Snyder v. Snyder

FISCHER, Judge. This is an appeal from a February 5, 1988 order of the Circuit Court for Baltimore County appointing a trustee for the purpose of executing a deed to transfer title in a parcel of real property from appellant, Kenneth William Snyder, to Mr. Snyder and his wife, Lisa Snyder, appellee, as tenants by the entireties. That order also voided a $5,000 promissory note Mr. Snyder executed for the benefit of Mrs. Snyder. Mrs. Snyder filed suit against appellant claiming breach of an oral contract to transfer the subject parcel valued, as of May, 1984, between $90,000 and $106,000.

Specifically, she sought to change the title of the Baltimore County dwelling at 18720 Upper Beckleysville Road from Mr. Snyder’s name to both names. Mr. Snyder disputed the existence of the oral contract and argued that, even if the contract existed, the Statute of Frauds, Md. Real Prop.Code Ann. § 5-104 (1988) rendered it unenforceable. The circuit court found that the oral agreement existed and that the Statute of Frauds, Md.Ann.Code art. 39C, § 1 et seq. (1986), did not operate to bar its enforceability.

I. In November, 1983 appellee and appellant became engaged. After some discussion, they agreed to purchase the home occupied by Mr. Snyder during his previous marriage. Together, the parties secured a mortgage for $57,000 in order to acquire the share of the property owned by Mr. Snyder’s first wife. Settlement occurred on May 16, 1984.

Mrs. Snyder paid over $2,800 in costs at settlement and half of the mortgage payments from June 1984 to June 1985. ⁴⁵¹ In view of Mrs. Snyder’s monetary contribution, Mr. Snyder gave her a promissory note in the amount of $5,000. This note was to ensure Mrs. Snyder’s recoupment of her expenditures if they did not marry, and Mr. Snyder failed to assign legal interest in the property to her or if he died before their marriage. Both the deed and deed of trust were titled in Mr. Snyder’s name alone. By doing so, the parties hoped to escape transfer taxes, which would accrue if the property were in both names prior to marriage.

A handwritten mortgage application shows that the parties contemplated titling the property in both names as tenants in common. A subsequent and superseding typed application indicates a desire to title the property only in Mr. Snyder’s name. The parties married in September, 1984. Thereafter, however, Mr. Snyder refused to retitle the property in both names despite his premarital oral agreement to do so.

They separated in June, 1985, and, on October 28, 1985, Mrs. Snyder filed suit in circuit court to enforce the oral agreement. To avoid the Statute of Frauds Mrs. Snyder advanced four theories: (1) the agreement could be completed within one year, (2) sufficient memoranda existed, (3) there was part performance, and (4) Mr. Snyder was estopped from asserting the Statute of Frauds as a defense. The trial court found that an oral agreement existed and held that the agreement was outside the Statute of Frauds because performance was possible within one year. The court also ruled that even if the statute were applicable, it was satisfied by certain written memoranda.

The trial judge did not reach Mrs. Snyder’s remaining contentions.

II

The first question before us is whether the judge correctly concluded that the agreement was outside the statute. The court below relied exclusively on Griffith v. One Investment Plaza, 62 Md.App. 1 , 488 A.2d 182 (1985). There, a real estate broker sued for commissions owed ⁴⁵² under an oral employment agreement. At issue was Md. Ann.Code art. 39C, § 1 which provides: No action may be brought: (3) Upon any agreement that is not to be performed within the space of one year from the making thereof: Unless the contract or agreement upon which the action is brought, or some memorandum or note of it, is in writing and signed by the party to be charged, or some other person lawfully authorized by him.

We concluded in Griffith that, because the employment agreement could conceivably be performed within one year, it was not governed by § 1 of the Statute of Frauds. The alleged agreement in the present case is likewise outside the scope of § 1 because performance was capable within oné year. This, however, is not the end of our inquiry because the contract at issue here was for the transfer of real property. Consequently, we must examine § 5-104 of the Real Property Article, which provides: No action may be brought on any contract for the sale or disposition of ... any interest in or concerning land unless the contract on which the action is brought, or some memorandum or note of it, is in writing and signed by the party to be charged or some other person lawfully authorized by him.

It is clear that Section 5-104 governs the contract between Mr. and Mrs. Snyder, and, therefore, the judge below incorrectly ruled that it was outside the Statute of Frauds.

III

We next turn to the circuit court’s alternative conclusion that sufficient memoranda existed to satisfy the statute. The Court of Appeals, in Sinclair v. Weber, 204 Md. 324, 332 , 104 A.2d 561 (1954) set forth the general rule for determining when a writing is sufficient: ⁴⁵³ [A] memorandum, in order to make enforceable a contract within the Statute of Frauds, may be any document or writing, formal or informal, signed by the party to be charged or by his agent actually or apparently authorized thereunto, which states with reasonable certainty ... (3) the terms and conditions of all the promises constituting the contract and by whom and to whom the promises are made. Initially, the circuit court relied upon the handwritten loan application wherein the parties contemplated titling the property as co-tenants.

