Friday, April 24, 2009

Statute of Frauds Bars Application of Contract

This week the Fifth DCA held the statute of frauds bars enforcement of a contract to provide fre reclaimed water to a west Orange County golf course. In City of Orlando v. West Orange County Club (5D08-1887 & 5D08-1901), the plaintiff golf course agreed to pay $50,000 to upgrade its pumping capabilities and cease using its current natural water supply in order to accept free reclaimed water for twenty years. Approximately five years into the agreement, the county informed the golf course that the county had not executed the contract and the golf course (along with every other user of the reclaimed water) was going to be required to pay for the water.

The golf course sued and attempted to enforce the contract and the Fifth DCA reversed the trial court and held "Here, it is undisputed that Plaintiff seeks to enforce a contract that called for performance for more than a year, and which was not signed by or on behalf of either party which Plaintiff seeks to hold liable for performance. Therefore, the statute of frauds plainly bars enforcement of the contract." The trial court applied promissory estoppel, however, the Fifth DCA stated the law is clear that promissory estoppel cannot be used to escape the statute of frauds.

The court also considered and declined to apply the tipsy coachman doctrine in support of plaintiff's argument that the ultimate decision of the trial court was correct because of the partial performance of the contract. The Fifth DCA held that since the partial performance by the parties was not the same as the performance required by the contract, you cannot find mutual assent to the contract by performance or signature (the golf course only accepted 47,000,000 gallons of water a year as opposed to the 75,000,000 required by the contract). In dicta, the court indicates it is unsure partial performance could ever be used to bind a party in a situation such as this.

Finally, the court indicates sovereign immunity would be yet another bar to enforcing the contract.


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