Opinion ID: 780630
Heading Depth: 2
Heading Rank: 2

Heading: Conformity with the Statute of Frauds

Text: 24 CDC also argues that the district court erroneously concluded that its purported agreement with JMJ did not conform with the Illinois statute of frauds. It asserts that even though there was no single document that was signed by both parties agreeing to the terms and conditions, the Spring 1997 exchange of letters sufficiently enumerated the basic terms of the parties' agreement. The Illinois statute of frauds provides that actions regarding a sale of land are barred unless the land sale agreement is memorialized in writing: 25 No action shall be brought to charge any person upon any contract for the sale of lands ... unless such contract or some memorandum or note thereof shall be in writing, and signed by the party to be charged therewith, or some other person thereunto by him lawfully authorized in writing, signed by such party. 26 740 ILCS 80/2. The writing required by the statute need not itself be a valid contract, but only evidence of one. Crawley v. Hathaway, 309 Ill.App.3d 486, 242 Ill.Dec. 677, 721 N.E.2d 1208, 1211 (1999) (quoting Melrose Park Nat'l Bank v. Carr, 249 Ill.App.3d 9, 188 Ill.Dec. 269, 618 N.E.2d 839, 843 (1993)). To satisfy the statute of frauds, however, a written memorandum must contain on its face the names of the vendor and vendee, a description of the property sufficient to define it as the subject matter of the contract, the price and other terms and conditions of the sale, and the signature of the party to be charged. Crawley, 242 Ill.Dec. 677, 721 N.E.2d at 1210 (quoting Callaghan v. Miller, 17 Ill.2d 595, 162 N.E.2d 422, 424 (1959)). A writing can satisfy the statute even if it is made up of several documents, such as notes, papers, or letters as long as, taken together, they contain the required information either on their face or by reference to other writings. American Coll. of Surgeons v. Lumbermens Mut. Cas. Co., 142 Ill.App.3d 680, 96 Ill.Dec. 719, 491 N.E.2d 1179, 1192 (1986). 27 Even if CDC and JMJ had manifested an intent to be bound by the Spring 1997 exchange of letters, those letters did not meet the mandates of the statute of frauds. Most notably, CDC presented no evidence that either of the letters was signed by an authorized agent of JMJ, the party to be charged under the contract. See Prodromos v. Poulos, 202 Ill.App.3d 1024, 148 Ill.Dec. 345, 560 N.E.2d 942, 946 (1990). It is undisputed that Morse, JMJ's president, did not sign the April 8 letter that JMJ sent to Cohen. Although Cohen testified at trial that the signature appears to be the signature of [Morse's] secretary, he could not definitively identify who had signed the document. But even if the letter had been signed by Morse's secretary, CDC presented no evidence that she had written authority to sign an agreement with CDC. See Leekha v. Wentcher, 224 Ill.App.3d 342, 166 Ill.Dec. 599, 586 N.E.2d 557, 560 (1991) (agent must have written authority to sign contract for sale of land) (quoting Prodromos, 148 Ill.Dec. 345, 560 N.E.2d at 946); Schoenberger v. Chicago Transit Auth., 84 Ill.App.3d 1132, 39 Ill.Dec. 941, 405 N.E.2d 1076, 1080 (1980) (person alleging agent's authority must prove source of that authority). Additionally, there is no evidence that Morse ratified his secretary's action with a signed document referencing the May 8 letter. Prodromos, 148 Ill.Dec. 345, 560 N.E.2d at 946. The April and May exchange of letters, therefore, did not comply with the Illinois statute of frauds and did not form an enforceable contract, and the district court did not err in so finding. 2. Applicability of the Statute of Frauds 28 CDC also argues, albeit in somewhat cursory fashion, that the statute of frauds did not apply to the agreement between the parties because it fully performed its obligations under the contract. CDC asserts that it fully performed because, in accordance with its agreement with JMJ, it neither contacted the Rodens to seek an extension of its Option Agreement nor exercised the Option even though it had the financial ability to do so. The district court rejected CDC's argument, finding that any performance on its part pursuant to the contract was completely illusory because its forbearance from contacting the Rodens was induced by forces independent of the contract and because CDC had never intended to use its own money to exercise the option. 29 Even if we were to assume that the parties had manifested an intent to contract, we find no error with the district court's conclusion that CDC did not fully perform its obligations. Although the Illinois statute of frauds does not apply to bar enforcement of a contract that has been completely performed by one party, B and B Land Acquisition, Inc. v. Mandell, 305 Ill.App.3d 1068, 239 Ill.Dec. 500, 714 N.E.2d 58, 62 (1999), that party's performance must be done in reliance upon the agreement. Thilman & Co. v. Esposito, 87 Ill.App.3d 289, 42 Ill.Dec. 305, 408 N.E.2d 1014, 1021 (1980); see also Anastaplo v. Radford, 14 Ill.2d 526, 153 N.E.2d 37, 43 (1958); Kane v. Hudson, 273 Ill. 350, 112 N.E. 683, 684-85 (1916) (It is indispensable that the acts done in performance of the contract shall be referable to the contract alone, and to have been done in performance of it.). The evidence adduced at trial supports the district court's finding that CDC's alleged performance under the terms of the contract was illusory. Although CDC did not contact the Rodens to obtain an extension of its Option after the April and May 1997 exchange of letters with JMJ, the evidence shows that its forbearance was not motivated solely by the alleged contract. Cohen testified at trial that he knew as early as January 1997 that the Rodens would not extend the Option with CDC, and that in February he knew that the Rodens would not under any circumstances extend its option with CDC. Thus, Cohen was aware even before the Spring 1997 exchange of letters that any attempt to contact the Rodens to extend the Option would be futile. Under these circumstances, the district court did not err in finding that CDC's failure to contact the Rodens after May 1997 was not based solely on the contract and constituted illusory performance. 30 Similarly, we find no error with the court's conclusion that CDC's failure to exercise its option after the Spring 1997 exchange of letters was not motivated solely by the purported contract. As the court noted, CDC continued to pursue ways to exercise its Option even after agreeing to let Morse make a deal with the Rodens. For example, although Cohen testified at trial that CDC had the financial ability to exercise the Option if it wanted to, the record also supports a finding that CDC did not find an acceptable way to finance the property. Although Cohen explored obtaining a mortgage from Best Choice Mortgage of Minneapolis, he testified at trial that he ultimately did not pursue the mortgage because it would not have allowed him to proceed in a manner that was acceptable to the company at the time. From this evidence the district court could reasonably have determined that CDC's failure to contact the Rodens or exercise its Option was not based on its alleged contractual promise to JMJ and constituted merely illusory performance. Accordingly we find no error with the district court's conclusion that CDC did not perform all of its obligations under the contract and that the statute of frauds barred CDC's breach of contract claim.