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Eastern Dental v Masel
U.S. D. Ct. [1980]
Author:- Sam
Biers
Statute of Frauds: Sale of Goods -
Requirement Contracts
Relevant Facts: When EDC was formed as a
corporation, to distribute and manufacture products exclusively
for orthodontics, Masel agreed to supply certain products
it manufactured. Over a period of 4.5 years EDC would
request, through invoice the products it needed and Masel would
supply them. After an attempt to purchase EDC failed Masel
informed EDC that it would no longer supply products to them.
EDC maintained that the last year’s worth of products were
defective. They had operated w/o a written agreement, doing
business solely through invoices and statement.
Legal Issue(s): Whether a contract can be
evidenced by a writing such as invoices and letters to satisfy
the S/F, for the sale of goods over $500?
Court’s Holding: Yes, but not here.
Procedure: EDC filed complaint in U.S. D. Ct
and Df filed partial summary judgment. Summary granted.
Law or Rule(s): A writing satisfies the
statute if 1) it is signed by the party to be charged; 2)
evidences a contract for the sale of goods; and 3) specifies a
quantity term. Quantity term need not be numerically stated
in a requirement K, there must be some writing to indicate the
quantity to be delivered under the K requirements.
Court Rationale: The letter and the invoices
may indicate that the parties had an ongoing business
relationship, they do not, expressly or by implication, reflect
that the contract between the parties was for the supply of EDC’s
requirements of Masel’s products. 1st, the
invoices reflecct only the quantity of goods shipped, not that a
requirement contract for a quantity existed. The letter
fails b/c the subject matter it involves is dental pliers, not
disposable orthodontic products which is what is claimed the
requirement contract was for. Masel was not obligated to
market his products solely through EDC. There is nothing in
the termination letter to suggest the account between the parties
was a requirement K. There are no writings to satisfy the
requirement to state a quantity term under the S/F.
Plaintiff’s Argument: The original
letter of negotiation and the invoices are sufficient as writing
to memorialize a requirements contract.
Defendant’s Argument: The S/F demands
that all contracts for the sale of goods involving $500 or more,
including requirements K, be reduced to writing.
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