Gest v. Frost
Gest v. Frost
Opinion of the Court
Appellant appeals as of right from
Facts
Mr. Frost died on February 2, 1981. On February 19, 1981, appellee Jerry Lee Frost filed a petition to commence probate proceedings. Appellant filed his claim against the estate on March 23, 1981, alleging that he and decedent had entered into a written agreement on October 25, 1979, whereby appellant was to remove all specified timber from a parcel of land owned by decedent. Decedent, it was alleged, had subsequently breached the agreement by allowing others to remove timber from that land. Attached to appellant’s claim was a copy of the agreement which read as follows:
"Glenn L. Gest 10/25/79
"Sold all trees for $4.00 per rick. 16" dimensions 8 feet [crossed out word] high, 4 feet long. Does not cut anything that will log out 16 feet long and 12 inches on top end. Take all wood sawable. Bunch brush burnable.
"Owner Warren Frost [signature]
G. L. Gest [signature] Buyer”
(Original spelling corrected.)
At the January 28, 1982, hearing on appellant’s claim, appellee raised the statute of frauds as a defense, arguing that the writing was insufficient to support appellant’s claim of a contract because it failed to include a quantity term. The probate court rejected appellant’s argument that the word "all” was a quantity term and held that the agreement was unenforceable under the statute of frauds provision of the Uniform Commercial Code, MCL 440.2201(1); MSA 19.2201(1). The court held
Quantity Term
Both parties have conceded that the agreement in question falls within the Uniform Commercial Code, MCL 440.2170; MSA 19.2107. The agreement apparently anticipated a sale for at least $500 since both parties also agree that MCL 440.2201; MSA 19.2201 applies. Section 2201 provides that such a contract is not enforceable 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 * * *. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing.” The Official Comment to this provision states that the purpose of the writing requirement is to "afford a basis for believing that the offered oral evidence rests on a real transaction”. The only term which must appear in the agreement is the quantity term. The requirement that the contract include a quantity term was adopted by this Court in West Central Packing, Inc v A F Murch Co, 109 Mich App 493, 500-501; 311 NW2d 404 (1981), and Ace Concrete Products Co v Rogers Construction Co, 69 Mich App 610; 245 NW2d 353 (1976).
In Ace Concrete, this Court held that parol evidence could not be offered to supply a missing quantity term. Instead, stated the Court, the quantity term must appear in the writing. Ace Con
While there is not Michigan case law precisely on point, we are in agreement with appellant that the requisite quantity term was supplied by the written agreement in the instant case. In Port City Construction Co, Inc v Henderson, 48 Ala App 639; 266 So 2d 896 (1972), the Court of Civil Appeals of Alabama, applying the Uniform Commercial Code, found an agreement to supply "all concrete” for a "slab” which was not further defined in the writing to contain a sufficient quantity term. While agreeing that, if the writing contained all of the terms agreed upon by the parties, parol evidence of additional terms would not be allowed, the Court found that the writing was not clear and certain in all of its terms. Although the specific quantity was not included, the Court found the term "all the concrete for slab” to be a requirement quantity sufficient to "satisfy the statute when it may be made certain by parol evidence of the surrounding circumstances. The slab referred to was capable of being identified with reasonable certainty as was the location and dimensions.” Port City, supra, p 644. Although the agreement in the instant case was not a requirements contract, it may arguably be analogized to an output contract, MCL 440.2306; MSA 19.2306, which may also include the term "all” as a valid term. See McNussen v Graybeal, 146 Mont 173; 405 P2d 447 (1965).
" 'When quantity is not precisely stated, parol evidence is admissible to show what the parties intended as the exact quantity,’ * * * but where the writing relied upon to form the contract of sale is totally silent as to quantity, parol evidence cannot be used to supply the missing quantity term.” (Citations omitted.)
Once a quantity term is found to exist in the agreement, the agreement need not fail because the quantity term is not precise. As § 2201(1) itself says: "A writing is not insufficient because it omits or incorrectly states a term agreed upon * * As has been stated, the purpose of the required writing is to provide a basis for believing that oral evidence which is offered rests upon a real transaction. Once this purpose has been satisfied, i.e., the requirements of §2201 have been fulfilled, the question to be resolved is whether parol evidence may be admitted in order to make the agreement sufficiently definite to be enforceable.
