Opinion ID: 2638709
Heading Depth: 4
Heading Rank: 2

Heading: McHale's alleged promise

Text: Valdez Fisheries' third-party complaint alleged that Alyeska's McHale promised in a January 1994 conversation with David Cobb, Valdez Fisheries' business manager, that if Alyeska approved [Valdez Fisheries'] proposal as best meeting Alyeska's requirements, Alyeska would lease the facility from [Valdez Fisheries]. [35] Alaska's statute of frauds renders certain agreement[s], promise[s], or undertaking[s] ... unenforceable unless [they are] in writing.... [36] The alleged oral promise at issue here falls under the statute of frauds because it is an agreement for leasing for a longer period than one year ... or of any interest in real property.... [37] The RESTATEMENT (SECOND) OF CONTRACTS provides that promissory estoppel can bind a promisor notwithstanding the statute of frauds. [38] In Alaska Democratic Party v. Rice, we endorsed this view as to employment contracts. [39] We explicitly limited this holding to employment contracts, perhaps in recognition of the frequency of oral employment agreements and the extent to which the main terms of an employment contract are generally well understood. [40] The present case is markedly different because the duration of the alleged promise is indiscernible. The statute of frauds serves many purposes. First, it provides certain, consistent, and predictable principles to guide negotiators. [41] It recognizes the inherent evidentiary worth of written evidence, and the potential injustice created by relying on the memories of interested parties to provide the exact language of an agreement, which is necessary to discern the limits of the promise. [42] It also recognizes the natural tendency of peoples' memories to contour the words they recall to fit their understanding of the agreement. [43] The statute of frauds encourages people to commit their agreements to writing, and the process of putting the agreement in writing helps impress upon them the importance of their agreements. [44] It reduces litigation over alleged oral contracts. [45] Finally, a limited application of exceptions to the statute of frauds preserves the legislative intent behind the statute, and gives effect to the legislative judgment that the benefits conferred by the statute outweigh the potential injustice produced by its application. [46] The facts here implicate the concerns motivating the statute of frauds. We therefore decline to extend Alaska Democratic Party to cases involving the sale or lease of real estate, in which the purported oral agreement is ambiguous as to key terms. In such circumstances, promissory estoppel cannot be used to defeat the statute of frauds' requirement that a writing memorialize the parties' agreement. We therefore affirm the superior court's dismissal of Valdez Fisheries' promissory estoppel claims as to the oral promise.