abridges the powers of courts of equity to compel the specific performance of agreements in cases of part performance." N.Y. Gen. Obligations Law § 5-703(4). Accordingly, under certain circumstances, specific performance of an unwritten agreement can be compelled when there has been sufficient part performance which is unequivocally referable to the agreement. See McKinley v. Hessen, 202 N.Y. 24, 29-30, 95 N.E. 32, 33-34 (1911); Tuttle, Pendelton & Gelston, Inc. v. Dronart Realty Corp., 90 A.D.2d 830, 455 N.Y.S.2d 830 (App. Div. 2d Dep't 1982); Fiske v. Fiske, 95 A.D.2d 929, 464 N.Y.S.2d 282 (App. Div. 3rd Dep't 1983).
In order to satisfy the part performance exception to the Statute of Frauds, the performance needs to be "unequivocally referable" to the alleged oral agreement. See Korff v. Pica Graphics, Inc., 121 A.D.2d 511, 504 N.Y.S.2d 17 (App. Div. 2d Dep't 1986); Pallette Stone Corp. v. Mangino, 217 A.D.2d 738, 629 N.Y.S.2d 103 (App. Div. 3rd Dep't 1995). For performance to be unequivocally referable to the agreement, there must be no explanation for the parties' conduct other than performance of the alleged agreement. See Burns v. McCormick, 233 N.Y. 230, 232, 135 N.E. 273, 273 (1922) ("What is done must itself supply the key to what is promised. It is not enough that what is promised may give significance to what is done."); Onorato v. Lupoli, 135 A.D.2d 693, 522 N.Y.S.2d 593 (App. Div. 2d Dep't 1987) (paying mortgage and taxes, making improvements, and occupying premises did not "unequivocally" refer to oral conveyance of property because other explanation was possible). "In order to take an oral agreement out of the Statute of Frauds, there must be evidence of such part performance as is 'unequivocally referable' to the oral agreement so that no meaning can be given to such performance other than the existence of such agreement." Reisler v. 60 Gramercy Park North Corp., 88 A.D.2d 312, 316, 453 N.Y.S.2d 186, 189 (App. Div. 1st Dep't 1982) (citing Burns v. McCormick, 233 N.Y. 230, 135 N.E. 273).
The complaint alleges that from 1987 to March of 1995, Aegis performed the oral agreement. Specifically, the complaint alleges that Aegis renovated the 27th floor, charged its tenants for a share of the costs, sublet various portions of the leased space, and filed tax returns covering the leased space. (Am. Compl. P 15). These actions, Messner Vetere contends, constitute performance which is unequivocally referable to the oral agreement. The complaint does not provide a clear and precise statement of the terms of the alleged oral agreement. It merely alleges that "Aegis assumed all obligations under the Lease and agreed to hold Plaintiff and its predecessors harmless from any responsibility thereunder." (Am. Compl. P 22).
The conduct of Aegis alleged in the complaint does not unequivocally refer to such a general and complete assumption of obligations under the lease. Considering the fact that Aegis owned Creamer, the tenant named in the written lease, from July of 1986 to June of 1992, and at different times owned subtenants of the leased property, performance of the tenant's obligations under the lease is not clearly and unequivocally referable to the oral agreement. Aegis's alleged performance before June of 1992 can be explained by Aegis's financial interest in Creamer. Furthermore, any performance alleged in the complaint after 1992 is consistent with Aegis's contention that due to the frequent and complicated corporate transformations, Aegis had mistakenly continued to perform Creamer's obligations under the lease. (Def.'s Reply Mem. at 5-6). Aegis's letter of March 9, 1995 by which it terminated any further performance of obligations under the lease is also consistent with mistaken performance. Mistake is as likely an explanation for the conduct of Aegis alleged in the complaint as is the existence of an oral agreement to assume all the obligations of the lease. Without conduct that is unequivocally referable to the agreement, the part performance exception cannot save the alleged oral agreement from the requirements of the Statute of Frauds.
In addition, Messner Vetere's invocation of the part performance exception distorts its purpose. The part performance exception to the Statute of Frauds, closely related in origin and nature to equitable estoppel, see Reisler v. 60 Gramercy Park North Corp., 88 A.D.2d 312, 316-17, 453 N.Y.S.2d 186, 189-90; Bon Temps Agency, Ltd. v. Towers Org., Inc., 187 A.D.2d 376, 590 N.Y.S.2d 97 (App. Div. 1st Dep't 1992), is meant to prevent fraud. McKinley v. Hessen, 202 N.Y. at 29-30, 95 N.E. at 34 ("The intervention of equity is asked to prevent the commission of fraud."). In accordance with this purpose, the exception generally provides equitable relief for a party that performed an oral agreement, not a party that merely benefited from the other party's performance.
When a parol agreement for the conveyance of real estate, void by the Statute of Frauds, has been proved and part performance has been shown by acts of the party seeking relief, which could have been done with no other design than that of performance, if an adequate action at law is not an adequate remedy, the agreement will be specifically enforced.
Id., 202 N.Y. at 30, 95 N.E. at 34 (emphasis added).
There are no allegations in the complaint that Messner Vetere performed any obligations under the alleged agreement with Aegis. In fact, the complaint does not allege that Messner Vetere had any obligations under the agreement. The complaint alleges only that Aegis benefited from the agreement by exercising control of the leased space including the authority to sublet it, (Am. Compl. P 12), and that during the period Aegis allegedly performed the obligations of the tenant, Messner Vetere "took no action with respect to the Lease, including with respect to subleasing." (Am. Compl. P 16). Thus there is no allegation that Messner Vetere performed or had any obligations under the agreement, or that Messner Vetere relied to its detriment on the alleged oral agreement. Imposing the oral agreement on Aegis on the basis of its own part performance and in the absence of any performance by Messner Vetere is not consistent with the purpose of the part performance exception to the Statute of Frauds.
In addition, Messner Vetere's second claim for relief in which it seeks damages for breach of contract falls outside the statutory part performance exception of § 5-703(4) because it is not an equitable claim. Section 5-703(4) empowers "courts of equity to compel the specific performance of agreements," but makes no provision for an award of money damages. See Mauala v. Milford Management Corp., 559 F. Supp. 1000, 1003-04 (S.D.N.Y. 1983). Therefore, the statutory part performance exception of § 5-703(4) cannot rescue Messner Vetere's claim for damages from the Statute of Frauds.
Messner Vetere argues that § 5-701 of the Statute of Frauds applies, not § 5-703.
Section 5-701(a) of N.Y. Gen. Obligations Law provides in relevant part that:
Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking: (1) by its terms is not to be performed within one year from the making thereof ... (2) is a special promise to answer for the debt, default or miscarriage of another person.