Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Thursday, April 19, 2012

Real Estate Transactions: What degree of specificity is required to satisfy the statute of frauds?

  
STATUTE OF FRAUDS GOVERNING CONVEYANCE OF REAL ESTATE, PURCHASE-OPTION CONTRACTS
 
Under the applicable statute of frauds, a contract for the sale of real estate is not enforceable unless it, or a memorandum of it, is in writing and signed by the person to be charged with the contract.  Tex. Bus. & Com. Code Ann. § 26.01(a), (b)(4) (Vernon 2009).  For a contract concerning the conveyance of real estate to satisfy the statute of frauds, “the writing must furnish within itself, or by reference to some other existing writing, the means or data by which the particular land to be conveyed may be identified with reasonable certainty.”  Wilson v. Fisher, 188 S.W.2d 150, 152 (Tex. 1945).  This applies to a purchase option in a contract.  See Matney v. Odom, 210 S.W.2d 980, 981–82 (Tex. 1948) (applying statute of frauds analysis to purchase option in contract).  Whether a contract falls within the statute of frauds is a question of law.  Iacono v. Lyons, 16 S.W.3d 92, 94 (Tex. App.—Houston [1st Dist.] 2000, no pet.).
  
The purpose of a description in a written conveyance is not to identify the land, but to afford a means of identification.  Jones v. Kelley, 614 S.W.2d 95, 99–100 (Tex. 1983).  While we apply a strict application of the statute of frauds, we allow for a liberal construction of the words describing the land.  Gates v. Asher, 280 S.W.2d 247, 248 (Tex. 1955).   
  
A metes-and-bounds description is not required to satisfy the statute of frauds.  Tex. Builders v. Keller, 928 S.W.2d 479, 481 (Tex. 1996).  Similarly, a plat in a recorded property description is not required.  Nguyen v. Yovan, 317 S.W.3d 261, 269 (Tex. App.—Houston [1st Dist.] 2009, pet. denied).  Nor does the description of the property require “[c]onviction beyond all peradventure of doubt.”  Gates, 280 S.W.2d at 249; see also Templeton v. Dreiss, 961 S.W.2d 645, 659 (Tex. App.—San Antonio 1998, pet. denied) (holding mathematical certainty not required).  Instead, only proof within “reasonable certainty” is required.  Gates, 280 S.W.2d at 249.
  
“If enough appears in the description so that a party familiar with the locality can identify the premises with reasonable certainty, it will be sufficient.”  Id. at 248–49.  Generally speaking, a property can be identified with reasonable certainty if it identifies the general area of the land and “contains information regarding the size, shape, and boundaries.”  Reiland v. Patrick Thomas Props., Inc., 213 S.W.3d 431, 437 (Tex. App.—Houston [1st Dist.] 2006, pet. denied); accord Fears v. Tex. Bank, 247 S.W.3d 729, 736 (Tex. App.—Texarkana 2008, pet. denied).
  
“[W]hen construing a conveyance, the court does not look at terms in isolation; rather, it must give effect to all parts of the conveyance and construe the document as a whole.”  Plainsman Trading Co. v. Crews, 898 S.W.2d 786, 789 (Tex. 1995).  When a contract includes a map of the property to be conveyed as a part of its description of the property, this is included in the analysis of whether the description satisfies the statute of frauds.  Matney, 210 S.W.2d at 984; U.S. Enters., Inc. v. Dauley, 535 S.W.2d 623, 628 (Tex. 1976).  “Whether a map is helpful in remedying descriptive defects of the contract depends on whether the missing details are shown on the map.”  U.S. Enters., 535 S.W.2d at 628.
   
While parol evidence may be considered under certain circumstances, it cannot be used to supply the “essential elements” of the contract.  Wilson, 188 S.W.2d at 152.  In contrast, it can be used to “explain or clarify the essential terms appearing in the” contract.  Id. 
   
If it does not sufficiently describe the land to be conveyed, a conveyance of an interest in real property is void and unenforceable under the statute of frauds.  Nguyen, 317 S.W.3d at 267.

SOURCE: HOUSTON COURT OF APPEALS – NO. 01-11-00328-CV   -- 4/19/12
(“The property description contained with the sublease is not so vague or ambiguous as to render its boundaries indeterminable.  Additionally, the record shows that a surveyor, using the information contained in or referenced by the sublease, was able to identify the property with reasonable certainty.  Accordingly, we hold that the trial court erred by determining, as a matter of law, that the property subject to the sublease’s purchase option could not be identified with a reasonable certainty.”) 

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