by Phoenix attorney Christopher A. Combs, partner with Combs Law Group, P.C.
Question: My brother and his wife own a cabin in the Show Low area. My brother said that he would sell the cabin to me for $125,000. Even though the cabin needed some repair work, my wife and I were very excited. In fact, every weekend last summer we went up to the cabin and bought materials such as paint and lumber, and personally completed the necessary repairs. My brother and I intended to get the paperwork for the sale done this summer, but we procrastinated. My brother and his wife are now getting a divorce, and my brother says that he can no longer sell the cabin to us. My brother says that he is willing to reimburse us for the materials that my wife and I bought, and that he will even pay us an hourly wage for the time we spent doing the repairs. My wife and I have the $125,000 to purchase the home, however, and we want the cabin. Can we require my brother to sell the cabin to us for $125,000 even though we did not do any of the paperwork?
Answer: The Statute of Frauds generally requires a written contract before a sale of real property can be enforced. The reason for this general rule is to prevent misunderstandings between the seller and the buyer as to the terms and conditions of the sale. One of the exceptions to this general rule, however, is partial performance. In other words, if the buyer has partially performed on the verbal contract, the public policy of protecting a buyer’s partial performance outweighs the risk of a misunderstanding between the seller and the buyer. Therefore, because of the time and money you and your wife spent last summer in repairing the cabin, a court would probably enforce your verbal agreement with your brother to sell the cabin to you for $125,000.