Facts: Mr. Smith gives Ms Jones a check for $5000 as option to purchase her land
ID: 1110775 • Letter: F
Question
Facts: Mr. Smith gives Ms Jones a check for $5000 as option to purchase her land located in Napa Valley - both parties sign the option to buy contract - Ms Jones accepts the check for $5000 as an option to buy her land. Ms Jones agreed to sell to Mr. Smith her 2 acre commercial lot for $300,000. Mr. Smith has 90 days to exercise his option to purchase Ms Jones property at her asking price of $300,000.
QUESTION: Changing the facts a little - Mr. Smith & Ms. Jones agree on an option contract; Mr. Smith gives Ms. Jones a check for $5000; however, they never bother to put the deal in writing? Thirty days into this oral agreement - Ms. Jones decides to take another higher offer and sell her property to someone else.
Explanation / Answer
As per the statute of fraud, a contract dealing with the buy and sell of land should be in writing with sufficient content that proves to be a contract of buy and sell. Further, the statute of frauds requires a contract in writing if the value of the good is more than $500.
Above statutes are applied in the given case and contract should be in writing to make it enforceable. Since, the contract is not in writing and it is an oral contract, then it will be evaluated on the basis of the doctrine of part performance. In this case, the doctrine of part performance is proved because Mr. Smith has paid the price of option and Ms. Jones has accepted it. Hence, part performance has taken place.
Therefore, Ms. Jones cannot sell it to other parties before the completion of the three months as per the agreed terms of contract.
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