Case No. 77 IMPLIED CONTRACTS AND STATUTE OF FRAUDS/SUFFICIENCY OF WRITING Valentino y. H.F. Davis Appellate Division, Third Department 270 A.D.2d 635, 703 N.Y.S.2d 609 (2000) FACTS: John Valentino (Valentino) is in the business of breeding and raising horses. Jonathon H. F. Davis (Davis) is a veterinarian who operates Milfer Farm Inc. in the Town of Unadilla, Chenango County. Valentino and Davis decided to breed their horses and exchanged several drafts of agreements regarding the boarding, breeding, and care of Valentino's mares with Davis' stallions. Additionally, the draft proposals addressed the care and ownership of any future foals (young horses) for a three-year period at Milfer Farm. The parties were unable to agree on the terms and as a result no written agreement was executed. Evidence showed that the parties intended, had they been able to reach an agreement, to have a formal contract prepared by an attorney and signed by the parties. While the parties were still negotiating, Valentino delivered twenty mares and unweaned foals to Milfer Farms. Per agreement, Davis cared for the mares and foals over the next four months, and was successful in breeding many of the mares. Thereafter, Valentino removed all his horses from Milfer Farms claiming that they were overgrazed and maintained in overcrowded stalls leading to sickness, and in some cases, death. Valentino kept the foals later born to mares as a result of breeding during this four-month period. Valentino sued Davis for breach of contract. The trial court determined that no written agreement had been entered but held that there were triable issues of fact regarding the existence of an enforceable oral or implied-in-fact contract. Davis appealed. FIRST ISSUE: Where parties exchange draft proposals for a prospective agreement, and it is clear that the parries intended to draft a formal written contract once an oral agreement was reached, will the draft proposals satisfy the writing requirement of the Statute of Frauds? DECISION: No REASONING: A contract that by its terms cannot be performed within one year of making is unenforceable under the Statute of Frauds unless it is in writing. In this case the proposed contract was for a period of three vears. hence it is unenforceable unless reduced their agreement to a formal writing prepared by an attorney. Since no writing was ever executed, the writing requirement of the Statute of Frauds was not satisfied. SECOND ISSUE: Does an implied-in-fact contract exist from the conduct of the parties where the parties clearly intended to be bound only by the terms of a formal written agreement. DECISION: No REASONING: Valentino contended that an implied-in-fact agreement existed for a three year period because Davis partially performed by caring for Valentino's mares and unweaned foals in addition to facilitating the breeding process during a four month period. However, Valentino acknowledged that the parties intended that any long term agreement be reduced to writing, For this reason, the court denied the existence of an implied in fact contract noting that "a contract may not be implied in fact from the conduct of the parties where it appears that they intended to be bound only by a formal written agreement"