## Facts

- ConAgra, Inc., operating a grain elevator in Shelby, Montana, regularly bought and sold grain.
- Ralph and Dennis Nierenberg farmed near Shelby and regularly marketed wheat through local elevators.
- On April 9, 1996, Dennis Nierenberg telephoned ConAgra’s elevator manager to discuss selling the Nierenbergs’ wheat.
- ConAgra contended the call resulted in an agreement to sell 12,500 bushels at $5.01 per bushel, and ConAgra internally recorded the deal on its customary order documentation.
- Wheat prices were rapidly increasing during the relevant period.
- ConAgra prepared a written confirmation of the alleged oral agreement; after initially holding it for pickup, ConAgra mailed it when Dennis did not appear.
- Dennis received the confirmation about ten days after the call, attempted to reduce the quantity to 10,000 bushels, and indicated he would consult counsel because the confirmation was unsigned by him.
- The Nierenbergs sold the wheat to another elevator without notifying ConAgra; ConAgra later obtained replacement wheat at a higher price and sought the price difference as damages.
- ConAgra sued for breach of an oral contract; the Nierenbergs asserted the UCC statute of frauds as an affirmative defense.
- After a bench trial, the district court entered judgment for the Nierenbergs, concluding ConAgra failed to prove an enforceable oral agreement and that the statute of frauds barred enforcement.

## Issues

1. Whether the evidence required a finding that Dennis Nierenberg, acting for the Nierenbergs, admitted making a contract to sell wheat to ConAgra.
2. Whether the written confirmation was received within a “reasonable time” under UCC § 2-201(2).
3. Whether the Nierenbergs were estopped from denying contract formation or from asserting untimely confirmation.
4. Whether substantial credible evidence supported the existence of an April 9, 1996 agreement to sell 12,500 bushels to ConAgra.

## Decision

- The Montana Supreme Court reversed the judgment for the Nierenbergs and remanded.
- The court held Dennis Nierenberg qualified as a “merchant” under the UCC based on regular grain marketing and familiarity with the trade.
- The court held the transaction fell within UCC § 2-201(2)’s between-merchants confirmation rule.
- The court concluded receipt of ConAgra’s written confirmation about ten days after the phone agreement was within a reasonable time on these facts.
- Because the Nierenbergs did not object in writing within ten days after receipt, they could not invoke the statute of frauds to defeat enforcement of the oral contract.
- The court determined the district court’s contrary findings and statute-of-frauds analysis were not supported under the governing standards and UCC framework.

## Legal Principles

- Under UCC § 2-201(1), a contract for the sale of goods for $500 or more generally requires a writing signed by the party to be charged.
- Under UCC § 2-201(2), between merchants, an oral contract may be enforced if a written confirmation sufficient against the sender is received within a reasonable time and the recipient fails to object in writing within ten days.
- A farmer who regularly markets grain and is familiar with grain-trade practices may be a “merchant” for UCC purposes.
- “Reasonable time” under UCC § 2-201(2) is assessed in light of commercial practice and the parties’ conduct; market volatility does not, by itself, make a short delay unreasonable.
- In reviewing a bench trial, appellate courts assess whether findings are supported by substantial credible evidence and whether legal conclusions correctly apply the UCC.

## Conclusion

The Montana Supreme Court held the alleged oral wheat-sale agreement was enforceable under UCC § 2-201(2) because the parties were merchants, ConAgra’s written confirmation was received within a reasonable time, and the Nierenbergs did not timely object in writing, requiring reversal and remand for further proceedings.


ConAgra, Inc. v. Nierenberg, 301 Mont. 55, 7 P.3d 369 (Mont. 2000)