Statute of Frauds

Law Midterm

4 Principles of Statute of Frauds

contracts involving land/real estate provisions, 1yr rule, collateral/secondary promise, sale of goods of $500 or more

statute of frauds

law that requires some contracts to be in writing and signed by the parties involved to be enforceable

Rule: Contracts involving interest in land/real estate provisions

Real estate contract must be in writing (rental agreement, mortgage, purchase house)

Exceptions: Contracts involving interest in land/real estate provisions

leases/rental agreement for 1 yr or less don’t need to be in writing to be enforced in court of law, doctrine of park performance

Doctrine of park performance

if purchaser of rare property does in oral/not signed contract it will be enforced= pay part of purchase price/deposit, starts moving on property, and makes renovations

1-year rule

contracts that can’t be performed in one yr must be in writing; any contract (not real estate) usually employment contract situation, must distinguish if oral contract must be in writing in statue or one exception applies and doesn’t have to be in writing

Rule: Collateral/secondary promise

promise to pay debt if debtor doesn’t pay (cosigning situation); third person agrees to pay debt of other person if other stops making payments; Must be in writing to pay the debt of someone else should they not be able to pay their own debt; usually made as a favor to help someone out

Exception: Collateral/secondary promise

late purpose rule

late purpose rule

if purpose of 3rd party is for their own selfish benefit then the oral collateral promise is enforceable

Rule: Sale of goods of $500 or more

under UCC sale of good must be in writing for sale of good $500 or more this rule applies to everyone; As long as parties intended contract and it was signed by the defendant, typed name and initials count

Exception: Sale of goods of $500 or more

Special rules for merchants/merchant memo rule, specially manufactured good

Special rules for merchants/merchant memo rule

if 2 merchants make contract for sale of good 500 or more if merchant a sends to b contract and b can send rejection within 10 days if sends late or doesn’t send, then no written need (2 merchants agree to contract orally, send confirm letter to merchant b, merch b doesn’t reject then confirmation letter is evidence of transaction and contract will be enforced)

Specially manufactured good

sale contract of 500 or more not in writing if goods custom and nobody else wants the, if manufacturer started to make goods or finished making them, then it does not have to be in writing and contract can move forward