Doss & Harper Stone v. Hoover Bros. Farms, 27006.

• Decision Date: 31 March 2006
• Docket Number: No. 27006.,27006.
• Citation: 191 S.W.3d 59
• Parties: DOSS & HARPER STONE CO., INC., Plaintiff-Respondent, v. HOOVER BROTHERS FARMS, INC., Defendant-Appellant.
• Court: Missouri Court of Appeals

191 S.W.3d 59

DOSS & HARPER STONE CO., INC., Plaintiff-Respondent, v. HOOVER BROTHERS FARMS, INC., Defendant-Appellant.

No. 27006.

Missouri Court of Appeals, Southern District, Division Two.

March 31, 2006.

Michael C. Phillips, Blackwell Sanders Peper Martin, LLP, Kansas City, for appellant.

Kenneth A. Wagoner, Brill, Moore & Wagoner, P.C., West Plains, for respondent.

KENNETH W. SHRUM, Presiding Judge.

The mining lease at issue here was drafted by a person with rock quarry and mining experience but no apparent legal training. The document typifies why the public needs greater protection from the unauthorized practice of law by lay persons, whether by non-lawyer title company employees, on-line non-lawyer purveyors of legal documents, or others (as occurred here).

Soon after the subject lease was signed, one party thereto (the "Quarry") wanted out.¹ Accordingly, it sued "Landowner" claiming, inter alia, that the contract was unenforceable because it violated the statute of frauds and the rule against perpetuities. The trial court agreed and sustained Quarry's motion for summary judgment on both grounds. It also denied Landowner's motion for a partial summary judgment. Landowner appeals. This court affirms.²

The Quarry owns an eighty-acre tract of land near West Plains, Missouri, on which it operates a rock and limestone quarry. It also conducts quarry operations on leased land.

Landowner holds title to twenty tracts of land in Howell County, Missouri, comprising some six thousand acres. It owns additional real estate in other Missouri counties and in other states. Some of these tracts are farm land and others are commercial and residential property.

James Winnick ("Winnick") had worked extensively in the mining and explosive's industry, although he did not have a mining or engineering degree. As a consultant for Quarry, Winnick was privy to and participated in negotiations between Quarry's and Landowner's representatives regarding a reciprocal lease of the parties' respective properties. Winnick's knowledge of those negotiations ultimately led him to prepare the subject lease. The lease was signed by officers of the respective parties on July 20, 2000.

The lease document provided, inter alia, that Landowner was leasing to Quarry the "exclusive mining rights on all properties presently owned and properties acquired during the term of the lease." The lease term was for "an infinite period of time." Among other things, Landowner was to receive (a) ".20 cents per tone [sic] for all stone mined" on its properties, and (b) lease rights to "undeveloped underground space . . . created by mining out the 80 acres owned by [Quarry]." Another relevant contract provision recited this:

"2.(G) [Quarry] agrees to first mine the approx. 1,000 acres adjacent to the existing quarry which is in the north and south side of Quarry Road. It is understood that certain portions of this property may be excluded from mining by [Landowner], i.e. areas close to existing homes, and other business buildings which may suffer damage due to the mining operation." (Emphasis added.)

Quarry sued Landowner on July 12, 2002, alleging in Count I that the lease contract was unenforceable. After discovery was completed, Quarry moved for summary judgment on Count I. The trial court sustained that motion, concluding the lease was void because it violated the statute of frauds and the rule against perpetuities. Landowner's appeal followed.

STANDARD OF REVIEW

Our review here is essentially de novo as the propriety of the court's sustention of Quarry's motion for summary judgment is purely an issue of law founded solely upon the record submitted and the applicable law. ITT Commercial Finance v. Mid-Am. Marine, 854 S.W.2d 371, 376[6] (Mo.banc 1993). Stated otherwise, the key to a sustainable summary judgment is a showing by the prevailing party that he or she has an undisputed right to a judgment as a matter of law. Id., at 380[11].

DISCUSSION AND DECISION

Landowner's first point charges the trial court erred when it found the mining lease invalid based on an alleged violation of the statute of frauds. Landowner concedes the questioned document had to comply with the statute of frauds, but insists compliance was shown in that the lease "contains an adequate description of the land to be leased which can be made perfect and certain by parol evidence."

