Gladys Green, defendant, negotiated the sale of a parcel of land to the Hickeys, plaintiffs. The parties reached an oral agreement, in which the plaintiffs paid the defendant a $500 deposit as consideration. The plaintiffs indicated that they wanted the property to build on it and would sell the defendant’s old home on the property. In little under ten days after paying the deposit, the plaintiffs sold their house. The defendant then proceeded to tell the Hickeys that she no longer intended to sell them the property and that she had found another buyer. The plaintiffs offered to match the other buyer’s price for the property, but Green declined. The Hickeys then brought an action of suit against Green seeking specific performance of the oral agreement. Green contended that specific performance was not enforceable because the oral agreement failed to comply with the Statute of Frauds.
The trial court held in favor of the plaintiffs and granted specific performance. The defendant now appeals.
The issue is whether an oral contract for the sale of land can be specifically enforced under the Statute of Frauds if the party seeking specific performance detrimentally relied upon the oral agreement by selling their home.
A contract for the transfer of an interest in land may be specifically enforced notwithstanding failure to comply with the Statute of Frauds if it is established that the party seeking enforcement, in reasonable reliance upon the oral contract, and on the continuing assent of the party against whom enforcement is sought, has so changed his position that injustice can be avoided only be specific performance.
First off, the court noted Massachusetts law providing relief (specific performance of a contract) for parties that detrimentally relied upon an oral contract and the other party of the contract. In addition, Massachusetts case precedent hold that specific performance is applicable when the effect of all the facts in combination are considered and the aforementioned elements of the rule are proven. In other words, if the facts show that the party seeking specific performance of the contract reasonably relied upon the contract and good faith of the other party to their own detriment, specific performance is enforceable under the Statute of Frauds. Here, the facts clearly support the plaintiffs’ position that they detrimentally relied upon the oral contract with Green, upon which they gave $500 of consideration. Furthermore, the court stated that the modern trend favors the enforcement of specific performance when the circumstances warrant it, e.g. Fisher v. MacDonald. Like Fisher, the purchasers in this case put consideration in money upon reliance of the contract and, therefore, specific performance is warranted. Furthermore, Orlando v. Ottaviani provides another example of a purchaser granted specific performance after relying upon an oral promise to convey a particular strip of land. This case represents a relatively simple instance of when specific performance is warranted according to an oral contract under the Statute of Frauds. The vendor, Green, knew that the plaintiffs planned to sell their old home after purchasing the tract of land from her. The Hickeys moved rapidly in selling their home after giving a check for $500 to the defendant and. nonetheless, Green failed to perform her end of the oral contract. She did not deny the oral contract being formed or abandoning the agreement after learning of a better opportunity. Therefore, she could be liable to the plaintiffs for the full purchase price or specific performance if they have already sold their home or are still under an obligation to do so, as this would represent a severe injustice on their part. On the other hand, if the plaintiffs can rescind the sale of their home, Green will be liable for restitution instead of specific performance.
The court remanded the case for further proceedings in accordance with the opinion.