On appeal from the Superior Court of New Jersey, Chancery Division, Monmouth County, MON-C-283-01.
Before Judges Ciancia, Alley and Coleman.
The opinion of the court was delivered by: Ciancia, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Plaintiffs James P. and Tara M. McBarron, husband and wife, appeal a summary judgment dismissing their complaint against defendants Kipling Woods L.L.C. (Kipling Woods) and Barry Jost. Plaintiffs sought to enforce an oral contract to purchase unimproved land from defendants. We are satisfied that there were issues of material fact that precluded disposition of the case on summary judgment. Brill v. Guardian Life Ins. Co. of America., 142 N.J. 520, 540 (1995).
Effective January 5, 1996, the Statute of Frauds was amended to eliminate the requirement that a contract for the sale of real property must be in writing. L. 1995, c. 360, § 4. N.J.S.A. 25:1-13 now provides:
An agreement to transfer an interest in real estate or to hold an interest in real estate for the benefit of another shall not be enforceable unless:
a. a description of the real estate sufficient to identify it, the nature of the interest to be transferred, the existence of the agreement, and the identity of the transferor and transferee are established in a writing signed by or on behalf of the party against whom enforcement is sought; or
b. a description of the real estate sufficient to identify it, the nature of the interest to be transferred, the existence of the agreement and the identity of the transferor and the transferee are proved by clear and convincing evidence.
The problem in the present case is that the parties agreed that some document was to be drawn up, but defendants reneged on the transaction before that occurred. The trial court acknowledged that the issues turned on the intent of the parties. It concluded, however, that"plaintiffs have only shown, at best, an oral agreement conditioned upon the drafting and execution of a written agreement." Because both parties agreed that a form of writing was anticipated, the trial court concluded there was no valid oral contract.
Plaintiffs correctly point out that the mere anticipation of a written memorialization of an oral agreement does not as a matter of law vitiate an oral contract if the elements of a contract are contained in the oral agreement.
Over forty-five years ago, Judge Conford, joined by Judges Goldmann and Freund, stated:
On this appeal, however, plaintiff's principal contention is that the parties did not intend to be bound at all unless a formal contract were drawn and executed; and since that contingency never eventuated plaintiff was free at any time and for any reason to terminate the negotiations and have her deposit back.... However, parties may orally, by informal memorandum, or by both agree upon all the essential terms of a contract and effectively bind themselves thereon, if that is their intention, even though they contemplate the execution later of a formal document to memorialize their undertaking. See [Stuart & Wood, Inc. v. Palisades Prop. & Operating Corp., 109 N.J. Eq. 401, 404 (Ch. 1931).]; Zuendt ...