22 Rev. Litig. 69

When Actions Speak Louder Than Words: The Case for a Quasi-Estoppel Exception to the Statute of Frauds

James H. Stilwell

This article argues for a quasi-estoppel exception to the statute of frauds. The term “quasi-estoppel” refers to a situation in which a party is prevented from asserting a right that is inconsistent with a position previously taken by the party. In Texas, as in many other states, the statute of frauds requires certain agreements to be in writing. The goal of the statute of frauds is to prevent fraud. Texas courts have carved out exceptions by finding certain oral agreements to be valid even if a written contract was legally required. The key that courts have looked for in those situations is some action by the parties that indicates the existence of an oral contract despite the absence of a written contract.

Texas case law suggests that a quasi-estoppel exception to the statute of frauds should be recognized, because courts have recognized other circumstances in which it would not be equitable to enforce a literal interpretation of the statute of frauds. The article also provides pointers to practicing litigators for how to plead quasi-estoppel as an affirmative defense. Actions can often speak louder than words, and quasi-estoppel should be recognized in equity so that it does not nullify a legitimate handshake deal.

 

   I. Introduction: Equity Speaks Softly and Wins in the End. n1 Good advice for the congenial entrepreneur or consultant is to "get it in writing." Although many in society stand by their word and are willing to operate on handshakes or verbal promises, dishonesty abounds. While oral contracts are often valid, legislatures have enacted statutes commonly known as "statutes of frauds" that require certain types of contracts to be in writing and signed to be enforceable. This is the law in Texas. n2    However, "it would be a narrow conception of jurisprudence to confine the notion of "laws' to what is found written on the statute books." n3 Because statutes of frauds themselves may be instruments of fraud, judicially created exceptions to these statutes, lodged in equity, thrive. Texas courts have recognized circumstances where equity should, and does, uphold the validity of a contract despite the lack of a writing, even when a writing appears to be required by statute. One common thread runs through these judicial exceptions: action. Courts act to prevent injustice when the parties' actions evidence the existence of a contract despite the absence of a writing. Put differently, sometimes actions speak louder than words.    This Article examines the Texas law pertaining to the statute of frauds and makes the case for a quasi estoppel exception to the statute of frauds. Part II examines the law of quasi estoppel and the statute of frauds. After the purpose and reasoning behind the statute of frauds has been addressed, Part III looks at the two Texas appellate opinions that indirectly support a quasi estoppel exception to the statute of frauds. Because neither case is a straightforward endorsement of a quasi estoppel exception to the statute of frauds, Part IV explores three parallel exceptions to the statute that have been recognized by Texas courts. Concluding that a solid argument exists for the extension of the law to recognize a quasi estoppel exception to the statute of frauds, Part V accordingly provides the practicing litigator with suggestions: pointers on pleading a quasi estoppel exception to the statute of frauds, guidance for understanding the burden of proof, and proposed arguments concerning the question of whether the determination of the fulfillment of the exception should be for the judge or the jury.    When an otherwise gregarious client sits in your office expounding regret over not having "gotten it in writing," depending on the circumstances, all may not be lost. While there is no substitute in law for a signed, written contract, in equity the action of the parties just may do. Actions sometimes speak louder than words. Quasi estoppel may prevent the statute of frauds from nullifying the client's handshake deal.    II. Quasi Estoppel and the Statute of Frauds Quasi estoppel is a species of estoppel n4 created by equity n5 that acts as an affirmative defense n6 and, by its assertion, may prevent injustice. n7 According to Black's Law Dictionary:    "Estoppel" means that party is prevented by his own acts from claiming a right to detriment of other party who was entitled to rely on such conduct and has acted accordingly. A principal that provides that an individual is barred from denying or alleging a certain fact or state facts [sic] because of that individual's previous conduct, allegation, or denial. A doctrine which holds that an inconsistent position, attitude or course of conduct may not be adopted to loss or injury of another. n8 Quasi estoppel, as the word "quasi" indicates, n9 resembles estoppel but bears a material difference: it requires less proof. While other forms of estoppel require proof of a false representation and proof of detrimental reliance on that false representation, n10 quasi estoppel does not. n11 It could as easily be called "estoppel light."    