Scoular Co. v. Denney
151 P.3d 615 · Colorado Court of Appeals · 2006
Facts
Denney, a grain farmer, orally offered to sell millet to Scoular, a grain company. Scoular, without notifying Denney, sold the millet to a third party, then later sent Denney a written contract which Denney never signed. When the market price for millet trebled, Denney delivered his crop elsewhere, leading Scoular to sue for breach of contract.
Issue
Did Denney's oral offer create a binding contract, and did Scoular's sale of millet to a third party constitute acceptance, or was a later phone call acceptance, and if so, was the contract enforceable under the Statute of Frauds?
Holding
The court reversed and remanded, finding Denney's oral offer was revocable and Scoular's sale to a third party was not acceptance. The trial court must determine if a contract was formed during a subsequent phone conversation, in which case the merchant exception to the Statute of Frauds would apply.
Rule
An oral offer, unless written and signed as a firm offer under UCC § 4-2-205, is revocable. Acceptance by performance under UCC § 4-2-206 requires an unambiguous expression of intent to be bound, which a third-party sale without notification does not satisfy. The merchant exception to the Statute of Frauds (UCC § 4-2-201(2)) can validate an oral contract if a written confirmation is sent and not objected to.
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