Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Tuesday, February 26, 2013

Oral modification of contract or novation barred if original contract falls under the statute of frauds


STATUTE OF FRAUDS CONTINUES TO APPLY IF ORIGINAL CONTRACT WAS SUBJECT TO IT, THUS PRECLUDING VERBAL MODIFICATION OF TERMS 

There can be no oral modification of an agreement that is required to be in writing under the statute of frauds. Columbia/HCA of Houston, Inc. v. Tea Cake French Bakery & Tea Room, 8 S.W.3d 18, 21 (Tex. App.-Houston [14th Dist.] 1999, pet. denied).

SOURCE: CORPUS CHRISTI COURT OF APPEALS - No. 13-11-00229-CV – 1/17/2013
An agreement that cannot be performed within one year of its making falls under the statute of frauds. TEX. BUS. & COM. CODE ANN. § 26.01(a), (b)(6) (West 2009).
Here, the leases that form the basis of XTRA's lawsuit are for thirty-six month terms. They therefore cannot be performed within one year and fall under the statute of frauds. As such, ATC's novation defense, based on an alleged oral modification of the lease terms by an XTRA vice-president, would have failed as a matter of law, so we cannot conclude that ATC was harmed by the exclusion of Alvarez's testimony relevant to the alleged oral modification. See TEX. R. APP. P. 44.1(a); Nissan Motor Co., 145 S.W.3d at 144; see also Columbia/HCA of Houston, Inc., 8 S.W.3d at 21. ATC's second issue is overruled.

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