Quasi estoppel precludes a party from asserting, to another's disadvantage, a right that is inconsistent with a position previously taken. n12 It is applied where it would be unconscionable to allow a party to maintain a position inconsistent with one in which it acquiesced, or from which it accepted a benefit, n13 and precludes a party from accepting the benefits of a transaction and subsequently taking an inconsistent position to avoid corresponding obligations. Unlike other forms of estoppel, quasi estoppel does not require a showing of a false representation or detrimental reliance. n14    In and of itself, quasi estoppel is not a new concept; it is an antique. n15 The form of estoppel called "quasi estoppel" was expressly recognized and set forth by the Supreme Court of the United States at the end of the nineteenth century in Simmons v. Burlington, Cedar Raids & Northern Railway. n16 In Simmons, the U.S. Supreme Court, in discussing acquiescence of a party to a transaction, set forth the equitable doctrine of quasi estoppel, quoting Pomeroy's Equity Jurisprudence as follows:    "Acquiescence is an important factor in determining equitable rights and remedies in obedience to the maxims: He who seeks equity must do equity, and he who comes into equity must come with clean hands. Even when it does not work a true estoppel upon rights of property or of contract, it may operate in analogy to estoppel may produce a quasi estoppel upon the rights of remedy." n17 Despite the veritable antiquity of the doctrine of quasi estoppel, this Article discusses a use for quasi estoppel that is cutting edge application of quasi estoppel as an exception to the much maligned n18 statute of frauds. n19    The statute of frauds n20 is a legislative attempt to resolve the question of when an agreement must be in writing and signed in order to be enforceable. n21 Because inequity can result from the literal application n22 of a statute of frauds, courts in Texas have recognized a number of exceptions to the application of the statute. n23 Despite what appears to be a natural fit for quasi estoppel as an exception to the enforcement of the statute of frauds in Texas, no case has directly tackled the subject, and only two cases have indirectly broached the concept. n24    III. Case Discussion of Quasi Estoppel Exception to the Statute of Frauds Quasi estoppel attempts to preclude a party from asserting to another's disadvantage a right inconsistent with a position previously taken. The very nature of quasi estoppel, like other forms of estoppel, is defensive and preventative. One such use would be to estop another party from contending that an oral contract is void under the statute of frauds if the requisite inconsistent position can be proven. The U.S. Supreme Court seemed to recognize such a use in its early writing on the subject in Simmons, further quoting Pomeroy:    "When a party, with full knowledge, ... of his rights, and of all the material facts, freely does what amounts to a recognition of the transaction as existing, or acts in a manner inconsistent with its repudiation, or lies by for a considerable time and knowingly permits the other party to deal with the subject matter under the belief that the transaction has been recognized, ... there is acquiescence, and the transaction, although originally impeachable, becomes unimpeachable in equity." n25 Despite this early dicta, there are no opinions in Texas case law that directly address the application of quasi estoppel to the statute of frauds. n26 A review of the case law does reveal, however, two cases indirectly broaching the subject. Both cases address the application of quasi estoppel to contingency fee contracts.    The Texas Disciplinary Rules of Professional Conduct allow contingency fee contracts between attorneys and their clients. n27 However, one of the explicit requirements is that such a contract must be in writing and signed by the attorney and client. n28 This contingency fee contract writing and signature requirement is analogous to the requirements of the statute of frauds. n29    A. Enochs v. Brown n30 In Enochs v. Brown, the Austin Court of Appeals considered the application of quasi estoppel to an attempt to void a contingency fee contract. n31 The case evolved out of an automobile bicycle accident that resulted in permanent brain damage to the bicycle rider, Justin Vaught, a minor. Justin's mother, Kimetha Brown, and her husband, Chris Brown, signed a contingency fee contract with the firm of Whitehurst, Harkness, & Watson. Although the Browns signed the contract, their attorney did not. n32 Throughout the course of the representation, $ 2.325 million was secured from various insurance companies in settlement proceedings. Because Justin Vaught was a minor, the court appointed a guardian ad litem, Leland Enochs, to protect his interests. n33 After a friendly suit, n34 the trial court apportioned the settlement proceedings, upheld the contingency fee contract, and awarded a one third fee on all money received on behalf of Justin Vaught. n35 The court issued findings of fact and conclusions of law, n36 including findings that Whitehurst provided valuable legal services by successfully handling the claim and that Justin (through his guardian ad litem) accepted, used, and enjoyed these services. The court concluded that, by accepting the legal services, Justin Vaught was estopped from denying the validity of the contingency fee contract. n37 The trial court further found that the attorney's failure to sign the agreement did not render it void or voidable, despite the signature requirement found in the Texas Government Code. n38    On appeal, Justin