Opinion ID: 1776747
Heading Depth: 2
Heading Rank: 1

Heading: Evidence of an Agreement

Text: In this connection, the Holmans submitted the affidavit of Dennis Abbott, their former legal counsel. Abbott stated, in pertinent part: On or about August 29, 1997, I was contacted by the [Holmans] to close a construction loan on [tract II]. I was told by the [Holmans] that there was no payoff amount for this tract and that they had previously entered into an agreement with [the Bank] to the effect that if they sold [tract I] and their personal residence and paid [the Bank] certain agreed upon amounts, the Bank would, in turn, release [tract II], with no additional consideration so that the [Holmans] could obtain a construction loan. On or about August 29,1997, I contacted Louie Henry to confirm the payoff amount and/or release agreement. Mr. Henry informed me that the Bank had, in fact, agreed to release [tract II] with no additional consideration. He acknowledged to me that he was aware that the Holmans were going to build a house on that tract and that the Bank had entered into an agreement several months prior thereto that it would release [tract II] for no additional consideration conditioned on the sale of [tract I] and the payment of $175,000.00 to the Bank.... I informed Mr. Henry that a title search revealed that [tract II] had not been released. He advised me to prepare a partial mortgage release and send it to him and that he would execute it and file it of record. Based on these representations, I closed the construction loan on the property and mailed the partial mortgage release to Mr. Henry. On or about July 2, 1998, I was again contacted by the [Holmans] to close a second mortgage on [tract II] to enable [them] to complete construction of their residence. Title work done at that time revealed that [tract II] had still not been released from the original mortgage to [the Bank]. I contacted [the Bank] at that time and received assurances that the failure to release the property was merely an oversight and that if a partial mortgage release was again sent to the Bank, it would be executed and filed of record. Based on these representations, I closed the second mortgage on [tract II] and mailed another partial mortgage release to [the Bank]. On or about December 11, 1998, I was again contacted by the [Holmans] to close a second mortgage on [tract II]. The prior second mortgage was to be paid off and additional funds were being borrowed by the [Holmans]. Title work performed at the time revealed the existing second mortgage and also revealed that [the Bank] had still not released [tract II] from the original mortgage. I obtained a payoff on the existing second mortgage and contacted [the Bank] concerning its failure to release [tract II] as agreed. I again received assurances from the Bank that the failure to release the property was merely an oversight and that if I would send yet another partial mortgage release, it would be executed and filed for record. To the best of my knowledge and belief, I insisted that a partial mortgage release be faxed to the Bank and that the release be signed and faxed back to me for my file so that I could be assured at that time that the mortgage would be released. To the best of my knowledge, this was done and an executed copy of the partial mortgage release was faxed to my office. Based on the repeated assurances from [the Bank], the transaction was closed with a check being sent to pay off the existing second mortgage holder and an original partial mortgage release being sent to [the Bank] for execution and recordation. I had no other dealings with the [Holmans'] property until on or about July 25, 2000. The [Holmans] contacted me and informed me that the second mortgage was being refinanced and that title work done by another attorney revealed that [tract II] had never been released from the original ... mortgage. Subsequently, I contacted [the Bank] and was advised that Louie Henry no longer worked for the Bank. I talked with another bank official and was advised that the Bank was not in a position to execute and file a release.... On or about August 1, 2000, I talked with Louie Henry by telephone. The only property we discussed was [tract II] where the [Holmans'] residence was located. Henry assured me at that time that the Bank had agreed to release [tract II] from the original mortgage and that, in his best judgment, he had actually signed the partial mortgage release. He further stated that he did not know why the release had not been recorded or why the Bank was now refusing to release the property. The Holmans contend that this affidavit, at the very least, establishes an issue of fact regarding the existence of the [Bank's] release of the subject property. Holmans' Brief, at 21. They argue, in other words, that the defendants have admitted to an agreement to execute and record a release, and that, therefore, they are estopped to deny its existence. We disagree with this contention. To be sure, a party may be equitably estopped to raise the Statute of Frauds as a defense under certain limited circumstances. Pate v. Billy Boyd Realty & Constr., Inc., 699 So.2d 186, 192 (Ala.Civ. App.1997). However, this Court has made clear that a party cannot create an `estoppel bar to raising the Statute of Frauds merely because a party admits, either judicially or extrajudicially, the existence of or the substance of an oral contract within the Statute.' Rice v. Barnes, 149 F.Supp.2d 1297, 1302 (M.D.Ala.2001) (emphasis added) (quoting Pate, 699 So.2d at 192). This is so, because to enforce an oral contract against a party merely because he or she admitted to its existence and substance ... is likely to promote perjury. Instead of admitting to the contract, the breaching party would be tempted to deny the agreement in order to escape liability. Darby v. Johnson, 477 So.2d 322, 327 (Ala.1985); see also Durham v. Harbin, 530 So.2d 208, 212-13 (Ala.1988). Despite the statements in Abbott's affidavit, neither an original nor a copy of the partial release relating to tract II has surfaced in this action. Neither has any writing evidencing the alleged agreement between the Bank and the Holmans for the release of tract II in exchange for $175,000 of the sales price of tract I been produced. Moreover, to the extent that Henry's alleged assurances regarding the understandings of the parties constitute admissions, they do not, as a matter of law, create a bar to the operation of the Statute of Frauds. The Holmans next contend that the Statute of Frauds does not bar their action, because, they insist, they have met the partial performance exception requirements to the Statute of Frauds. Holmans' Brief, at 24. We also disagree with this contention.