APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA (D.C. Civil No. 74-704).
Aldisert, Gibbons and Weis, Circuit Judges.
This appeal has its basis in an alleged oral contract for the sale of an item of construction equipment, a 475 Michigan Loader, Series III, 12 cubic yard, at a price of $60,000.00. The district court granted the defendants' motion for summary judgment on the ground that the statute of frauds provision of the UNIFORM COMMERCIAL CODE, § 2-201, barred the action. We conclude that the existence of a factual issue as to the payment-and-acceptance exception of the statute requires that the judgment be vacated and the case remanded.
The facts, gleaned from the pleadings and pretrial narratives of the parties and viewed by the trial court in the light most favorable to the plaintiff as the party opposing the motion for summary judgment,*fn1 establish the following:
The plaintiff and defendants are construction contractors. Defendants owned a Michigan Loader, and on May 25, 1974 plaintiff discussed with them the purchase of that equipment. On May 29, 1974, plaintiff alleges that a price of $60,000.00 was agreed upon. On the same day, the plaintiff delivered to the defendants his check in that amount, with a notation on the face "(Pd. in full 475 Michigan)." However, when the plaintiff later asked for delivery of the loader, defendants refused to comply. Defendants did not cash the plaintiff's check but retained it for thirty days before returning it unendorsed and unaltered in any respect. Plaintiff then filed suit for damages.
This is a diversity action, and the parties have agreed that the law of Pennsylvania applies. The UNIFORM COMMERCIAL CODE is in effect in that state and the pertinent provision appears at 12A P.S. § 2-201. The portions relevant to this appeal read:
"(1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker . . . .
"(3) A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable
(c) with respect to goods for which payment has been made and accepted or which have been received and accepted."
The district court found that, since the defendants never signed or endorsed the check, it did not constitute a writing which would be enforceable against them under subsection (1). We find no error in this ...