October 13, 2006
E-mail and the Statute of Frauds
Those who teach Bazak Int'l v. Mast Indus., on the UCC's merchant exception to the Statute of Frauds, might be interested in a more recent case also involving Bazak and the Statute of Frauds, Bazak Int'l v. Tarrant Apparel Group.*
In Bazak v. Tarrant, the S.D.N.Y. held that an e-mail sent between merchants could serve as a confirmation of an earlier agreement pursuant to the UCC's "merchant exception to the Statute of Frauds (Section 2-201(2)).
The case is significant in two respects. First, Bazak is two-for-two on this issue. Second, it addresses the tricky question of whether e-mails can serve as confirmations. The difficulties with the UCC's "merchant exception" are manifest in the New York Court of Appeals' 4-3 decision in Bazak v. Mast Indus. Those difficulties are compounded in Bazak v. Tarrant, because the recipient of the allegedly confirmatory e-mail claims never to have opened the e-mail or its attachment. The District Court nonetheless denied Tarrant's motion to dismiss based on the Statute of Frauds, as material issues of fact regarding the existence of an agreement remained for resolution.
*Thanks to my student who, in violation of my policy on laptop use, found this case for me using Google during class earlier this week
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