## Facts

- Gold Kist, Inc. operated a peanut shelling plant in Comyn, Texas and owned trucks and peanut-hauling equipment used to move peanuts from buying points to the plant.
- In August 1986, Gold Kist’s plant manager approached Edward C. Carr, Jr. about purchasing Gold Kist’s trucks and hauling equipment.
- The parties negotiated with the understanding that any deal required corporate approval.
- The parties executed a final written agreement for Carr to buy the trucks and equipment and related obligations were memorialized in a promissory note.
- The written agreement stated that Gold Kist had no obligation to engage Carr to haul peanuts.
- Carr later claimed Gold Kist had promised him exclusive hauling of Gold Kist’s peanut commodities in Texas during the term of the promissory note and that he relied on that promise in purchasing the equipment.
- After Carr received less hauling work than he expected in subsequent seasons, he sued for breach of contract, promissory estoppel, and fraud.
- A jury found for Carr, awarded $570,401 in actual damages for multiple seasons and $250,000 in exemplary damages, and the trial court entered judgment accordingly, while granting Gold Kist an offset of $36,568.41 on its counterclaim for the unpaid note balance.

## Issues

1. Whether the parol evidence rule barred evidence of an alleged oral promise of exclusive hauling rights that contradicted an unambiguous written clause stating Gold Kist had no obligation to use Carr for hauling.
2. Whether an alleged multi-year exclusive hauling agreement was unenforceable under the Texas statute of frauds because it was not performable within one year and was not evidenced by a signed writing.
3. Whether promissory estoppel could provide an equitable basis to enforce the alleged exclusivity promise notwithstanding the statute of frauds.
4. Whether the evidence was legally sufficient to support fraud and exemplary damages based on a representation that Carr would receive exclusive hauling rights.

## Decision

- The court reversed Carr’s recovery and rendered judgment that Carr take nothing on breach of contract, promissory estoppel, and fraud.
- The court held the written contract was unambiguous that Gold Kist had no obligation to use Carr for hauling, and parol evidence could not be used to add or contradict an exclusivity obligation.
- The court held any oral promise of exclusive hauling during the multi-year promissory note term fell within the statute of frauds and was unenforceable absent a sufficient signed writing.
- The court held promissory estoppel did not apply to avoid the statute of frauds on these facts and could not be used to enforce an oral term that contradicted the written agreement.
- The court sustained Gold Kist’s legal-sufficiency challenge to the fraud findings tied to the alleged exclusivity representation and reversed the actual and exemplary damages awarded on that theory.
- The court affirmed the portion of the judgment awarding Gold Kist an offset of $36,568.41 on its counterclaim for the promissory note balance.

## Legal Principles

- When a written contract is unambiguous, it is enforced as written, and prior or contemporaneous oral statements may not be admitted to vary or contradict its terms under the parol evidence rule.
- An alleged agreement not performable within one year is unenforceable under the Texas statute of frauds absent a writing signed by the party to be charged that evidences the essential terms of the agreement.
- Promissory estoppel operates as only a limited exception to the statute of frauds and generally requires a promise to sign, or to reduce to writing, an agreement that would satisfy the statute; it does not enforce an oral term that contradicts an integrated written contract.
- A fraud recovery cannot be sustained where the asserted misrepresentation is inseparable from an unenforceable or contradicted contractual promise and the record does not support the required showing of actionable misrepresentation and legally sufficient proof of the fraud findings.

## Conclusion

The appellate court set aside a jury verdict premised on an alleged oral, multi-year exclusive hauling arrangement because the written contract expressly disclaimed any obligation to use the hauler, the statute of frauds barred enforcement of the asserted exclusivity promise without a signed writing, promissory estoppel did not apply to avoid that bar, and the fraud and exemplary-damages findings lacked legally sufficient support; only Gold Kist’s offset on the promissory note was affirmed.


Gold Kist, Inc. v. Carr, 886 S.W.2d 425 (Tex. App.—Eastland 1994, no writ)