In relevant part, the statute of frauds provides "[n]o action shall be brought . . . upon any . . . lease [of lands] for a longer time than one year . . . unless the agreement upon which the action shall be brought, or some memorandum or note thereof, shall be in writing and signed by the party to be charged therewith." § 432.010, RSMo 2000. Whether a writing satisfies the statute of frauds is a question of law. Johnson v. Cook, 167 S.W.3d 258, 262[6] (Mo.App.2005); Ahrens v. Dodd, 863 S.W.2d 611, 613 (Mo.App.1992). If a writing clearly fails to satisfy the statute of frauds, the party invoking the statute is ordinarily entitled to summary judgment.³ Arnold v. Broadmoor Dev. Co., 585 S.W.2d 564, 565 (Mo.App.1979); Smith v. Int'l Paper Co., 87 F.3d 245, 247 (8th Cir.1996) (applying Missouri law).

To satisfy the statute of frauds a writing must contain the essential terms of a contract. Johnson, 167 S.W.3d at 262[7]. The "essential terms" are the parties, the subject matter, the price, the consideration, and the promises on both sides. Id. It has been said that the subject matter, i.e., the property conveyed or leased, is the most "essential part" of the contract. Huttig v. Brennan, 328 Mo. 471, 41 S.W.2d 1054, 1062 (1931). Thus, it is well-settled law that the writing must describe the land being sold or leased. 72 AM JUR 2d Statute of Frauds, § 240 at 746 (2001).

As to particularity or degree of certainty of the land description, the general rule has long been that "[t]he land need not be fully and actually described in the paper so as to be identified from a mere reading of the paper. But the writing must afford the means whereby the identification may be made perfect and certain by parol evidence." Black v. Crowther, 74 Mo.App. 480, 483 (1898). See also Herzog v. Ross, 355 Mo. 406, [1] 196 S.W.2d 268, 270 (banc 1946). "The writing must be a guide to find the land and must contain sufficient particulars to point out and distinguish the tract from any other." Fox v. Courtney, 111 Mo. 147, 20 S.W. 20, 21 (1892).⁴

Accordingly, a court will not enforce a contract for the sale or long term lease of real estate unless the contract or a written memorandum thereof either definitely describes the land or clearly provides, within itself, the "means" or "key" by which the land can be identified with reasonable certainty. Macy v. Day, 346 S.W.2d 555, 559 (Mo.App.1961); 72 AM JUR, § 241 at 747. See generally, Annotation: Sufficiency of Description or Designation of Land in Contract or Memorandum of Sale, Under Statute of Frauds, 23 A.L.R.2d 6, § 2 (1952 and Later Case Service).

In a strikingly similar expression of these principles, the Supreme Court of Missouri has declared:

"The law does not require that a contract for the sale of land shall in itself be wholly sufficient to identify the property. The writing is sufficient if it clearly reveals the intent of the parties with reference to the particular tract which is the subject matter of the sale and furnishes the means of its identification; or, as some cases hold, if it provides the `key' to the identification—the applicable principle being that that is certain which can be made certain."

Ray v. Wooster, 270 S.W.2d 743, 749[1] (Mo.1954). The Wooster court also noted that the "key" or "means" within the writing must be a reference "to external standards in existence at the time and capable of being determined beyond dispute." Id. at 749 (emphasis added). See also Rone v. Reeves, 20 S.W.3d 526, 529 (Mo.App.2000) (affirming trial court ruling that a contract was not legally enforceable under the statute of frauds because "[t]he contract on its face neither sufficiently provides the means for determining . . . the land to be conveyed nor on its face refers to then-existing external evidence which might be utilized in determining the parties' intention and applying the description contained within the contract.")

Any consideration of the "key or means" rule necessarily requires application of another well-established rule, namely that parol evidence is only admissible to apply, not to supply, a description of land in a writing. Shy v. Lewis, 321 Mo. 688, 12 S.W.2d 719, 721 (1928). As the Shy court explained, the description in a writing "must be sufficiently definite to identify the land by its own terms or by reference in it to external standards in existence at the time of the making of the contract and capable of being determined beyond dispute." Id. at 721[2]. When the land description in the writing is insufficient, "oral evidence is not admissible in aid of the memorandum, because the court will never receive such evidence both to describe the land and then to apply the description." Id. at 721[3].

Applying these principles to this case, the alleged lease fails to satisfy the statute of frauds. This is at once apparent upon reading part of subparagraph (G) of paragraph 2, to wit:

"It is understood that certain portions of this property may be excluded from mining by [Landowner], i.e. areas close to existing homes, and other business buildings which may suffer damage due to the mining operation." (Emphasis added.)

Standing alone, inclusion of the italicized clause was fatal to the subject lease. This is so because neither this clause nor any other lease language affords a means whereby identification of the land being leased can be made perfect and certain by parol evidence. Where are the "key[s] or means" within the writing by which the excluded land can be quantified and identified? Where does the writing reference an external...