TRIM (LORALEE) VS. MERV PROPERTIES, LLC.
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RENDERED: APRIL 8, 2011; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2010-CA-000152-MR
LORALEE TRIM
v.
APPELLANT
APPEAL FROM FAYETTE CIRCUIT COURT
HONORABLE ERNESTO M. SCORSONE, JUDGE
ACTION NO. 08-CI-02093
MERV PROPERTIES, LLC
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE: ACREE, DIXON, AND KELLER, JUDGES.
KELLER, JUDGE: Loralee Trim (Trim) appeals from the trial court's summary
judgment in favor of Merv Properties, LLC (Merv). On appeal, Trim argues that
summary judgment was improper because there are material issues of fact
regarding the terms of the agreement between the parties and application of the
doctrines of promissory and equitable estoppel. Merv argues that the trial court
properly granted summary judgment because the agreement alleged by Trim was
not in writing and therefore unenforceable. Having reviewed the record, we
affirm.
FACTS
Merv is owned equally by its four members, Roberta Gonzalez
(Gonzalez), Vivian Collins (Collins), Eric Friedlander (Friedlander), and Mark
Properties, LLC (Mark). Howard Markowitz (Markowitz), Mark's manager,
represents Mark's interest in Merv.
The owners of Merv founded the company for the purpose of
purchasing a warehouse located at 1211 Manchester Street, Lexington, Kentucky.
In that warehouse, Merv operates a monthly antique show called the Antique
Affair (the Affairs). Vendors at the Affairs rent space for their booths from Merv
on a month-to-month basis, paying in advance for each successive month. The
Affairs are held the second weekend of each month, from Friday morning to
Sunday afternoon; however, vendors are permitted to leave their merchandise in
their booths throughout the month.
In the early fall of 2007, Gonzalez, Collins, and Trim had discussions
regarding Trim operating a food service during the Affairs. Based on what she
believed was their agreement, Trim purchased a food trailer, other equipment, and
supplies at an estimated cost of $25,000.00. Trim then put the food trailer in the
food court area, which consisted of two booths, and paid $500.00 per month in rent
for that space.
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Trim operated the food service at the Affairs from November 2007
until March 2008. During that period, Trim not only occupied the two booths that
made up the food court, but also stored her supplies and placed a freezer in another
part of the building. In March 2008, Collins gave Trim a document (the fourteenday notice) stating that, among other things, Trim had to remove her belongings
from the space she was not leasing, and she could not leave her freezer plugged in
when the Affairs were not taking place. The document stated that, Trim either had
to comply within fourteen days or leave the premises. Trim testified that she could
not operate her business under those conditions so she vacated the premises.
Approximately six weeks later, Trim filed a complaint alleging that
she had an agreement with Merv that provided that she would have the exclusive
right to operate a food service during the Affairs for a period of two years; that she
would pay $500.00 per month in rent for the space she occupied; and that Merv
would purchase her equipment and any remaining supplies from her at the end of
the two-year period. Trim further alleged that Merv had breached that agreement,
interfered with her business, and wrongfully removed her from the premises. Merv
denied Trim's allegations but conceded that Trim had a month-to-month lease.
The parties conducted discovery and, in pertinent part, Trim took the
depositions of Gonzalez, Collins, Friedlander, and Markowitz.1 Collins,
Friedlander, and Markowitz testified that they had not approved any agreement
with Trim that varied from the usual month-to-month vendor lease. All three
1
We note that Trim took depositions of two other witnesses; however, those witnesses did not
have knowledge of what, if any, agreement Trim had with Merv. Therefore, we have not
summarized them herein.
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testified that Gonzalez would have been responsible for "recruiting" vendors and
would have discussed any agreement with Trim. Gonzalez testified that she
understood that Trim had the same lease arrangement as any other vendor.
Trim testified that Collins and Gonzalez approached her about
operating the food court at the Affairs, and they agreed Trim would do so. Based
on her understanding of the agreement, Trim borrowed $25,000.00 to purchase a
food trailer, equipment, and supplies. Trim admitted that there was no written
agreement between the parties and that she could have prepared one. However,
she did not do so because Gonzalez and Collins said they would.
Following discovery, Merv filed a motion for summary judgment,
which the trial court granted. Trim then filed a motion to alter, amend, or vacate,
which the court denied. It is from the court's judgment and order that Trim now
appeals.
We set forth additional facts as necessary when addressing the issues
raised on appeal.
STANDARD OF REVIEW
"The standard of review on appeal of a summary judgment is whether
the circuit judge correctly found that there were no issues as to any material fact
and that the moving party was entitled to a judgment as a matter of law." Pearson
ex rel. Trent v. Nat’l Feeding Systems, Inc., 90 S.W.3d 46, 49 (Ky. 2002). With
that standard in mind, we address the issues raised by Trim on appeal.
