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Vermont Supreme Court - 147 Vt. 128
tl;dr:
Two people made a deal for sale of a portion of property contingent on approval from a third party. They agreed to go through with the sale permit or not, but then the third party denied the permit and the seller backed out of the deal.Video Summary
Case Summary
In the 1986 contract law case, Chomicky v. Buttolph, the Vermont Supreme Court looked at whether an oral agreement for a land sale could be enforced under the statute of frauds. The dispute was about a buyer trying to enforce a land sale agreement after the seller backed out.
Edward and Barbara Buttolph (sellers) wanted to sell their lakeside property to Eugene and Georgianna Chomicky (buyers). They signed a contract, but it depended on the sellers getting approval from the local planning commission. When that approval was denied, the buyers suggested an alternative plan, and the sellers verbally agreed. However, the sellers later changed their minds and refused to complete the sale. The buyers sued for breach of contract and specific performance.
The trial court ruled in favor of the buyers, and the sellers appealed. The Vermont Supreme Court also sided with the buyers, enforcing the oral agreement under a narrow interpretation of the statute of frauds. The court said that as long as a contract could possibly be performed within a year, it could be enforced. No time limit for performance was specified in this case, so it could have been completed within a year.
This case is significant because it demonstrates that oral contracts can sometimes be enforced, even if they do not meet all the formal requirements of the statute of frauds. The case is often cited and discussed in contract law education as an example of how the statute of frauds works.
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The court overturned the lower court's order for specific performance of an alleged oral agreement for the sale of lakeside property due to the Statute of Frauds, which requires such contracts to be in writing to be enforceable. The plaintiffs' claim for damages was also denied. The court noted that any proposed changes or modifications to a contract are subjected to the same requirements of form as the original provisions. The court ruled that even if a party admits to the existence of an oral contract, it is still subject to the Statute of Frauds, which serves as a shield against possible fraud and promotes deliberation, seriousness, and certainty in contracts for the sale of land or interests therein. The doctrine of part performance is invoked to give relief to those who substantially and irretrievably change their position in reliance on an oral agreement to convey real estate. However, the reliance must be something beyond injury compensable by money to warrant taking the contract outside the Statute of Frauds.
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