Vaught's natural father, Frank Vaught, and the guardian ad litem sought to void the contingency fee contract on the basis that it was not signed by the attorney, n39 an argument analogous to the defense of the statute of frauds to the enforcement of a contract. The attorney seeking to uphold his fee and enforce the contract argued first that quasi estoppel applied to estop the attempt to void the contract, and further argued that even if quasi estoppel did not apply, the contract was enforceable as it was signed by the party to be charged (Justin's mother, Kimetha Brown). n40    The Enochs court first addressed the quasi estoppel argument. The court considered the trial court's findings of fact and concluded that they supported the application of quasi estoppel. The court stated, "In this case, it is unconscionable for Enochs, on Justin's behalf, to challenge the validity of the contingent fee contract when Justin has accepted the benefits of Whitehurst's services." n41    The Enochs court next addressed the argument that the contingency fee was void, an argument that "were he not estopped" Enochs could have made. n42 The court made a direct comparison between the contingency fee contract requirements set forth in the Texas Government Code and the statute of frauds. The court stated:    Section 82.065(a) can be sensibly construed to operate in a manner similar to the statute of frauds. Under the statute of frauds, an agreement is enforceable if it is in writing and signed by the party to be charged. A contract is not void if these requirements are not met; rather, the statute renders the contract voidable at the option of the party against whom the contract is to be enforced. Other statutes requiring written agreements operate similarly. Both the statute of frauds and the statute of conveyances are designed to prevent fraud. Under these circumstances, we believe that section 82.065 accomplishes its purpose of guarding against fraud in contingent fee contracts by requiring the party enforcing the contract to produce a written contract signed by the party to be charged. We are convinced that the purpose of section 82.065(a) has been fulfilled in this case. n43 Although the Enochs decision is not a straightforward application of the doctrine of quasi estoppel to prevent the application of the statute of frauds, it is exceedingly close. The statute analyzed by the court was directly analogous to the statute of frauds, and had the case involved a successful three year representation based on an oral hourly attorney fee (instead of a mildly flawed contingency fee contract), the result should be the same. Enochs stands for the proposition that quasi estoppel can act as an affirmative defense to prevent the enforcement of the terms of a statute in an attempt to void a contract. Quasi estoppel can act to estop the attempt to void an otherwise flawed contract.    B. Tillery & Tillery v. Zurich Insurance Co. n44 A second case, Tillery & Tillery v. Zurich Insurance Co., considered the same theory, but the party raising the quasi estoppel affirmative defense lacked the facts to prove their claim. In Tillery & Tillery, the Dallas Court of Appeals faced another contingency fee contract dispute. Zurich Insurance Company contacted Dale Tillery about handling a medical malpractice case and a subrogation claim on a contingent fee basis. n45 Tillery sent Zurich a letter setting forth the terms of the contingency agreement, but this letter was not a contract for Zurich to sign. Tillery pursued the subrogation matters for three months before Zurich assigned them to other counsel and instructed Tillery to take no further action on that part of the claim. n46 The subrogation claims were successful, and Zurich recovered $ 143,620.96 on that aspect of the suit, which it had taken away from Tillery. n47    Tillery continued to work on the remainder of the matter, a medical malpractice claim, and eventually lost the suit, filed an appeal, and settled for no monetary consideration. n48 Tillery then proceeded to bring a claim against Zurich for one third of Zurich's recovery on the subrogation claims taken away from Tillery. The trial court held that Tillery was not entitled to one third of Zurich's recovery and made findings of fact and conclusions of law in favor of Zurich. n49    On appeal, Tillery contended that his contingent fee agreement, which he admitted did not meet the requisites of the Texas Government Code, was enforceable under the quasi estoppel theory discussed in Enochs v. Brown. The court discussed the argument, stating:     Tillery argues his contingent fee agreement with Zurich is enforceable under the reasoning of Enochs v. Brown. In Enochs, the court held a contingent fee agreement may be enforceable even though it does not meet the requirements of section 82.065. But there are two significant differences between Enochs and this case. First, the fee agreement in Enochs was signed by the client, but not by the attorney. The court applied a statute of frauds analysis to hold that a contract may be enforced under certain circumstances when it is signed by the party to be charged. Because Zurich did not sign the fee agreement at issue here, the statute of frauds analysis employed in Enochs does not apply. Second, the attorney in Enochs had completed all of the work in the underlying litigation before he sought to enforce his fee agreement. The court applied a quasi estoppel theory of recovery