Smith and Roberson's Business Law 16th Edition by Richard Mann,Barry Roberts

Exercise 23

When Mr. McClam died, he left the family farm, heavily mortgaged, to his wife and children. To save the farm from foreclosure, Mrs. McClam planned to use insuranc proceeds and her savings to pay off the debts. She was unwilling to do so, however, unless she had full ownership of the property. Mrs. McClam wrote her daughter, stating that the daughter should deed over her interest in the family farm to her mother and promising that all the children would inherit the farm equally upon their mother's death. The letter further explained that if foreclosure occurred, each child would receive very little, but if they complied with their mother's plan, each would eventually receive a valuable property interest upon her death. Finally, the letter stated that all the other children had agreed to this plan. Consequently, the daughter also agreed. Years later, Mrs. McClam tries to convey the farm to her son Donald. The daughter challenges, arguing that the mother is contractually bound to convey the land equally to all of the children. Donald says this was an oral agreement to sell land and is unenforceable. The daughter argues that the letter satisfies the statute of frauds, making the contract enforceable. Who gets the farm? Explain.