In re Estate of Giguere provides an example of an oral modification delaying the accrual of a cause of action based on a written instrument. See 366 N.W.2d 345 (Minn. Ct. App. 1985). In that case, a borrower obtained a loan in 1969 evidenced by a promissory note payable in 90 days.
II. Extension of the Statute of Limitations by Oral Representation The Creditors rely on In re Giguere, 366 N.W.2d 345 (Minn.App. 1989) to argue that an oral agreement to repay can extend the statute of limitations. In that case, Mr. Giguere borrowed money on a 90 day note and failed to repay when demand was made at the end of the 90 days.
Utilizing these same contract principles, we have upheld the validity of an oral agreement to modify the subsequent performance of a debtor relative to a promissory note. See In re Estate of Giguere, 366 N.W.2d 345, 346-47 (Minn. App. 1985). Even without a specific writing, if there is other sufficient evidence of an agreement for forgiveness of debt, such agreement is binding upon the parties.
See, e.g., In re Estate of Giguere, 366 N.W.2d 345, 347 (Minn.App. 1985) (oral agreement to delay enforcement of past-due promissory note). By postponing the date on which performance is due, the parties effectively postpone the date when a claim based on the debtor's failure to perform accrues.
The parties may modify their agreement by extending the time for performance of a contract. In re Estate of Giguere, 366 N.W.2d 345, 347 (Minn. Ct. App. 1985) (citing Thoe v. Rasmussen, 322 N.W.2d 775, 777 (Minn. 1982)).
First, the parties may orally agree to waive or modify a contractual term requiring the debt to be paid by a certain date. See Inre Estate of Giguere, 366 N.W.2d 345, 347 (Minn. App. 1985) ("Our prior decisions hold that an oral agreement that modifies the method or time for performance is valid and not subject to the statute of frauds."). By extending the date of payment, i.e. the time when performance is due, the parties also effectively postpone the date when a claim based on the debtor's failure to perform accrues.
Parol evidence is admissible to show a subsequent modification of an original contract. Nord, 305 N.W.2d at 339-40; see also In re Estate of Giguere, 366 N.W.2d 345, 347 (Minn.App. 1985) (allowing parol evidence to show a new agreement between the parties that delayed enforcement of a promissory note by giving time extension for payment). In this case, however, appellants do not wish to offer parol evidence to prove a subsequent modification, but to contradict the unambiguous terms of the original writing.
Nor does an oral extension violate the Statute of Frauds. In re Estate of Giguere, 366 N.W.2d 345, 347 (Minn.App. 1985); see also Hafiz v. Midland Loan Fin. Co., 206 Minn. 76, 287 N.W. 677 (1939). Appellant attempts to distinguish this case because the oral acknowledgement was made after the statute of limitations had run.