to conclude it would be unconscionable to allow the client to challenge an agreement he signed after accepting all the benefits of the contract. In this case, the only benefit of Tillery's services Zurich arguably accepted in the intervention case before refusing to honor the agreement was the preparation and filing of the intervention pleadings. In fact, Zurich specifically told Tillery to cease work on the intervention claim and then transferred responsibility for the case to its in house counsel. Based on the facts in this case, there is nothing unconscionable about refusing to pay Tillery a contingent fee for a case in which he only filed the original pleadings. Accordingly, we decline to extend Enochs to the facts presented in this case. n50 The Dallas Court of Appeals did not reject Tillery's legal theory, and thus did not reject quasi estoppel as an equitable means of preventing the enforcement of a statute. Rather, the Tillery & Tillery court applied the argument, but found that Dale Tillery had not fulfilled his burden of proof on the affirmative defense of quasi estoppel. The Tillery & Tillery court distinguished the Enochs result because the Tillery & Tillery plaintiff could not factually make out the elements of quasi estoppel. Although neither Enochs nor Tillery & Tillery directly endorse a quasi estoppel exception to the application of the statute of frauds, both courts examine the application of quasi estoppel as an equitable means of avoiding strict compliance with the terms of a statute spelling out requisites for enforcement of a contract. Even though the courts have not directly addressed a quasi estoppel exception to the statute of frauds, the move from these indirect applications to the adoption of such an exception is more akin to a baby step than a leap. When a party can meet the factual burden, the law appears to support quasi estoppel's defensive, preventative applications to preclude and estop another party from contending that a contract is void under the statute of frauds.    IV. Parallel Support for a Quasi Estoppel Exception to the Statute of Frauds Although no reported cases directly endorse a quasi estoppel exception to the statute of frauds, n51 Texas case law has applied other forms of estoppel to counter the application of the statute of frauds. Texas case law is clear that, upon proof of the necessary elements, both promissory estoppel and equitable estoppel can prevent the application of the statute of frauds to a particular contract. n52 These cases, by analogy, reinforce the position that under Texas law, quasi estoppel eviscerates the application of the statute of frauds, and they further support the concept that the actions that support estoppel sometimes speak louder than the words of an otherwise unenforceable oral agreement.    A. The Promissory Estoppel Exception to the Statute of Frauds Promissory estoppel is an exception to the statute of frauds n53 albeit a narrow one. n54 As one appellate court put it:    The applicability of promissory estoppel as an exception to the statute of frauds is limited to cases in which a party promised to sign a prepared, written agreement that complies with the statute of frauds. A complete agreement on the terms and wording of the written contract is required to permit the application of promissory estoppel to a statute of frauds defense. A promise to prepare a written agreement is not sufficient. n55 In "Moore" Burger, Inc. v. Phillips Petroleum Co., n56 the Texas Supreme Court analyzed a scenario in which a potential purchaser ("Moore" Burger) of a property up for auction was lulled into not bidding by a twofold set of promises: (1) a set of promises from another bidder that he would purchase the property and lease it to "Moore" Burger for a 20 year period, accompanied by the bidder's acceptance of a written lease from "Moore" Burger, which the bidder then never signed; and (2) a set of promises from the trustee actually handling the transaction that he would sign the lease, which he did not do. n57 "Moore" Burger refrained from bidding on the property at auction in reliance on these promises, not knowing that the lease was not signed. The property was purchased by the promising bidder and trustee, who did not lease to "Moore" Burger and instead sold to a third party. n58    In this case, the actions of the bidder and his trustee sufficed to take the otherwise unenforceable oral contract outside the statute of frauds. The court recognized the inequity, found that the actions, if enforced, would in essence allow the statute of frauds to work a fraud on "Moore" Burger, and allowed the promissory estoppel exception. n59    Texas case law has applied other forms of estoppel to counter the application of the statute of frauds, albeit with different elements of proof required for the different estoppel defenses. The cases on promissory estoppel discussed in this section and the cases on equitable estoppel discussed in the next section, by analogy, reinforce the position that under Texas law, quasi estoppel should prevent the application of the statute of frauds.    