Norton v. Hindsley

• Decision Date: 13 January 1969
• Docket Number: No. 5--4658,5--4658
• Citation: 435 S.W.2d 788,245 Ark. 966
• Parties: Mary G. NORTON, Appellant, v. Roy HINDSLEY, Appellee.
• Court: Arkansas Supreme Court

Page 788

435 S.W.2d 788

245 Ark. 966

Mary G. NORTON, Appellant, v. Roy HINDSLEY, Appellee.

No. 5--4658.

Supreme Court of Arkansas.

Jan. 13, 1969.

David Solomon, and W. G. Dinning, Jr., Helena, for appellant.

John L. Anderson, Helena, for appellee.

FOGLEMAN, Justice.

On rehearing, the opinions delivered in this case on October 7, 1968, are withdrawn, and the following opinion is substituted therefor:

The first question to be determined on this appeal is whether the actions of Roy Hindsley, appellee here, were sufficient to take an oral lease out of the statute of frauds. We find that they were not.

Hindsley had been a tenant on farm lands owned by appellant Mary G. Norton for a number of years prior to January 1, 1967. On February 13, 1967, appellant filed an action in unlawful detainer against Hindsley, who filed a cross bond to retain possession. His answer contained allegations that on or about the first day of November 1966, he 'made a binding agreement for the rental of such lands with the plaintiff (appellant) and that plaintiff accepted his rent notes in the amount of $15,000 representing the rentals to be due upon such lands for the period 1967, 1968, and 1969.' (Emphasis ours.) Appellee also alleged that proper notice of termination had not been given him, even if a new agreement had not been made.

Mrs. Norton is nearly 80 years of age. She testified that she told Hindsley and his wife when they called upon her in late October 1966, that she was going to have to get the best rent she could for 1966 and that Hindsley should go to her son whom she had authorized to act, about renting the land. According to her, Mrs. Hindsley returned and gave her a piece of paper, saying it was 'the rent note.' Mrs. Norton stated that she was in bed, did not have her glasses, and did not even look at the paper, but reminded Mrs. Hindsley that she had told Hindsley to go to her son. Mrs. Norton did not know what she had done with the paper Mrs. Hindsley handed to her. She admitted having told Hindsley he could rent the land at her price.

Mrs. Norton's son, Earl, testified that he negotiated the agreements with Hindsley for the renting of the lands for many years and specifically for the years 1964, 1965, and 1966. He stated that after Hindsley's visit to Mrs. Norton, he took two notes he found on his mother's dresser and told Hindsley that he could not have the farm for $5,000 per year but that the rent would be $7,000. He further stated that Hindsley agreed, whereupon he took a note in that amount to Hindsley, who refused to sign it, saying that he would not pay that much rent.

There was evidence indicating that appellee was given written notice by appellant's attorney that his right to possession would terminate December 31, 1966, and that appellant was insisting upon possession at that time. This was done by letter dated November 10, 1966.

Hindsley testified that on the occasion of his visit to Mrs. Norton, she told him to prepare the rent notes for 1967, 1968, and 1969, saying that her son wanted to rent the land to some of his friends. According to him, the notes were prepared by one Davidson and taken by Mrs. Hindsley for delivery to Mrs. Norton. He denied having previously dealt with Earl Norton but admitted that Earl Norton had talked to him about the farm rental. He claimed that he caused the 'diverted acres' on the land to be plowed, thinking he had rented it for three years.

Mrs. Hindsley corroborated her husband's testimony about their visit to Mrs. Norton. She testified that she took rent notes for $5,000 each for 1967, 1968, and 1969 to Mrs. Norton, who stuck them under a towel spread across her lap, saying 'all right.'

Mrs. Earl Norton testified that she typed the rent notes for 1964, 1965, and 1966. Mrs. Hindsley stated that Mr. Davidson had not previously prepared rent notes for the parties.

Our statute of frauds requires that a contract for lease of lands for a term longer than one year be in writing signed by or on behalf of the party to be bound. Ark.Stat.Ann. § 38--101 (Repl.1962). No such writing was offered in evidence. Unless the acceptance of the notes signed by appellee by appellant, or appellee's action in plowing some of the acreage involved, took the transaction outside the application of the statute of frauds, appellee could not be entitled to judgment.

