Summary of a Recent
Judicial Development in
Commercial Transactions

Court Finds Defendants Breached Oral Contract for Sale of a Horse

Walt McCarter
National AgLaw Center Research Associate

Summary of Decision

In Spayd v. Olde Stone Ranch Co., No. 1 CA-CV 08-0087, 2009 WL 1138048 (Ariz. Ct. App. Apr. 28, 2009), the Arizona Court of Appeals held that a trial court's determination that defendants had breached an oral contract for the sale of a horse was supported by the record, and held that the trial court had not abused its discretion in awarding the plaintiff attorneys' fees.

Background

The plaintiff entered an oral contract to purchase a horse from Olde Stone Ranch (Olde Stone) for $55,000. Id. at *1. She gave Olde Stone's agent $40,000 towards the purchase price, $1,850 for one year's insurance on the horse, and traded two fillies. Id. In return, the agent sent her American Quarter Horse Association (AQHA) transfer papers for a horse with a different name and different markings; when the plaintiff rejected the documents, the agent told her that the horse's name had been changed and that she would receive the corrected papers within one week. Id. The plaintiff contacted the AQHA and found out that no transfer papers were being processed, and she demanded a refund Olde Stone. Id. The parties corresponded several times over the next few weeks, until Olde Stone ultimately sold the horse to another party for $55,000. Id. During the interim, the horse had been moved several times, including out of state, without notice to the plaintiff. Id. The plaintiff brought an action against Olde Stone for breach of contract, fraud, and misrepresentation. Id. Olde Stone's agent subsequently paid $41,850 in restitution related to a plea to theft conviction arising out of the matter, and the trial court awarded the plaintiff interest on the restitution and attorneys' fees and costs. Id. Olde Stone appealed. Id.

Arguments

Olde Stone argued that the trial court erred in holding that it had breached the contract, in denying its motion for judgment as a matter of law, in admitting certain evidence, and in awarding attorneys' fees to the plaintiff "despite her failure to timely comply with Arizona Rule of Civil Procedure 54(g)(2)." Id. at *2.

Analysis and Holdings

The trial court had found that Olde Stone breached the contract because the plaintiff had fully performed all her obligations and had no further performance due, while Olde Stone "never transferred the horse or the correct paperwork to [the plaintiff], never advised her when the completed AQHA paperwork was received and never even advised her of the horse's location as Olde Stone moved it from place to place." Id. Moreover, Olde Stone had not refunded her money or returned her fillies. Id. The appellate court found that the trial court's findings and conclusions were supported by the record, and affirmed on the breach of contract issue. Id. For the same reasons, the court found no abuse of discretion in denying Olde Stone's motion for judgment as a matter of law. Id. at *3. Lastly, the court found no abuse of discretion in awarding the plaintiff attorneys' fees even though she filed her application ten days after the deadline, because the trial court had "explicitly found no prejudice to Olde Stone because it knew the application was forthcoming and no final judgment had yet been entered." Id.

The case was decided on April 28, 2009.