Moore v. Day

Respondents commenced an action against appellant to recover damages for breach of contract. Their amended complaint alleged in substance that on or about March 1, 1948, the parties entered into an oral contract whereby appellant agreed to purchase 83,670 pounds of beans from respondents at 17% cents per pound; that on numerous occasions thereafter appellant stated that he would take the

Appellant’s answer put in issue the material allegations of the amended complaint and interposed the affirmative defense of the statute of frauds on the ground that the alleged contract for a sale of goods of a value of more than $500 was not in writing. At the trial the issues raised by the pleadings were enlarged so as to include the further defense that if any contract were made by Jack Gilligan as agent of appellant, it was void as it was not authorized in writing as required by section 2309 of the Civil Code.

The trial court found generally that the allegations of the amended complaint were true; that Jack Gilligan was the duly authorized agent of appellant; that all his acts in connection with the purchase and delivery of the beans were within the scope of his agency and authorized by appellant; and that appellant was estopped to avail himself of the defense of the statute of frauds. Judgment was rendered in favor of respondents, awarding them $356.50 for fumigation and warehouse charges and damages of $8,676.89, the amount of the admitted difference between the contract price and sums realized from subsequent sales of a portion of the beans.

Disregarding conflicts in the evidence, which the trial court has resolved in favor of respondents, the facts are that in 1948 and for many years prior thereto appellant had been a broker and merchant and had previously purchased beans

did want those Moore beans, your salesmanship sold those beans to me.” Whereupon, Gilligan informed respondents that he thought appellant was backing out. Respondents then began to fear the deal was “shaky” and endeavored to personally contact the appellant. The respondents and appellant met for the first time in the early part of August at which time appellant assured them that he would take the beans at 17% cents per pound, and when pressed for a written contract said he would send one by Gilligan as he had been handling the matter. Respondents admit they had not theretofore requested a written contract as they considered they did not need one as the beans had been sold to appellant as of March 1, 1948. On September 10th appellant refused to pay more than 9 cents per pound, which respondents refused to accept. Thereafter they were able to sell only a portion of the beans and at less than 9 cents per pound, and

Appellant urges a number of contentions for a reversal of the judgment, the principal of which is that the evidence does not support the judgment. It is appellant’s position that the transaction was within the statute of frauds, and that there was no competent evidence either that Gilligan was an authorized agent of appellant or that any enforceable contract for the purchase of the beans was ever entered into. Respondents concede here, as they did at the trial, that there was no written agreement for the purchase of the beans, but it is respondents’ contention that the conduct of appellant was such that he is estopped from setting up the statute of frauds. The trial court agreed with this contention of respondents and stated in its memorandum opinion:

“A complete review of the evidence discloses that the circumstances surrounding this entire transaction clearly indicates that the words and the conduct of the defendant amounted to an inducement that a written contract would be waived, and that to assert the invalidity of the contract, would constitute a fraud upon the plaintiff. The acts and the conduct of the defendant clearly indicate that he did not intend to avail himself of the statute. To permit him now to set up the Statute of Frauds as a defense would allow him to use the Statute as a sword and not as a shield.”

There can be no doubt that in a proper case a person may be estopped from setting up the statute of frauds as a defense. In one of the leading California cases upon this question, Seymour v. Oelrichs, 156 Cal. 782 , it is said at pages 794-795 [ 106 P. 88 , 134 Am.St.Rep. 154 ]:

‘ ‘ The right of courts of" equity to hold a person estopped to assert the statute of frauds, where such assertion would amount to practicing a fraud, cannot be disputed. It is based upon the principle ‘thoroughly established in equity, and applying in every transaction where the statute is invoked, that the statute of frauds, having been enacted for the purpose of preventing fraud, shall not be made the instrument of shielding, protecting, or aiding the party who relies upon it in the perpetration of a fraud or in the consummation of a fraudulent scheme.’ (2 Pomeroy’s Equity Jurisprudence, sec. 921.) It was said in Glass v. Hulbert, 102 Mass. 24 , 35 [ 3 Am.Rep. 418 ]: ‘The fraud most commonly treated as taking an agreement out of the statute of frauds is that which consists in setting up the statute against its enforcement, after the other

