Court Opinion

ID: 5691168
Source: CourtListenerOpinion
Date Created: 2022-01-12 15:26:48.557934+00
Date Added: 2024-06-11T08:40:08.620300
License: Public Domain

Goldstein, J., dissents and votes to affirm, with the following memorandum:
There are two basic issues in this case, to wit, whether the memorandum contains sufficient information to satisfy the statute of frauds, and whether the memorandum was signed by the party to be charged.
The memorandum dated August 7, 2002, is addressed to the defendant Howard Y. Jang and Young H. Jang stating that the subject property was to be sold to Farideh Atai at a price of $1,800,000, “All Cash” with closing “30-60 Days,” commission of $50,000 to be paid by the seller. The memorandum stated that it was executed “in order to proceed with a contract of sale.” After Howard Jang signed the memorandum Mrs. Atai changed the name of the purchaser to Farid Investment, a limited partnership based in the State of Colorado.
The subject property was in fact owned by the defendant Dogwood Realty of N.Y., Inc. (hereinafter Dogwood). Howard Y. Jang is a shareholder of Dogwood. Young H. Jang, who owns 50% of the shares of Dogwood, is mentioned in the memorandum as an addressee but did not sign the memorandum.
In response to the plaintiffs’ action, inter alia, for specific performance and to recover damages sounding in fraud, the defendants pleaded the statute of frauds and moved for summary judgment dismissing the complaint. The plaintiffs, in opposition, claimed that there were triable issues of fact as to whether Howard Y. Jang as an officer of Dogwood had the authority to act on behalf of Dogwood.
*700The Supreme Court granted summary judgment to the defendants on the ground that the memorandum did not satisfy the statute of frauds. The majority would find that the question of whether the memorandum satisfies the statute of frauds constitutes a triable issue of fact for the jury to resolve.
“[T]he adequacy of a writing for Statute of Frauds purposes . . . must be determined from the documents themselves, as a matter of law” (Bazak Intl. Corp. v Mast Indus., 73 NY2d 113, 118 [1989]; see Scheck v Francis, 26 NY2d 466, 472 [1970]). “Consideration of parol evidence in assessing the adequacy of a writing for Statute of Frauds purposes would otherwise undermine the very reason for a Statute of Frauds in the first instance” (Bazak Intl. Corp. v Mast Indus., supra at 118). A memorandum evincing a contract for the sale of real property (see General Obligations Law § 5-703) must “designate the parties, identify and describe the subject matter and state all of the essential terms of the agreement” (Bhutta Realty Corp. v Sangetti, 165 AD2d 852, 853 [1990]). On its face, the memorandum did not set forth essential terms of a contract for the sale of real property (see DeMartin v Farina, 205 AD2d 659, 661 [1994]).
The law is well settled that pursuant to the statute of frauds a “memorandum of a contract for a sale of land must identify by name or description the parties to the transaction, a seller and a buyer” (Irumor Corp. v Rodewald, 253 NY 472, 475 [1930]; see Villano v G & C Homes, 46 AD2d 907 [1974]). The instant memorandum failed to satisfy these basic criteria. The memorandum did not identify the owner of the property and the name of purchaser was changed after Howard Y. Jang signed it.
In addition, the memorandum made no mention of the quality of title to be conveyed, adjustments for taxes paid by the sellers, or the risk of loss prior to the closing. Further, there was no agreement as to the amount of the contract deposit (see Gibraltar Estates v U.S. Bank, 5 AD3d 728, 729 [2004]), which is an essential term of a contract for the sale of real property (see Parisi v Harman, 150 AD2d 946, 947 [1989]).
The memorandum stated that the parties contemplated the subsequent execution of a formal “contract of sale.” It is evident from the face of the document that the parties did not intend that the memorandum “evidence the entire agreement” (Behar v Mawardi, 268 AD2d 400, 401 [2000]).
Although some of these facts standing alone would be insufficient to deem the memorandum unenforceable pursuant to the statute of frauds, the totality of the circumstances mandates *701the conclusion that the memorandum failed to satisfy the statute of frauds and is unenforceable (see O'Brien v West, 199 AD2d 369, 371 [1993]; Sheehan v Culotta, 99 AD2d 544 [1984]).
It should also be noted that the appellants acknowledge in their brief that Howard Y. Jang “signed the contract as the individual seller,” and there is no indication on the face of the memorandum that Howard Y. Jang signed in a representative capacity (see Bridgeview Dev. Corp. v Hooda Realty, 145 AD2d 457 [1988]). In order to be enforceable, a writing must be “subscribed by the party to be charged, or by his lawful agent thereunto authorized by writing” (General Obligations Law § 5-703 [2]). As a general rule, a corporation cannot be bound to a document unless it is either named within it or its officer has signed in a representative capacity (see Bridgeview Dev. Corp. v Hooda Realty, supra).
On the question of whether Howard Y. Jang was authorized to sign the memorandum on behalf of the corporation, extrinsic evidence is admissible (see Karnal v Horovitz, 187 Misc 851, 855 [1946], affd 272 App Div 796 [1947]). On a motion to dismiss a complaint for failure to state a cause of action, an allegation that the signatory of an agreement as president and sole shareholder of the owner corporation was authorized to sign on the corporation’s behalf gives rise to a presumption that the authorization was in writing as required by General Obligations Law § 5-703 (2) (see Karnal v Horovitz, supra at 855).
However, the instant case involves a motion for summary judgment, not a motion to dismiss the complaint wherein all allegations in the complaint must be accepted as true (see Leon v Martinez, 84 NY2d 83 [1994]). There was no writing authorizing Howard Y. Jang to sell the subject property as agent for Dogwood (see Urgo v Patel, 297 AD2d 376, 377 [2002]; Diocese of Buffalo v McCarthy, 91 AD2d 213, 218 [1983]). The memorandum itself is addressed to Young H. Jang and thus acknowledges her involvement (see Kursh v Verderame, 87 AD2d 803 [1982]). Therefore, it appears from the face of the agreement that it is not signed by the parties to be charged (see Bhutta Realty Corp. v Sangetti, supra at 853), nor is there any basis in this record to pierce the corporate veil (see Raleigh Assoc. v Jackson, 96 NYS2d 528, 531 [1950], affd in part sub nom. Raleigh Assoc. v Henry, 277 App Div 978 [1950]).
The plaintiffs’ cause of action sounding in fraud is merely an effort to avoid the consequences of the statute of frauds by recharacterizing the claim as sounding in fraud (see Gora v Drizin, 300 AD2d 139 [2002]). Since the memorandum is unenforceable, the plaintiffs cannot recover damages arising from the fact that the sale did not proceed to closing.