Question

A Question of Ethics-Statute of Frauds.Daniel Fox owned Fox & Lamberth Enterprises, Inc., a kitchen remodeling business. Fox leased a building from Carl Hussong. When Fox planned to close his business, Craftsmen Home Improvement, Inc., expressed an interest in buying his assets. Fox set a price of $50,000. Craftsmen's owners agreed and gave Fox a list of the desired items and a "Bill of Sale" that set the terms for payment. Craftsmen expected to negotiate a new lease with Hussong and modified the premises, including removal of some of the displays. When Hussong and Craftsmen could not agree on new terms, Craftsmen told Fox that the deal was off. [Fox & Lamberth Enterprises, Inc. v. Craftsmen Home Improvement, Inc., _ N.E.2d _ (2 Dist. 2006)] 1. In Fox's suit for breach of contract, Craftsmen raised the Statute of Frauds as a defense. What are the requirements of the Statute of Frauds? Did the deal between Fox and Craftsmen meet these requirements? Did it fall under one of the exceptions? Explain. (See The Formation and of Sales and Lease Contracts.) 2. Craftsmen also claimed that the "predominant factor" of its agreement with Fox was a lease for Hussong's building. What is the predominant- factor test? Does it apply here? In any event, is it fair to hold a party to a contract to buy a business's assets when the buyer is unable to negotiate a favorable lease of the premises on which the assets are located? Discuss

Answer 1

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Answer: Requirement : under the ucc's statute of frauds, a Contract for a Sale of goods priced at $300 (or) more must be in writing. writing is sufficient if it indicates a antract between the parties and is signed by the party against whom enforcement is sought- A Contract is not enforceable beyond the avantity of goods Among The other to writing. exceptions there requirements a contract will be enforceable enforceable be to the to the extent that buyer has the extent received (or) accepted the goods. This can occur when, for example, a buyer does any act inconsistent with the seller's ownership of those goods. This is the u parnal performance" exception. in this case, " the the Court Court aworded a worded fox f 4 Fox $ 41262-32 an damages, and Crafstonen appeated to a state intermediate appellate. which affirmed the lower curt's decision. The appellate court concluded, a " partial pastial performance performance occor occored when Craftsman entered Fox's Showroom, modified displays, and sen portions of the displays to craftsmen's Showroom. These actions were inconsistent with benership of the assett Fox" craftsmen argued that this conclusion improperly mixed the use of the premises with the sale of goods the Court alknowledged that craftsman significantly altered the premises which consisted of real property and not goods subject to the vic, but emphalized what craftsmen did to, and with the displays. These acts were completely unconsistent with ownership of the displays by Fox . Consequently, the record contains sample evidence of partial performance or acceptance of the goods.

Reaquirement @ In craftsmen's appeal from the judgement against it, an ohio State intermediate appellate Court disagreed with craftsmen's contention that the predominant factor of its agreement with fox was a lease for the ussong's building, The court fund nothing to indicate that the parties intended to enter into a contract for a lease. " In fact, none of the writings even motion a lease agreement" Besides, the "predominant factor" test concems whether a contract for a sale of goods is services Should fall under the vic because it is primarily a contract for a sale of goods. The court said, This wa not be an issue in the present case, since the agreed - upon terms were for the sale of goods. In any event, there was no agreement for a lease of course, it can be fair to hold a party to a contract to boya bostness's assers when a lease of premises on which the assere are located cannot be negotiated favorably for the buyer unless the execution of a tease is a condition e parties agreement, it would most treely be ostar that the agreement was not enforceable on this basis. The WC would provides that a contract with not fair for indefiniteness it one cor more of the forms are left open but there must be a reasonably certain basis on which a court con grant a remedy. In this case, For and cratstimen did not discuss Fox's lease with the Hossongs, nor did they indicate in their writing that a lease was a condition of their deal. Even if they had discussed a lease, il introduction as a term of ther contract might have been barred under the parol evidence rule. Thus, there was no basis on which to include it as a term of their contract.