Gallagher, Langlas & Gallagher v. Burco

587 N.W.2d 615, 1998 Iowa App. LEXIS 65, 1998 WL 918213
CourtCourt of Appeals of Iowa
DecidedOctober 29, 1998
Docket97-1577
StatusPublished
Cited by17 cases

This text of 587 N.W.2d 615 (Gallagher, Langlas & Gallagher v. Burco) is published on Counsel Stack Legal Research, covering Court of Appeals of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gallagher, Langlas & Gallagher v. Burco, 587 N.W.2d 615, 1998 Iowa App. LEXIS 65, 1998 WL 918213 (iowactapp 1998).

Opinions

STREIT, J.

A father appeals a law firm’s judgment against him for guaranteeing his daughter’s expenses in a custody trial over his grandchildren. Because the statute of frauds renders Burco’s oral contract unenforceable, the judgment is reversed.

I. Background Facts & Proceedings.

Lynn Roose requested the law firm Gallagher, Langlas and Gallagher, P.C. represent her in her dissolution action. Attorney Thomas Langlas signed an attorney fee contract in August 1994, and gave it to Roose to sign and return. He also requested a $2000 retainer fee. Roose never signed or returned the contract. She did not pay the retainer fee in full.

The firm represented Roose despite her not signing the contract or paying the retainer fee in full. On April 10, 1995, the Gallagher attorneys met with Roose and her father, Gaylen Bureo. The attorneys told Bureo about the anticipated child custody trial. The firm contends during the meeting Bureo agreed to be responsible for the re[617]*617mainder of Roose’s account. Bureo denies an agreement. At the end of the meeting Bureo gave the firm a check for $1000 to pay the outstanding balance of $814.92 on Roose’s account.

Before trial, Mary Chicchelly, an attorney with the firm, contacted Bureo requesting an additional retainer to secure fees to be incurred and Bureo told her, “My word as a gentleman should be enough_ I told Mr. Langlas I would pay and I will pay.”

Roose failed to pay her legal fees. In July 1995, the attorneys sent Bureo a letter requesting $5000 for Roose’s legal fees or the signing of a promissory note. At the end of July, they sent Bureo another letter asking him to sign a promissory note for $10,000. Neither Roose nor Bureo paid the attorney fees or signed the notes. The firm represented Roose in the July 1995 trial.

After trial, Bureo returned the second letter and promissory note with a notation stating he was not responsible for his daughter’s attorney fees. The firm filed a motion to withdraw in July 1996 and the motion was granted.

The firm filed a petition against Bureo and Roose for the unpaid legal fees. Bureo denied the allegations and raised affirmative defenses of statute of frauds, revocation, and waiver. On August 6, 1997, the trial court entered a trial judgment against Bureo and a default judgment against Roose for $14,-588.53. Bureo appeals.

II. Standard of Review.

Our review is for the correction of errors at law. The district court’s findings of fact have the effect of a special verdict and are binding on us if supported by substantial evidence. Iowa R.App. P. 14(f)(1); Waukon Auto. Supply v. Farmers & Merchants Sav. Bank, 440 N.W.2d 844, 846 (Iowa 1989).

III. Sufficiency of Evidence to Prove Oral Contract.

Bureo contends the district court erred in finding there was sufficient evidence of an oral contract between himself and the law firm to pay Roose’s bill.

The existence of an oral contract, as well as its terms and whether it was breached, are ordinarily questions for the trier of fact. Dallenbach v. Mapco Gas Prod., Inc., 459 N.W.2d 483, 486 (Iowa 1990). To prove the existence of an oral contract, the terms must be sufficiently definite for a court to determine with certainty the duties of each party, the conditions relative to performance, and a reasonably certain basis for a remedy. Netteland v. Farm Bureau, 510 N.W.2d 162, 165 (Iowa App.1993); Burke v. Hawkeye Nat’l. Life Ins. Co., 474 N.W.2d 110, 113 (Iowa 1991); Severson v. Elberon Elevator, Inc., 250 N.W.2d 417, 420 (Iowa 1977); Rest.2d Contracts § 33 at 597 (1979). Where a contract appears to exist, courts are reluctant to find it too uncertain to be enforceable. Audus v. Sabre Communications Corp., 554 N.W.2d 868, 872 (Iowa 1996). However, when the terms are not definite, courts are reluctant to impose reasonable terms on contracting parties. Bowser v. PMX Industries, Inc., 545 N.W.2d 898, 900 (Iowa App.1996).

The question is, then, whether the terms of the communications between Bureo and the firm were definite enough to form a contract.

At the April 10, 1996, meeting, Bureo was told the estimated expense of his daughter’s custody trial would be approximately $1000 per day. The firm would not guarantee Bur-eo the trial would only last two or three days. Bureo paid $1000 towards an existing $814.92 bill and said he would pay for future services. Before trial, Bureo was pressed for payment or to sign a promissory note. Bureo said he would pay and his word was good enough. Bureo took an active part in the trial by testifying and participating in conferences with counsel during recesses.

Bureo claims his guarantee to pay future legal expenses is too vague and uncertain to form a contract. The dealings described above are definite. Each party’s duties are clear. The attorneys were to continue representing Roose in her custody fight. Bureo was to pay her legal fees. These terms are as definite as many attorney-fee agreements. These facts are sufficient evidence to prove an oral contract existed.

[618]*618The trial courts finding an oral contract existed between Bureo and the firm is supported by substantial evidence. This may not suffice, however. Because the contract was in the nature of a surety or guaranty contract, the evidence or proof of the contract may have to be written. We now consider the statute of frauds.

TV. Enforceability of Oral Contract Under the Statute of Frauds Section 622.32(2).

Bureo next contends evidence of the oral contract is barred by the statute of frauds. Our appellate courts have held in a number of cases the statute of frauds is a rule of evidence and not of substantive law. The statute relates to the manner of proof, but does not forbid oral contracts or render them invalid. Stauter v. Walnut Grove Products, 188 N.W.2d 305, 313 (Iowa 1971); Meylor v. Brown, 281 N.W.2d 632, 634 (Iowa 1979). If the statute renders evidence of the guaranty incompetent and thus inadmissible, the judgment against Bureo must be reversed. See Maresh, 304 N.W.2d at 437.

The statute of frauds requires that certain contracts be evidenced by some kind of writing before they are enforceable. The statute applies to surety contracts — a promise to a creditor to answer for debt, default, or miscarriage of another.1

Iowa Code section 622.32(2) codifies this doctrine:

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