B. The Equitable Estoppel Exception to the Statute of Frauds The leading case on the equitable estoppel exception to the statute of frauds is Schroeder v. Texas Iron Works, Inc. n60 This Texas Supreme Court case involved an employment dispute over oral statements that allegedly modified the employment at will status of Thomas Schroeder at Texas Iron Works, Inc. n61    Mr. Schroeder alleged that his supervisor made oral statements to him giving him the impression that he would be employed by the company for eight to ten years, up until his retirement. n62 However, a contract such as this would not be capable of performance within one year of its making, placing it in violation of the statute of frauds. n63 As discussed above, the requirement of a writing typically acts to prevent attempts to enforce fictitious verbal promises.    To avoid the application of the statute of frauds, Mr. Schroeder pled the affirmative defense of equitable estoppel, which required him to prove "(1) a false representation or concealment of material facts, (2) made with knowledge, actual or constructive, of those facts, (3) with the intention that it should be acted on, (4) to a party without knowledge, or the means of knowledge of those facts, (5) who detrimentally relied upon the misrepresentation." n64 In essence, the equitable estoppel affirmative defense focuses on the acts of the parties, both in making representations and in relying on the representations.    If a preponderance of evidence of the actions of the parties exists, then the true intent of the parties, manifested through their actions, obviates the need for a written memorialization of the agreement. n65 The purpose behind the statute of frauds' attempt to avoid the enforcement of fictitious promises is fulfilled by the equitable estoppel affirmative defense through proof of the existence of the promise as reflected in the parties' actions. n66 Actions speak louder than words, and the equitable estoppel exception to the enforcement of the statute of frauds speaks loudly in support of an analogous quasi estoppel affirmative defense.        C. The Partial Performance Exception to the Statute of Frauds In addition to the support for a quasi estoppel exception to the statute of frauds found via analogy to other forms of estoppel, further undergirding can be found in the partial performance exception to the statute of frauds. Partial performance is one of the most well recognized exceptions to the writing requirements of the statute of frauds. n67 A number of Texas cases recognize a partial performance exception to the statute of frauds. n68 The partial performance doctrine provides that, even if a contract falls within the purview of the statute of frauds, it is nonetheless enforceable if the plaintiff has partially performed pursuant to the agreement such that denying enforcement would amount to a virtual fraud on the plaintiff. n69 "Virtual fraud" exists when the plaintiff acted in reliance on the agreement and suffered a detriment for which he has no remedy, and the defendant would reap an unearned benefit if the contract were not enforced. n70    An example of the partial performance exception to the enforcement of the statute of frauds is found in Welch v. Coca Cola Enterprises, Inc. n71 In that case, an individual vending machine services provider submitted a bid for a vending machine contract for a high school campus in Troup, Texas. n72 The provider, Robert C. Welch, Jr., was informed by the high school principal that he had been awarded an exclusive five year contract, and proceeded to provide machines and services to the Troup schools. n73 After performing for eighteen months, Welch was told that Coca Cola had outbid him and that he must immediately remove his machines. n74 Welch then brought suit.    After the trial court granted summary judgment for the defendants in the suit, Welch appealed. One basis for the summary judgment involved the validity of the contract, as the statute of frauds requires the contract to be signed by the person to be charged with the obligations or by someone legally authorized to sign for the party to be charged. n75 Defendants argued that the principal lacked authority to bind the school district. n76    On appeal, Welch countered with the partial performance exception to the statute of frauds, arguing that he had provided evidence to the trial court sufficient to bear the burden of proof on his affirmative defense to the enforcement of the statute. n77 Welch had provided an affidavit to the trial court stating that he had relied upon the principal's representation that he had been awarded a five year contract, that he had paid bonus payments to the schools for the first two years of the contract despite being forced to remove his machines prior to the end of the second year, and that he had purchased machines that he would not have purchased but for the agreement and did not need when the agreement was breached. n78 The court of appeals found that this testimony "raised a fact issue that the school district benefitted from these machines through the generation and payment to the district of vending machine sales commissions." n79 The court then held that "Welch raised a fact issue as to the inapplicability of the statute of frauds to the agreement in question because of part performance," n80 reversed the grant of summary judgment, and remanded the issue to the trial court. n81    In Welch, actions spoke louder than words. Although the contract may not have been enforceable under the technical requirements of the statute, the parties' behavior was what counted. For a year and a half, both parties performed as if all was well. An equitable defense, partial performance, acted to prevent the enforcement of the statute of frauds by showing persuasive evidence of the existence and terms of the contract, as well as by showing an unearned benefit to one party and a substantial detriment to the other in the instance the contract was not enforced.    