Reference no: EM133194441 , Length: word count:650

Question: Jesus LaSalle was a prolific painter. Olivia Hulett, an art dealer and big fan of LaSalle's work, visited his gallery in 1988 and offered to buy 3 of his paintings for $4,000 each. LaSalle asked for a cash deposit of $1,000, which she paid him later that day. When she asked for a receipt, he insisted on drawing up a "contract," and got down on the floor and wrote it out in crayon on a large piece of paper, remarking that "someday this contract will be worth money."  The document stated "$12,000 - $1,000 DEPOSIT - OCT 25 88" and listed the three paintings. Both LaSalle and Hulett signed the paper.

When she asked about delivery of the paintings, LaSalle convinced her to wait for at least two years so that he could show the paintings at exhibitions. She took photographs of each of the paintings and left with the "contract." She returned 10 days later and claims that she and LaSalle agreed on a delivery date of October 1990, with the remaining $11,000 due at time of delivery.

In 1989, while the three paintings were being exhibited in Philadelphia and Cincinnati, LaSalle died at age 27 of a heroin overdose. At the time of his death, the market price for the paintings was $395,000.

Hulett filed a claim against LaSalle's estate for delivery of the three paintings, but the estate claimed that the alleged contract was a fraud and that, even if it were authentic, the document written in crayon was not an enforceable contract under UCC §2-201. The Uniform Commercial Code governs the sale of goods, such as a painting, and Section 2-201 specifies the formal requirements imposed by the statute of frauds. It provides that a contract for the sale or purchase of goods for $500.00 or more is not enforceable unless it is in writing, signed by the party to be charged. The only contract term that must be included in writing is the quantity. see U.C.C. Section 2-201. Beyond that, the written contract needs only to afford a basis to support that the verbal statements of the parties reflect a real transaction.

Instructions: Using the FIRAC model, analyze Hulett's claims against the LaSalle estate. Make sure that you discuss the requirements for an agreement, as well as the UCC Statute of Frauds provision of §2-201.

Interesting Background: This problem is based on Rosenfeld v Basquiat, 78 F. 3d 84 (2nd Cir. 1996). While not one of the paintings in the lawsuit, this is a Basquiat work. Now often classified as "graffiti art," you can buy Basquiat posters, t-shirts, prints, canvas, wall art, etc. on e-Bay, Amazon, and other websites.