though all or part of the price is payable in an interest in realty, the transfer of the goods and the seller's obligations with reference to them are subject to this Article, but not the transfer of the interest in realty or the transferor's obligations in connection therewith.'

From a reading of subsection (2) of section 2-304 and the comments of the drafters of the Code, it is apparent that the Code is concerned only with the transfer of title to goods and not with the transfer of title to realty which must be left 'to the courts and other legislation.'

As stated in the Uniform Commercial Code Comment (11 M.R.S.A., Vol. 4, at page 108):

'However, the complexities of these situations may be such that each must be analyzed in the light of the underlying reasons in order to determine the applicable principles. Local statutes dealing with realty are not to be lightly disregarded or altered by language of this Article. In contrast, this Article declares definite policies in regard to certain matters legitimately within its scope though concerned with real property situations, and in those instances the provisions of this Article control.'

The issue before us is, whether the instant 'entire' contract resting in parol is unenforceable where part thereof involves real estate and, thus, brings it within the scope of the statute of frauds (33 M.R.S.A., § 51(4)) relating to 'the sale of lands, tenements or hereditaments, or of any interest in or concerning them.'

Our Court has stated that the object of statutes of fraud is 'to prevent perjury and fraud.' Such statutes affect the remedy...

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