Partial performance and quasi estoppel require comparable proof. The partial performance doctrine requires proof of a virtual fraud, while quasi estoppel instead requires proof of an unconscionable result. n82 Partial performance requires proof of the plaintiff's substantial detriment and the defendant's unearned benefit; quasi estoppel also requires a benefit/detriment analysis. n83 However, unlike partial performance, quasi estoppel does not focus on the plaintiff or require a showing of reliance. n84 Instead, it focuses on the defendant's acquiescence or inconsistent actions.    The partial performance doctrine is a well recognized exception to the enforcement of the statute of frauds. Its elements of proof are analogous to quasi estoppel. The existence of a partial performance exception provides a practitioner with a comparable legal position and a good faith basis to argue for the extension of existing law. n85    V. Practical Pointers for the Practicing Texas Litigator Because Texas cases discussing a quasi estoppel exception to the statute of frauds are rare, the practicing litigator will not find form books, pleading aides, model charges, or other litigator guides available for quick reference. Rather than leaving the reader in a lurch, this Article provides some practical pointers to smooth the way, including tips for: (a) pleading quasi estoppel; (b) understanding the burden of proof; and (c) providing a basis to argue the exception as a matter of law or as a question of fact. In the instance a jury charge is warranted, this Article further provides a model charge question in the Appendix.    A. Pleading Quasi Estoppel as an Affirmative Defense to the Statute of Frauds The Texas Rules of Civil Procedure identify both estoppel and the statute of frauds as affirmative defenses. n86 A party is required to set forth in its pleading all matters constituting an avoidance or affirmative defense to the opposing party's pleading. n87 Failure to plead a required matter may result in waiver of the defense. n88     Practically speaking, and presuming no preemptive filings, three salvos will be required to get to the quasi estoppel exception to the statute of frauds: (1) plaintiff files an original petition raising a cause of action for breach of an oral contract; (2) defendant files an original answer, likely with a general denial, that includes the assertion of the statute of frauds as a defense to the enforcement of the oral contract; and (3) plaintiff files a first amended petition alleging that the defendant's acts fulfill the elements of quasi estoppel and that the defendant should be estopped from seeking to render the oral contract void via the statute of frauds. Assuming that the facts merit the allegation, n89 it is entirely possible that the defendant could fire off a return fusillade by filing a first amended answer adding the doctrine of "unclean hands." n90    Although the Texas Rules of Civil Procedure are interpreted liberally, n91 and the Texas Supreme Court has adopted a "fair notice" standard with respect to pleadings, n92 it is safer to err on the side of saying too much about quasi estoppel than not enough, particularly because the law on it is sparse. A sample pleading by a plaintiff seeking to enforce an oral contract by invoking quasi estoppel to prevent the application of the statute of frauds might state:    AFFIRMATIVE DEFENSE: QUASI ESTOPPEL    Plaintiff further pleads the affirmative defense of quasi estoppel. Defendant 's prior conduct in doing X, Y, and Z establishes Defendant's position that the oral contract is valid and estops Defendant via quasi estoppel from denying its validity. It would be unconscionable to allow Defendant to claim the oral contract is invalid under the statute of frauds and attempt to avoid the obligations under the contract after Defendant has acquiesced to the validity of the contract and accepted a benefit under it.    B. The Burden of Proof on the Quasi Estoppel Exception to the Statute of Frauds Because quasi estoppel asserted to avoid the statute of frauds constitutes an affirmative defense to an affirmative defense, the burden of proof may seem confusing. However, Texas case law has been clear about the burden in similar circumstances. When a plaintiff asserts an affirmative defense to negate a defendant's affirmative defense, the defendant bears the initial burden. Once defendant's affirmative defense has been proven, the burden shifts to the plaintiff to void the proven defense. In short, the party asserting the affirmative defense bears the burden of proof.    