## Facts

- Michelle Rosenfeld, a New York art dealer, alleged that on October 25, 1982, Jean-Michel Basquiat agreed to sell her three paintings for $4,000 each.
- Rosenfeld claimed she paid Basquiat a $1,000 cash deposit and that Basquiat memorialized the deal in a handwritten crayon document.
- The writing listed the three paintings, stated “$12,000–$1000 DEPOSIT–OCT 25 82,” and bore both signatures.
- Rosenfeld asserted Basquiat asked her to wait at least two years for delivery so he could exhibit the works; the paintings’ current whereabouts were unknown.
- Rosenfeld sued Basquiat’s estate administrator in federal court (diversity jurisdiction) seeking damages or specific performance based on the alleged contract.
- At the first trial, the estate initially invoked New York’s Dead Man’s Statute (CPLR 4519) to bar Rosenfeld’s testimony about transactions/communications with Basquiat, but ultimately allowed her to testify; the jury deadlocked and a mistrial was declared.
- At the second trial before a different judge, Rosenfeld did not testify live; the court admitted portions of her first-trial testimony under Federal Rule of Evidence 804 (former testimony), over the estate’s objection based on CPLR 4519 and hearsay.
- The jury returned a verdict for Rosenfeld and awarded damages measured by the paintings’ market value; the estate appealed.

## Issues

1. In a diversity action, whether New York’s Dead Man’s Statute (CPLR 4519) barred admission at a second trial of a plaintiff’s prior testimony describing personal transactions and communications with the decedent, and whether Fed. R. Evid. 804 could nonetheless permit admission.
2. Whether the alleged crayon writing satisfied the U.C.C. statute of frauds for a sale of goods, or rendered the contract unenforceable due to informality or missing terms (including delivery).

## Decision

- The Second Circuit reversed the judgment and remanded for a new trial.
- The court held that CPLR 4519 rendered Rosenfeld incompetent to offer testimony about personal transactions/communications with the deceased when offered against the estate, and the district court erred by admitting the same substance through her prior testimony.
- The court held Fed. R. Evid. 804 addresses hearsay and does not override state-law witness competency rules applicable in diversity cases.
- The court rejected the estate’s statute of frauds defense, concluding the writing satisfied U.C.C. § 2-201 despite lacking delivery and other detailed terms.
- The erroneous admission of the barred testimony was not harmless because it was central to proving the asserted contract.

## Legal Principles

- In diversity cases, federal courts apply state rules of witness competency, including New York’s Dead Man’s Statute (CPLR 4519), to prevent forum shopping and inequitable administration of the laws.
- CPLR 4519 bars an interested witness from testifying, against an estate, about personal transactions and communications with the decedent; the bar applies to the substance of the testimony, not merely the mode of presentation.
- Federal hearsay exceptions (including Fed. R. Evid. 804 former testimony) do not permit admission of testimony that state law deems incompetent in a diversity action.
- For a sale of goods, U.C.C. § 2-201 requires only a writing that indicates a contract, is signed by the party to be charged, and specifies quantity; it need not contain all material terms.
- Missing terms such as delivery time do not defeat enforceability where the U.C.C. supplies default standards (e.g., reasonable time).

## Conclusion

The Second Circuit ordered a new trial because the plaintiff’s first-trial testimony about dealings with the deceased artist was barred by New York’s Dead Man’s Statute and could not be admitted via a federal hearsay exception, even though the informal signed writing was sufficient to satisfy the U.C.C. statute of frauds.


Rosenfeld v. Basquiat, 78 F.3d 84 (2d Cir. 1996)