“We can see no good reason for limiting the operation of this equitable doctrine to any particular class of contracts included within the statute of frauds, provided always the essential elements of an estoppel are present, or for saying otherwise than as is intimated by Mr. Pomeroy in the words already quoted, viz., that it applies ‘in every transaction where the statute is invoked.’ It is a general equitable principle,- a part of the broader equitable doctrine stated in Dickerson v. Colgrove, 100 U.S. [578] 580 [ 25 L.Ed. 618 ], and quoted therefrom in Carpy v. Dowdell, 115 Cal. 687 [ 47 Pac. 695 ], as follows: ‘The vital principle is that he who by his language or conduct leads another to do what he would not otherwise have done shall not subject such person to loss or injury by disappointing the expectations upon which he

Disregarding, as we must, all conflicts in the evidence, it appears from the evidence and the inferences that may reasonably be drawn therefrom that Gilligan was a buyer who had been buying beans for appellant; that late in February he .had made an offer of 17% cents per pound for respondents’ beans on behalf of appellant; that respondents accepted the offer, which acceptance was communicated to appellant by Gilligan; that appellant was to take delivery of the beans in two weeks, but from time to time sent word to respondents through Gilligan postponing the acceptance of the beans but assuring respondents that he would complete the purchase; that about July 1st, Gilligan urged appellant to complete the transaction and that appellant then for the first time indicated that he did not want the beans; that Gilligan then told respondents what appellant had said and one of respondents endeavored to see appellant and did see him about August 1st at which time appellant assured respondents he would keep his agreement to buy the beans for 17% cents and would send a written contract by Gilligan; that one of respondents saw appellant about August 17th and asked him to set a date for the delivery of the beans and the completion of the sale, and appellant set the date of September 10th; that on September 10th appellant for the first time told respondents that he would not go through with the purchase at 17% cents but would pay only 9 cents per pound, which offer was refused by respondents; that at all times since Gilligan first communicated to appellant the acceptance by respondents of appellant’s offer of 17% cents per pound for the beans respondents considered the beans sold to appellant and relied upon appellant’s continued assurances that he would complete the transaction at the agreed price, and made no effort to market said beans; that the market broke sharply not long before appellant definitely informed respondents that he would only pay 9 cents per pound for the beans; that the beans were thereafter disposed of by respondents at the best prices they could obtain but at considerably less than 17% cents per pound.

Applying the well-settled principles hereinbefore set forth to the factual situation in the instant case we believe that the court’s finding that appellant was estopped from availing himself of the statute of frauds is supported by the evidence and the law. The court was fully justified in concluding

Appellant contends that the court erred in permitting oral evidence to be received tending to prove that Jack Gilligan was an agent of appellant and also that the finding that Gilligan was the duly authorized agent of appellant and that all of his acts with reference to the purchaser of the beans were within the scope of his agency are not supported by the evidence. If the only issue in the case was whether or not the statute of frauds had been complied with there would be considerable merit in these contentions of appellant. However, upon the issue of estoppel, which was clearly in the case, the evidence was admissible as bearing upon the connection and relationship between Gilligan and appellant. The court determined the case upon the issue of estoppel and, as related to such an issue, the finding is supported by the evidence. There can be no question as to the fact that Gilligan was sent by appellant to buy respondents’ beans and that he carried messages back and forth between appellant and respondents, and in that sense he was an agent so far as the issue of estoppel is concerned.

Appellant contends, also, that the trial court erred in not making findings of fact upon appellant’s affirmative defense of the statute of frauds. This contention is without merit. Respondents’ amended complaint conceded that the contract in question was an oral contract. Respondents then stated facts which they alleged estopped the appellant to assert the unenforceability of the oral contract. Appellant answered, setting up a general denial and the statute of frauds as a defense. The trial court found that all of the allegations contained in these paragraphs were true and further specifically found that the “defendant, Roy M. Day, is estopped to avail himself of the Statute of Frauds as a defense to the plaintiffs’ action herein.”

It is well settled in California that “it is not necessary to make specific findings as to each of several material