William J. Jenack Estate Appraisers and Auctioneers, Inc. sold fine art and antiques at public auctions. Albert Rabizadeh wanted to buy a nineteenth-century Russian silver and enamel box, with an estimated value of $4,000, that was to be sold at one of Jenack’s auctions. Rabizadeh could not attend the auction, so he submitted an “absentee bidder form,” in accordance with Jenack’s online and telephone bidder policy. Rabizadeh signed the form and listed his name, email address, telephone numbers, fax number, address, credit card number, and the items that he intended to bid on. Jenack assigned Rabizadeh bidder number 305.

The rare Russian box garnered much excitement from collectors who believed it was worth much more than its initially appraised value of $4,000. During the frenzied auction, Rabizadeh beat out many other bidders with a telephone bid of $400,000. (Yes, that is two zeros more than $4,000—it was quite a box.). Jenack recorded Rabizadeh’s winning bid on an official “clerking sheet,” along with the item, its description, and bidder number 305. When he received Jenack’s invoice, Rabizadeh decided he did not want it anymore and refused to pay. 

Jenack sued Rabizadeh for breach of contract. Rabizadeh claimed that there was no contract because the sale was not in a signed writing, as required by the UCC for goods over $500. Jenack argued that the clerking sheet and related documents satisfied the writing requirement, because they contained all the necessary terms. The trial court agreed with Jenack and awarded it $402,398. A New York appeals court reversed the decision. Jenack appealed to New York’s highest court.

Questions:

1. Did the clerking sheet and the absentee bidder form satisfy the Statute of Frauds?

2. Why wasn’t the clerking sheet alone sufficient to satisfy the Statute of Frauds?

3. Why doesn’t UCC Section 2-201(2), the Merchant’s Exception, apply in this case?

4. What is the purpose of the Statute of Frauds? Was it being utilized for this purpose by Rabizadeh?