Under our decisions, it is clearly established that the mere breaking of ground is not such a valuable and permanent improvement as to take the case out of the statute of frauds. French v. Castleberry, 238 Ark. 1038, 386 S.W.2d 482; Ashcraft v. Tucker, 136 Ark. 447, 206 S.W. 896; Garner v. Starling, 137 Ark. 464, 208 S.W. 593. Furthermore, part performance as a defense is available in equity only, and cannot take any case at law out of the statute of frauds. Therefore, it cannot be a defense in an action in unlawful detainer, at least where there was no effort to transfer the cause to an equity court. Ozan Lumber Co. v. Price, 219 Ark. 709, 244 S.W.2d 486; Henry & Bros. v. Wells, 48 Ark. 485, 3 S.W. 637; Mitchell v. Hanley, 171 Ark. 456, 284 S.W. 535.

Mrs. Norton's mere acceptance and retention of the notes signed by Hindsley will not suffice to take the oral contract out of the statute of frauds. Bromley v. Aday, 70 Ark. 351, 68 S.W. 32. Even the advance payment of rent under a parol contract for a lease for more than one year cannot extend the tenancy beyond one year. Brockway v. Thomas, 36 Ark. 518. Even if the retention of the notes could be said to have constituted ratification of a verbal contract required by statute to be in writing, the contract would not be validated for its full term, but ratification would extend only to any period of actual performance under the contract. Bald Knob Special School District v. McDonald, 171 Ark. 72, 283 S.W. 22.

The statute requires that the written memorandum be signed by the party to be charged. Elm Springs State Bank v. Bradley, 179 Ark. 437, 16 S.W.2d 585. The party to be charged is the one against whom the contract is sought to be enforced in the action. Lee v. Vaughan's Seed Store, 101 Ark. 68, 141 S.W. 496, 37 L.R.A. (n.s.) 352; Jones v. School District No. 48, 137 Ark. 414, 208 S.W. 798; Chicago Mill & Lbr. Co. v. Mattews, 163 Ark. 571, 260 S.W. 963. The notes prepared by Hindsley could not constitute the writing required, not only because they were not signed by appellant, but also because the land involved is not in any way identified therein, as required by the statute. McCorkle v. H. K. Cochran Co., 144 Ark. 269, 222 S.W. 31; Faith v. Epperson, 213 Ark. 1002, 214 S.W.2d 223; Hotopp v. Adair, 144 Ark. 629, 223 S.W. 393; Briggs v. Frazer, 157 Ark. 518, 249 S.W. 9.

No specific mention was made of the statute of frauds until the conclusion of all the evidence. Then, appellant's attorney requested that the jury be instructed that appellee could not have a three-year lease on the property since it would be within the statute of frauds. He contended that, giving the evidence on behalf of appellee its strongest probative force, it only indicated that Mrs. Norton had orally consented to a three-year lease, and had not executed the notes presented as evidence of the rent contract.

This request was refused by the circuit judge, who stated that Mrs. Norton's acceptance of rent notes prepared according to her instructions would constitute a valid three-year lease. Appellant's attorney also objected to the giving of appellee's requested instruction No. 1 as to the words sufficient to constitute a lease for the reason that neither it, nor any other instruction, covered the statute of frauds. Objection was also made, for the same reason, to appellee's requested instruction No. 2 in which the circuit judge told the jury that acceptance of rent notes for 1967, 1968, and 1969 pursuant to an oral agreement between the parties would constitute a valid and binding lease contract for a three-year period. Appellant also requested an instruction stating the requirements of the statute of frauds, which would not have permitted the jury to consider whether any lease was entered into except for the year 1967. This request was refused.

It was clearly error on the part of the trial judge to give appellee's requested instructions 1 and 2 over the objection of appellant. Neither of them would have allowed consideration of the application of the statute of frauds to the dealings between the parties. In effect, the trial court held that the actions of the parties took the matter out of the statute of frauds. This was error.

It is urged, however, that the statute of frauds cannot be relied on by appellant because of her failure to plead it. It is generally held that reliance upon the statute of frauds as an affirmative defense is conditioned upon assertion of the defense in a pleading. See S. H. Kress & Co. v. Moscowitz & Zucker, 105 Ark. 638, 152 S.W. 298. This rule is apparently based on the theory that an oral contract raises a moral obligation, at least, so that a party against whom it is asserted has the option of either pleading the statute of frauds as a defense or waiving it. Skinner v. Fisher, 120 Ark. 91, 178 S.W. 922. While this is a sound rule, there are situations to which it cannot and should not be strictly applied.

When an oral contract is pleaded by the adverse party or admitted by the pleader, the latter must specifically plead the statute of frauds in order to rely upon it. Stooksberry v. Pigg, 172 Ark. 763, 290 S.W. 355. It has often been held, however, that the denial of the existence of a contract asserted in a complaint is...