ANALYSIS
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Kentucky Revised Statute (KRS) 371.010(6) and (7) provide that any
lease for longer than a year and any agreement that will not be performed within a
year must be in writing to be enforceable. Furthermore, KRS 355.2-201(1)
provides that a contract for the sale of goods for a price of more than $500.00 must
be in writing to be enforceable. Because the impact of the preceding statutes on
this matter is the same, we refer to them hereafter collectively as the Statute of
Frauds.
Trim admits that the parties did not have a fully executed agreement
setting forth the terms she alleges. However, she argues that there was sufficient
evidence of an enforceable agreement to overcome Merv's motion for summary
judgment. In support of her argument, Trim states that, when Merv provided her
with the fourteen-day notice, it acted as if an agreement existed. Furthermore,
Trim notes that she received an e-mail from Gonzalez indicating "that she had
given additional space to [Trim] and that her partners were not pleased."
According to Trim, the notice, the e-mail, and the parties' actions taken together
prove the existence of an enforceable agreement.
Trim's argument misses the mark. Merv does not dispute that an
agreement existed. However, the agreement Trim alleges involved a lease of more
than one year and could not be performed within one year. Furthermore, the
alleged buy-back provision was for goods valued at more than $500.00. To be
enforceable, that agreement had to be in writing. A writing sufficient to satisfy the
statutory requirement must contain all of the elements of a contract. Antle v. Haas,
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251 S.W.2d 290 (Ky. 1952). The e-mail Trim relies on references the additional
space Trim occupied. The fourteen-day notice identifies the booths Trim occupied.
However, neither document contains any other language that could be construed to
evidence the alleged agreement. There is no mention of the amount of rent or the
length of the leasehold. Furthermore, there is no mention of the alleged agreement
by Merv to purchase the food trailer, equipment, and supplies. These documents,
taken separately or together, do not constitute a writing sufficient to satisfy the
requirements of the statute of frauds. Therefore, the alleged agreement is not
enforceable.
We next address Trim's argument that the trial court erred when it did
not apply the doctrines of equitable and promissory estoppel to impose an
enforceable agreement on the parties. The elements of equitable estoppel are: (1)
conduct, including acts, language, and silence, amounting to a representation or
concealment of material facts; (2) the estopped party is aware of these facts; (3)
these facts are unknown to the other party; (4) the estopped party must act with the
intention or expectation his conduct will be acted upon; and (5) the other party in
fact relied on this conduct to his detriment. Gray v. Jackson Purchase Production
Credit Association, 691 S.W.2d 904, 906 (Ky. App. 1985).
Trim argues that Collins and/or Gonzalez told her they would "buy
her out" and she relied on their statement when she purchased the food trailer,
equipment, and supplies. However, Trim testified that she was aware of the
importance of a written agreement, an awareness borne out by an e-mail to
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Gonzalez asking Gonzalez to prepare a written agreement. Trim also testified that
she knew that one member could not bind Merv to a written agreement and that
any such agreement needed approval of Merv's members. Therefore, Trim's
argument fails for two reasons: (1) Merv had not approved the alleged agreement;
and (2) Trim knew or should have known that Merv had not assented to the alleged
agreement.
As to Trim's claim of promissory estoppel, the Supreme Court of
Kentucky has stated that “the statute of frauds is not a bar to a fraud or promissory
estoppel claim based on an oral promise of indefinite employment.” United Parcel
Service Co. v. Rickert, 996 S.W.2d 464, 471 (Ky. 1999). However, that statement
was dicta as the decision in Rickert turned on the issue of equitable estoppel, not
promissory estoppel. Furthermore, in Sawyer v. Mills, 295 S.W.3d 79, 90 (Ky.
2009), the Court stated all that can be deduced from Rickert is that the statute of
frauds does not bar a fraud or promissory estoppel action in an employment case.
The Court also noted that estoppel can only be used to overcome the statute of
frauds in the most extreme cases because, to hold otherwise, would amount to
amending the statute in violation of separation of powers. Id.
This is neither an employment case nor an extreme case; therefore,
promissory estoppel is not applicable. Furthermore, even if promissory estoppel
applied, Trim has not put forth evidence to support invocation of that doctrine.
Promissory estoppel requires “[a] promise which the promisor should reasonably
expect to induce action or forbearance on the part of the promisee . . . and which
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does induce such action or forbearance . . . .” Meade Constr. Co. v. Mansfield
Commercial Elec., Inc., 579 S.W.2d 105, 106 (Ky. 1979). As noted above, Trim
failed to establish that Merv, the party against whom she seeks relief, assented to
the alleged agreement. Therefore, even if it were available, she cannot rely on
promissory estoppel for relief.
CONCLUSION
For the foregoing reasons, we affirm the trial court's summary
judgment.
ALL CONCUR.
BRIEFS FOR APPELLANT:
BRIEF FOR APPELLEE:
Justin R. Morgan
Lexington, Kentucky
William P. Thurman
Lexington, Kentucky
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