Parol Evidence
MCL 440.2204; MSA 19.2204 provides that "[e]ven though one or more terms are left open a contract for sale does not fail for indefiniteness if
Parol evidence may be admissible under MCL 440.2202; MSA 19.2202, which provides that terms intended by the parties to be a final expression of their agreement as they are set forth in a writing may not be contradicted "by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented” by course of dealing, usage of trade or course of performance and by evidence of "consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement”.
It is apparent from a reading of these two sections that once the basic requirements of § 2201 are met, additional evidence may be offered to explain or complete the writing. In the instant case, however, the probate court ruled that, because the writing failed to describe the land on which the trees were located, the agreement did not state an ascertainable quantity. Citing Ace Concrete, supra, p 615, the court determined that appellant could not introduce evidence to further clarify the writing, as that would be violative of the parol evidence rule.
Appellant claims on appeal to have evidence showing that he had partially removed the trees referred to in the writing on a particular parcel of land, pursuant to the agreement, prior to the decedent’s breach of their contract. This would be evidence of course of performance (see MCL 440.2208; MSA 19. 2208), and therefore admissible as parol evidence under MCL 440.2202(a); MSA 19.2202(a). Such evidence is particularly relevant for, as the Official Comment to § 2202 states, "the course of actual performance by the parties is considered the best indication of what they intended the writing to mean”.
Parol evidence consisting of the descriptions of the various parcels of land owned by decedent at the time the writing was made may also be helpful. It is possible that much of the land owned by decedent was unsuited to the harvesting of timber, thus further clarifying the terms of the agreement. We do not limit here, however, the types of parol evidence which may be offered on remand. That evidence shall be whatever is relevant and helpful in proving the intent of the parties to the contract, subject to the probate court’s discretion as regards applicable rules of evidence.
Conclusion
The probate court erred in finding that no quantity term appeared in the writing evidencing the
Reversed and remanded. Costs to abide the final outcome.
Although the probate judge was presumably referring to § 2202, strictly speaking the common-law parol evidence rule would not prohibit extrinsic evidence to show the intent of the parties in the present case. That rule prohibits only the contradiction of an integrated writing and "protects a completely integrated writing from being varied and contradicted by parol”. 3 Corbin, Contracts, § 575, p 381. Extrinsic evidence is admissible to show that the writing is not complete. Cited approvingly at Corbin, supra, § 582, p 451, is Yezbak v Croce, 370 Pa 263, 266; 88 A2d 80 (1952) which stated: "The parol evidence rule is based on the assumption that the written contract
In the instant case, it is clear from the face of the writing that it did not contain the complete agreement as assented to by the parties.
Under the parol evidence rule, parties may introduce evidence not intended to contradict an integrated writing. "Since the rule is supported by the public policy of preventing frauds and perjuries by limiting evidence of facts that contradict a valid contract, the rule does not apply to prevent proof’ of one or more of the terms of the contract. Corbin, Contracts, 1982 Supplement, § 572C, p 513.
It should be noted here that, even given the writing’s total silence as to quantity, at least one commentator has criticized this Court’s holding in Ace Concrete Products Co v Rogers Construction Co, 69 Mich App 610; 245 NW2d 353 (1976). In Williston, Sales (4th ed), Cumulative Supplement, § 14-7, p 31, it was suggested that § 2201(1) has no requirement that there be a quantity term, but simply provides that the contract will not be enforced beyond the quantity of goods shown in the writing. Since requirements contracts governed by §2306 of the Uniform Commercial Code could often not specify a quantity with mathematical exactness yet are still enforceable contracts, the writing in Ace Concrete should not have been deemed insufficient and the quantity term should have been provable by parol.
Reference
- Full Case Name
- IN THE MATTER OF THE ESTATE OF FROST GEST v. FROST
- Cited By
- 2 cases
- Status
- Published