In Hammonds v. Calhoun Distribution Co., n93 a case involving a plaintiff's assertion of the partial performance exception to the defendant's statute of frauds defense, the Texarkana Court of Appeals properly analyzed the burden of proof. n94 Clyde Hammonds brought suit against Calhoun Distributing Company for breach of an oral lease agreement involving a Mobil service station in Denison, Texas. n95 Hammonds alleged that the oral lease for his working life expectancy of seven years was entered July 14, 1976, and that Calhoun ordered him off of the premises after one month's partial performance. n96 Calhoun answered the suit and pleaded the affirmative defense of the statute of frauds, arguing that the law required a writing and signature for a real estate lease longer than one year. n97 After some discovery, Calhoun brought a motion for summary judgment on the defense of the statute of frauds, which Hammonds opposed with claims of part performance. n98 Because the statute of frauds was Defendant Calhoun's affirmative defense, Calhoun had the burden of proof on its elements. However, once the affirmative defense was established, the burden shifted to Plaintiff Hammonds to prove his claim of part performance. n99 The court stated:    The judicial admissions and evidence make it clear that Calhoun has established its defense of the statute of frauds as a matter of law... . Hammonds is asserting part performance in an effort to avoid the statute of frauds defense which has been established by Calhoun as a matter of law. The burden was therefore on Hammonds, once Calhoun had established its statute of frauds defense ... . n100 The court then found that Plaintiff Hammonds failed to meet his burden on two of the three essential elements required to prove part performance, and accordingly found in favor of Defendant Calhoun. n101    In Flameout Design & Fabrication, Inc. v. Pennzoil Caspian Corp., n102 the Houston Court of Appeals similarly analyzed the burden of proof on an equitable estoppel claim asserted against a statute of frauds defense to enforcement of an oral contract. In this summary judgment case, Flameout Design and Fabrication, Inc. ("Flameout") brought suit against Pennzoil Caspian Corporation ("PCC"), seeking enforcement of an oral contract backed by several written communications. n103 During the course of the case, PCC filed a motion for summary judgment, which the trial court granted, on the basis of a statute of frauds defense to the breach of contract claim. n104 On appeal, Flameout contended that the trial court erred because the written communications were sufficient to satisfy the statute of frauds and, alternatively, that the two defenses of part performance and equitable estoppel defeated the enforcement of the statute of frauds. n105 The court of appeals found that the written communications were insufficient to satisfy the requirements of the statute of frauds and then discussed Flameout's affirmative defenses. n106 Part of this discussion dealt with Flameout's contention that it had been improperly made to bear the burden of proof; although the court found that Flameout had waived its objection, the court discussed who bore the burden of proof on the various defenses:    Even if Flameout had made its objection to the trial court, this issue is without merit. The applicability of the statute of frauds to Flameout's breach of contract action was established by Flameout's petition, which showed on its face that the complaint involved a contract that could not be performed within one year and was for the sale of goods for more than $ 500. Therefore, it was Flameout's burden to produce evidence that the statute of frauds was satisfied or that Flameout was subject to some exception or defense to the statute of frauds. n107    C. Arguing the Quasi Estoppel Exception as a Matter of Law or a Question of Fact Whether or not a quasi estoppel exception to the statute of frauds is a matter of law or a question of fact remains unclear. Although a preponderance of the cases discussing the statute of frauds identify the application of the statute to a particular contract as a matter of law for the court, at least two opinions raise the possibility of fact questions that must be addressed. Looking beyond the actual application of the statute of frauds, the issue of whether the elements of quasi estoppel raise questions of fact is unclear. The practicing litigator seeking to void the application of the statute of frauds should be prepared to argue that the quasi estoppel exception should be determined as a matter of law for summary judgment and directed verdict and, in the alternative, should be prepared to argue in support of a jury question on the exception so as not to waive the defense.    1. The Exception is a Matter of Law for the Court Because the concept of quasi estoppel will be even more foreign to a jury than to a judge, the skilled practitioner should seek determination as a matter of law. Cases abound in support of the proposition that whether or not a contract is within the statute of frauds is a matter of law for the court, including at least seven Houston Courts of Appeals and Texas Supreme Court cases. n108 Note, however, that resolution of quasi estoppel adds another factor into the equation. In order to determine whether or not the statute of frauds precludes the enforcement of an oral agreement, the court must first determine whether or not quasi estoppel acts to prevent the application of the statute. As discussed above, success of the affirmative defense will require proof of elements such as unconscionability and the opposing party's maintenance of a position inconsistent with one in which the opposing party acquiesced, or from which it accepted a benefit. n109 These elements appear to contain jury fodder. While the overwhelming abundance of case law inspires a solid argument for determination of the statute of frauds as a matter of law, the paucity of opinions on quasi estoppel may give a court pause.        