Here’s the short version: While working on the newer incarnation of “Beverly Hills 90210,” Brian Austin Green apparently started dating co-star Vanessa Marcil-Giovinazzo. During the course of their courtship, Green lent Marcil approximately $200,000 in $50,000 increments. This was in the year 2000. In November of 2011, Green tried to collect on his loans to no avail. So Brian Austin Green filed a lawsuit against Ms. Marcil-Giovinazzo (PDF). Will he be able to enforce that agreement through the courts?
The lawsuit alleges, among other things, breach of contract and breach of oral agreement. Since the Complaint (linked above) does not include the supposed written contract, we will assume that there is only an oral contract. But what’s the point of trying to enforce an oral agreement? You can’t prove an oral agreement so it can’t be enforced, right? Not quite.
Oral contracts are just as valid as written contracts in most situations. The only difference between the two is that without something in writing, the terms of the contract are much harder to prove. But if there are circumstances evidencing a contract (for example, a witness to the agreement, or acceptance by performance), it is possible to enforce an oral contract just as one would enforce a written contract. So long as there is an offer, acceptance, and consideration, an oral contract can be enforced.
There are situations in which an oral contract is not accepted, however, and these are covered by what is known as the Statute of Frauds. The statute of frauds is typically governed by statute (no surprise there), and requires that certain types of agreement be in writing to be enforceable. Traditionally these agreements involve marriage by contract, contracts that will take over one year to perform, contracts for the transfer of land, and other situations involving executors, guarantors for someone else’s debt, and sales of goods. In Mr. Green’s claim, none of these apply, so the statute of frauds does not require that a written contract exist in order to enforce the agreement.
Some of you who are in the know might be tempted to claim that the Statute of Limitations precludes a claim for this amount of money. The statute of limitations is a time period set by the state or federal government during which certain types of claims must be made. These differ from state to state and claim to claim. Generally, though, if you try to bring a claim that is outside the statute of limitations, it will be dismissed. The purpose of statutes of limitation is generally to ensure that claims are brought within a time when the evidence is fresh or to ensure that the claim is fair. For instance, in Minnesota the statute of limitations on construction claims is 10 or 12 years (depending on the circumstances), to keep construction companies for being liable for anything that fails at any point in the future. It’s not fair to expect that construction will last forever, so there is a limit on the time period within which a person can bring a claim.
All that being said, Mr. Green’s claim does not exceed the statute of limitations for a breach of contract claim because the demand for the return of the money didn’t occur until November of 2011. So it has really only been 2 months since the breach occurred, which I would guess is within every state’s statute of limitations for breach of contract.
But if Mr. Green can’t show a written contract, he has a significant problem outside the scope of contract law, which involves the difference between a loan and a gift. A loan involves contract law because there is a promise to pay money back under certain circumstances in exchange for being loaned that money up front. A loan involves an offer, acceptance and consideration. A gift, however, does not involve any consideration. In other words, the person giving the gift does not ask for anything in return for giving the gift, so a gift cannot be a contract.
This is a potential problem for Mr. Green because in the case of being in a romantic relationship, undocumented loans are generally considered gifts. Oftentimes after a relationship has gone sour, people will try to retroactively claim that a gift was actually a loan and demand to have it returned. But all that matters for the purposes of the law is the intent at the time the money was given. If there is no documentation of the loan and the parties were romantically involved at the time, Mr. Green is going to be hard-pressed to prove that the $200,000 is a loan rather than a gift.
At the end of the day, this case probably turns on whether there is a written agreement. If so, it will be easy to prove a loan and the terms of that loan. If not, then although the statute of frauds does not apply, the money will likely be presumed to be a gift in light of their relationship at the time, and proving any sort of terms of a loan without any other evidence will be nearly impossible.
Good luck, Brian Austin Green. You’re going to need it.
(photo: http://www.flickr.com/photos/lovelornpoets/6214449310/)
About Graham Martin
Graham Martin is a solo practitioner focusing on Contract law (including drafting, review, and litigation). He operates Martin Legal Services, LLC in the Minneapolis-St. Paul area.
