Sales and Leases - A Problem-based Approach, 2016a

5.3.2. The admission exception: If a party to an agreement that does not satisfy the statute
of fraud admits the existence of a contract in its pleadings, testimony, or other court
proceedings, the contract is enforceable under UCC § 2-201(3)(b) up to the quantity of
goods admitted.
Problem 5-5. On October 1, Bonnie, a student, orally agreed to purchase her roommate
Stephanie’s car for $6,000. When Stephanie tendered the car, Bonnie refused to pay, saying that
her boyfriend, a law student, told her that the contract was not enforceable because it was not in
writing.
(1) Stephanie sued Bonnie, alleging:
A. On October 1, plaintiff offered to sell her car to defendant.
B. On October 1, defendant accepted the offer and promised to pay plaintiff
$6,000 for the car.
C. On October 3, plaintiff tendered the car and defendant refused to pay for it.
D. The market value of the car is $5,600.
E. Wherefore plaintiff is damaged in the amount of $400.
How should Bonnie answer the complaint?
(2) Alternatively, suppose Bonnie was questioned in a deposition as follows:
Q: Did you and Stephanie talk about purchasing her car on October 1?
A: Yes.
Q: And she offered to sell it to you for $6,000?
A: Yes.
Q: And you accepted that offer?
A: Yes.
Will Bonnie prevail in her statute of frauds defense?
5.3.3. The performance exception: Under UCC § 2-201(3)(c), an agreement for the sale of
goods for $500 or more not otherwise satisfying the statute of frauds will nonetheless be
enforced if there has been performance, either in the form of payment for goods or
acceptance of goods. Many other defenses to contract formation make the contract
voidable, so that a party can assert the defense even if they have performed. But if you
accept the goods or pay for them, you lose your right to later assert the statute as a
defense. This makes sense, for if the purpose of the statute is to prevent fraud, a person
should not be able to in effect admit they made a contract by performing it, and then deny
it.
72