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Texas Supreme Court Update Part II

Loose Language Sinks Deals

By Matthew Buschi

Today, the Texas Supreme Court delivered its opinion in Copano Energy, LLC et al. v. Stanley D. Bujnoch, Life Estate et. al, holding that what was essentially a collection of emails and letters that didn’t directly reference each other and included a variety of terms, proposals, and apparent agreements were not sufficient to satisfy the Statute of Frauds.

The Statute of Frauds, requires certain agreements, including agreements related to real estate be in writing. As the Compano court emphasized, the Statute of Frauds has a high standard, requiring a “written memorandum which is complete within itself in every material detail, which contains all of the essential elements of the agreement, so that the contract can be ascertained from the writings without resorting to oral testimony.” Nonetheless, the Court has previously held that a single document is not required, and that a collection of documents can satisfy the Statute of Frauds.  Thus, a collection of emails can be sufficient to satisfy the statute, but in this case it was not.

The “why not” is important here, and it is important to all of us who on a day to day basis use email and texts as a primary means of communication. It’s quite common that our use of language in these instant, often truncated means of communication are not thorough, and rely on inferences drawn from earlier texts or emails, or assume that a fourth email two months removed from the first one inherently includes each previous discussion.  The Compano decision reminds us today that the law will not find an agreement, at least in the context of the statute of frauds, unless what is actually being agreed to is specific and can be deduced from the writings themselves. The emails, texts or other writings cannot merely reflect an agreement to agree. In essence, the law requires “certainty and clarity” before it will find a writing satisfies the requirements of the statute to be enforceable.

The takeaway? Always be precise with your language and precise with your electronic correspondence.  This  is and always has been good practice, but many have discarded that good practice in our modern use of instant and short communications of an electronic world.  Further, always send a summary email or text including the important terms of what you believe is the agreement, and get a response if possible.  Absent that clarity and confirmation, a court might later be quite unwilling to draw the inferences for you.

To read the full Supreme Court opinion click here.

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Copyright © 2020 Matthew Buschi. All rights reserved.