## Facts

- Thomas P. Gibson sued L.D. “Poke” Arnold and Deborah A. Arnold in federal court for conversion of several thousand head of cattle, seeking over $2 million.
- At a magistrate-judge settlement conference, the parties reached an oral settlement, but the terms were not put on the record.
- The undisputed material terms included: (1) a $400,000 confessed judgment in Gibson’s favor, designated nondischargeable in bankruptcy; (2) conveyance of a specified 640-acre tract to Gibson subject to one-half of an existing mortgage to be paid by Gibson; (3) a 10-year leaseback of the land to Arnold with specified annual rent; (4) additional multi-year cash payments including a final $100,000 payment at the end of year ten; and (5) release of the confessed judgment upon full performance.
- The conversion case was dismissed with prejudice after the settlement was reported.
- Arnold later refused to sign written settlement documents and repudiated performance.
- Gibson’s effort to enforce the settlement in the dismissed conversion case was denied on procedural grounds (failure to timely reopen).
- Gibson filed a separate breach-of-contract action to enforce the settlement; at trial Arnold admitted under oath that he agreed to the settlement terms.
- The district court held the settlement unenforceable under Oklahoma’s Statute of Frauds because it involved a land conveyance and obligations not performable within one year, and it entered judgment for Arnold.

## Issues

1. Whether Oklahoma’s Statute of Frauds bars enforcement of an oral settlement agreement involving land transfer and multi-year obligations when the party resisting enforcement unequivocally admits the agreement and its essential terms under oath.

## Decision

- The Tenth Circuit reversed and remanded.
- The court held the oral settlement agreement enforceable notwithstanding the Statute of Frauds.
- The court concluded that Arnold’s sworn admissions established the contract’s existence and essential terms, satisfying the statute’s evidentiary purpose and preventing its use to defeat a conceded agreement.

## Legal Principles

- The Statute of Frauds is intended to prevent fraud and perjury, not to provide a mechanism for a party to escape obligations it actually undertook.
- When the party asserting the Statute of Frauds judicially admits the existence and essential terms of an oral contract, the writing requirement may not bar enforcement because the evidentiary risk the statute targets has been eliminated.
- An oral settlement agreement may be enforced as a contract when its material terms are definite and conclusively established, including through sworn admissions.

## Conclusion

The court held that an in-court oral settlement covering land and long-term performance was enforceable because the resisting party’s unequivocal sworn admissions removed the Statute of Frauds’ evidentiary concerns; the judgment for the defendants was reversed and the case remanded for further proceedings.


Gibson v. Arnold, 288 F.3d 1242 (10th Cir. 2002)