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Contracts Keyed to Summers
Howard M. Schoor Associates, Inc. v. Holmdel Heights Construction Co.
Facts
Holmdel Heights Construction Co. (Defendant) is a real estate developer. Defendant hired Howard M. Schoor Associates, Inc. and another corporation (Plaintiffs) to conduct engineering and surveying work for one of Defendant’s developments. On April 14, 1970, Plaintiffs met with Alan Sugarman, Defendant’s attorney, to discuss outstanding bills owed to Plaintiffs. At this meeting, Defendant’s attorney wrote Plaintiffs a check from his trust account for $2,000. Plaintiffs later claimed this payment was made in good faith to ensure Plaintiffs continued their work under the agreement. On June 12, 1970, Defendant’s attorney sent a letter requesting that Plaintiffs continue their work, and enclosing a check for $1,000 from his own funds as a good faith payment. Plaintiffs completed the work but were not paid. Plaintiffs thereafter sued to recover the outstanding amount. The trial judge found that Plaintiffs’ work was crucial to Defendant’s financial success, that Defendant’s attorney had a substantial financial interest in Defendant, and that Defendant’s attorney had orally promised to guarantee Defendant’s debts if Plaintiffs continued to perform their work. The trial court found in favor of Plaintiffs and granted them a judgment of $24,105.30. The court of appeals reversed, finding that Defendant’s attorney’s promise would be unenforceable under the statute of frauds.
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