L.R. Bretz v. Portland General Electric Co.

882 F.2d 411 9 UCC Rep.Serv.2d 213 L.R. BRETZ, Plaintiff-Appellant, v. PORTLAND GENERAL ELECTRIC CO., Defendant-Appellee. No. 87-4206. United States Court of Appeals, Ninth Circuit. Argued and Submitted May 1, 1989. Decided Aug. 14, 1989. L.R. Bretz, Billings, Mont., pro se. Roger K. Harris, Portland, Or., for defendant-appellee. Appeal from the United States District Court for the District of Oregon. Before TANG, BOOCHEVER and KOZINSKI, Circuit Judges. KOZINSKI, Circuit Judge: 1 We consider again the validity of Sam Goldwyn's aphorism that an oral contract isn't worth the paper it's written on. L.R. Bretz, a Montana resident, brought a diversity suit against Portland General Electric (PGE), an Oregon corporation, for breach of a contract for the sale of PGE's stock in its wholly-owned subsidiary, the Beartooth Coal Company. The district court granted PGE's motion for summary judgment, holding that the exchange of letters between Bretz and PGE did not satisfy Montana's statute of frauds. 1 We review the district court's grant of summary judgment de novo. See Darring v. Kincheloe, 783 F.2d 874, 876 (9th Cir.1986). Facts 2 In the late summer of 1983, Bretz, identifying himself as…

We consider again the validity of Sam Goldwyn’s aphorism that an oral contract isn’t worth the paper it’s written on. L.R. Bretz, a Montana resident, brought a diversity suit against Portland General Electric (PGE), an Oregon corporation, for breach of a contract for the sale of PGE’s stock in its wholly-owned subsidiary, the Beartooth Coal Company. The district court granted PGE’s motion for summary judgment, holding that the exchange of letters between Bretz and PGE did not satisfy Montana’s statute of frauds. 1 We review the district court’s grant of summary judgment de novo. See Darring v. Kincheloe, 783 F.2d 874, 876 (9th Cir.1986).

Facts

In the late summer of 1983, Bretz, identifying himself as special agent in Montana for Western States Energy Ventures, wrote PGE and Beartooth offering to buy the Beartooth stock for $2 million. Bretz *412 sought a variety of representations from PGE concerning the Beartooth securities, their sole ownership by PGE, the nature and assignability of Beartooth’s holdings, and so forth. The letter also detailed an elaborate procedure for PGE’s acceptance of the offer and for the completion of the transaction. 2 PGE responded on August 5, 1983,…

dissenting:

Because I believe that extraneous evidence was admissible and that there are genuine issues of fact to be resolved whether the parties entered an enforceable contract, and concerning Bretz’ estoppel claim, I respectfully dissent.

I. STATUTE OF FRAUDS

There is no dispute that under Montana law a contract for the sale of securities, as here involved, comes under the statute of frauds, Mont.Code Ann. § 30-8-319 (1987). The question at issue is not whether evidence other than the contents of the writings is admissible to prove the terms of an agreement, see Mont.Code Ann. § 28-2-905 (1987), but whether the parties made a valid agreement. “When the validity of the agreement is the fact in dispute” extrinsic evidence is not barred by the parol evidence rule. MontCode Ann. § 28-2-905(l)(b) (1987).

The terms of the agreement were set forth in the correspondence. On August 23,1983, PGE responded to Bretz’ offer for the securities, stating:

Bretz responded on August 29,1983 with an “Acceptance of Offer” stating:

At that point there was no dispute as to the terms of the agreement. The only issue is whether there was a valid agreement. All that is necessary to satisfy the…