2. The Exception is a Question of Fact for the Jury Two older cases suggest that whether or not the statute of frauds is applicable in a particular case is a question of fact that the jury should decide. n110 Both cases deal with oral agreements involving indefinite times for performance, that is, the agreements included no time element whatsoever. n111 While the agreements addressed in these cases appear distinguishable from agreements with a time factor such as "for life," "while living," "until remarried," "while the well produces," or "for the life of the project," the skilled practitioner may subtly suggest that a reversal for error in disallowing a proposed jury question merits hearing what the jury has to say.    The Fifth Circuit opinion in Cunningham v. Healthco, Inc. n112 reflects a Federal District Court's decision to allow the jury to determine the question:    As for the ongoing obligation of Healthco to provide management assistance and consulting, "the rule is that, where the time for performance is indefinite in that the agreement merely provides for the performance of a particular act or acts which can conceivably be performed within one year, the Statute of Frauds is inapplicable, however improbable performance within one year might be." The jury specifically found that each of the three contracts was capable of being performed in one year. Their finding is supported in the record, and dispositive of the issue. n113 Regardless of whether the statute of frauds is for the jury, the affirmative defense of quasi estoppel requires separate determination. Proof of the affirmative defense will require fulfillment of elements such as unconscionability and maintenance of a position inconsistent with one in which the opposing party acquiesced, or from which it accepted a benefit. n114 These elements should be argued to involve questions of fact.    Assuming that the court agrees with an argument that a quasi estoppel affirmative defense contains fact issues for the jury to resolve, a jury question on quasi estoppel becomes necessary. n115 The Texas Pattern Jury Charge, which many practitioners rely on, does not contain a question pertaining to quasi estoppel. n116 Where there is no generally accepted question, resort must be made, and heed must be given, to case law. n117 In order to aid the practitioner, the Appendix to this Article contains a sample jury question on quasi estoppel, with instruction, providing citation to existing case law for each portion of the question.    VI. Conclusion Although it may appear that Joshua's trumpets brought down the walls of Jericho, it was faith in action, not the sounds of trumpets, that did the job. Sometimes actions speak louder than words. In representing a client seeking to enforce an oral contract that on its face appears to violate the statute of frauds, the practicing litigator should carefully examine the various exceptions to the enforcement of the statute. Although not yet recognized as an exemption under Texas jurisprudence, Texas case law strongly supports the application of a quasi estoppel affirmative defense to prevent the enforcement of the statute of frauds.    A small spark on dry tinder can erupt into a consuming flame. However, it takes the right tinder and proper guidance of the spark. Quasi estoppel may provide the proper tinder to burn away a statute of frauds defense. An exception to the enforcement of the statute of frauds does not exist for every oral agreement, but where it does, it still takes proper guidance to nourish the spark into a consuming verdict.    This Article has analyzed the law in Texas pertaining to the statute of frauds and set forth a strong case for a quasi estoppel exception to the statute of frauds. The Article has provided an in depth examination of the law of quasi estoppel, the statute of frauds, and three parallel exceptions that have been recognized by Texas courts. A solid basis exists for the extension of the law to recognize a quasi estoppel exception to the statute of frauds. This Article has further provided practical guidance for a litigator building a case. Nourishing the argument requires proper pleading, developing the evidence with an understanding of the burden of proof, and preparing arguments for resolution by either the judge or jury.    Remember: even if the key contract is not in writing, depending on the circumstances, all may not be lost. While there is no substitute in law for a signed, written contract, in equity the action of the parties just may be such that quasi estoppel can prevent the statute of frauds from nullifying the client 's handshake deal. Actions sometimes speak louder than words.        Appendix: Sample Jury Question on Quasi estoppel Exception to Statute of Frauds    QUESTION uscore uscore uscore uscore uscore uscore uscore :    Is DEFENDANT estopped to deny the validity of the contract between PLAINTIFF and DEFENDANT? You are instructed that DEFENDANT is estopped to deny the validity of the contract if: 1. Asserting otherwise would be inconsistent with a position DEFENDANT has previously taken; n118 OR 2. DEFENDANT has acquiesced to the validity of the contract previously; n119 OR 3. DEFENDANT has accepted a benefit of the contract; n120 AND It would be unconscionable to allow DEFENDANT to deny the validity of the contract. n121 You are further instructed that "unconscionable" in this context means "grossly unfair." n122    Answer "Yes" or "No".    Answer: _________________
           
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