It, however, was supplanted by a subsequent typed application indicating their intent to title the property in Mr. Snyder’s name alone. Reading the two applications together, as we must, we conclude that they do not state with reasonable certainty “the terms and conditions of the promises constituting the contract.” Id. The mortgage applications, therefore, do not constitute sufficient memoranda. The circuit court also relied upon the promissory note executed by the parties which stated: In view of value received, this note for $5,000.00 is instituted.

In the event of my [appellant’s] death, the face amount is to be paid from my estate as soon as legally possible. In view of an intended marriage between Kenneth William Snyder and Lisa Anne Naylor, this note is null and void upon marriage and the assigning of legal interest in real property known as 18720 Upper Beckleysville Road, Hampstead, Maryland 21074 to Lisa Anne Naylor. If for any reason the intended marriage is not consummated this note is payable upon demand. Mr. Snyder signed and dated this note on May 16, 1984.

It does not indicate what interest in the subject property Mrs. Snyder was to receive. Although the note refers to a possible event that is evidence of the contract, it does not state with reasonable certainty the terms of the contract. Accordingly, we believe that the trial court erred in holding ⁴⁵⁴ there were memoranda sufficient to satisfy the Statute of Frauds.

IV

Having concluded that the agreement sought to be enforced was within the Statute of Frauds and that the writing requirement was not satisfied, we must next consider whether, as Mrs. Snyder contends, there was sufficient part performance to remove the bar of the statute. “The law is clear and well established that ‘part performance’ is an equitable doctrine available only where the principal relief sought is specific performance of the oral agreement. It has no application in an action at law for money damages.” Winternitz v. Summit Hills, 73 Md.App. 16, 23 , 532 A.2d 1089 (1987), cert. denied, 312 Md. 127 , 538 A.2d 778 (1988) (part performance inapplicable in action at law by tenant against landlord for breach of an oral lease agreement and breach of an oral assignment agreement). See also Mangione v. Braverman, 234 Md. 357, 360 , 199 A.2d 225 (1964) (action at law to recover for breach of an oral agreement to convey realty); Kline v. Lightman, 243 Md. 460, 472 , 221 A.2d 675 (1966) (action at law to recover on an oral contract of guaranty). Part payment in conjunction with possession, and especially in conjunction with possession and substantial improvements, constitutes part performance, which, despite the Statute of Frauds, renders enforceable an oral agreement to sell land.

Bauer v. Hamill, 188 Md. 553, 566 , 53 A.2d 399 (1947); Serio v. Von Nordeck, 189 Md. 388, 391-92 , 56 A.2d 41 (1947) (oral agreement to convey realty held to be specifically enforceable since buyer made part payment, took possession, and made extensive repairs to the house); Soehnlein v. Pumphrey, 183 Md. 334, 336 , 37 A.2d 843 (1944) (successful suit, by buyer, for specific performance of oral agreement to convey realty where buyer made part payment, took possession, undertook to paint, excavate, weatherstrip, and screen the house, to erect a garage and chicken coops, to construct a driveway and to plant ⁴⁵⁵ shrubs and trees); Allers v. Klein, 161 Md. 194, 203 , 155 A. 420 (1931) (oral modification of written agreement for sale of realty held to be enforceable since buyers, plaintiffs, made part payment and took possession); Gorsuch v. Kollock, 139 Md. 462, 467, 470 , 115 A. 779 (1921) (suit by buyer for specific performance of oral agreement to convey realty where buyer made full payment, took possession, and constructed both a concrete plant and an equipment shed). In Bauer v. Hamill, supra, for example, Hamill, a committee for an incompetent, sold real estate by public auction to the Slusses for $3,700. Before ratification of the sale, the Slusses agreed, in writing, to sell to Bauer their inchoate equitable interest in the property for $6,500. The Bauers paid $1,000 as down payment.

At the Slusses’ request, Hamill entered the Bauers’ names on the deed as substitute purchasers of the property. The Bauers paid Hamill $3,700. The court then ratified the sale to the Bauers. In addition to paying the Slusses $1,000, the Bauers took possession and refused to vacate.

They then brought an action to force Hamill to deliver a deed conveying the property to themselves. In short, the Bauers sought to avoid their agreement with the Slusses and pay $3,700 directly to Hamill, rather than $5,500 to the Slusses. The Court of Appeals held that, even if the writings were insufficient to satisfy the Statute of Frauds, the Bauers’ payment of $1,000 to the Slusses and assumption of possession constituted part performance sufficient to render specifically enforceable the oral agreement. Bauer, 188 Md. at 566-67 , 53 A.2d 399 .

In Boehm v. Boehm,