Contracts in Writing Flashcards
If some contracts are not in writing =>
they are not enforceable
Statutes of fraud
Require that certain contracts be evidenced by a satisfactory writing
*These statutes are the prime refuge of the scoundrel who has made a deal and then seeks to welch on it
Wisconsin Agreements: all have to be in writing
Every agreement that by its terms is not to be performed within one year from the making thereof
Every special promise to answer for the debt, default or miscarriaige of another person
Every agreement, promise or undertaking made upon consideration of marriage, except mutual promises to marry
Other general observations about contracts
- Most contracts do not have to be evidenced by a writing
- “Important” contracts should be evidenced by a writing regardless of whether or not a statute requires a writing
- Did the parties intend that they would have no contract unless and until a written contract was signed and delivered?
Guarantee (or suretyship) contracts
“If X doesn’t pay, I will pay…”
Applies to collateral (or secondary) promise - promisor not primarily liable, but only liable if the party whose performance is guaranteed fails to perform
*must be in writing
Exception - main purpose doctrine
Where the object of the guarantor is to obtain an economic benefit that he or she did not previously share
interests closely aligned
*must be in writing
Contracts involving interests in Real Estate
Must be in writing
types of contracts (purchase/sale, mortgage, leases, easements, licenses, etc.)
exception: real estate lease with a term of one year or less
Contracts incapable of performance within one year from the date made
Must be in writing
One year from the date performance is to begin
Key point about writing of contracts
Writing need not be a formal document nor must all terms be include din single writing (can draw several writings together to prove existnce of contract)
not a lot of formalities
Writings include
- Identification of parties
- Identification of subject matter and consideration
- “signed” by the party against whom enforcement is sought
*signature - any mark or symbol intended to ahtenticate
What will satisfy writing requirement?
Written agreements
Letters
Daybook notations
other writings - whether or not the parties intended the writing to have legal consequence
Effect of an under-oath admission that contract exists
contract is still not enforceable in a majority of jurisdictions
Equitable recovery based on promissory estoppel
may be available to avoid an unjust result from a contract being declared unenforceable
i.e. the party against whom enforcement is sought is unjustly enriched by being able to avoid contractual responsibility
Partial performance exception - no writing required if buyer has:
Generally limited to sales of real estate
- made a partial payment of the price
- taken possession of the real estate
- added substntial improvements (constructed a building)
Sales of Goods Statute of Frauds
a. application - sale of goods with a price of $500 or more
b. contracts for services not covered - mixed contracts?
- what is the primary purpose?
Writing required - very lenient requirements- the writing must
- evidence contractual intent
- be “signed” by party to be charged with performance (the “scoundrel”)
- specify some quantity of goods
Use of confirmations between merchants
- merchant only section
- party desiring contract must prove oral contract in fact was formed
- if recipient of confirmation fials to respond to it in writing within 10 days after receiving it, he is bound by the confirmation even though he did not sign it
- receipt of confirmation
Exceptions to any writing requirment under 2-201
- oral contract for specifically manufactured goods (must prove oral contract in fact existed)
- admission under oath by party against whom enforcement is sought
- partial acceptance or payment by buyer in an installment contract situation
- one year rule could still cause contract even if these exist
Modifications of contracts
Does the contract, as modified, have to be in writing?
Yes, if price is $500 or more after modification
1-206
other personal intangible property 5,000 limit
8-319
securities
9-203
security agreements
2A - 201
leases of goods
Use of customary forms
Minimizes risk of failing to comply with a statute of frauds
banking forms, real estate forms, broker’s forms, computer generated receipts at retail stores
Biggest risk
transactions that are not entered into in well-established business environments
Electronic “record”
satisfies the writing requriement
electronic signature
satisfies the signature requirment
cliking an i agree button
Parol Evidence Rule
Only important if disputed contract is in writing
Generally the product of numerous different types of communications between the parties
parol evidence refers to anything (besides contract) that was said, done or written BEFORE the parties signed the contract or as they signed it
Contract must have been intended to be complete and final expression of agreement
Exceptions to the inadmissiibility of evidence baased on parol evidence rule
- party written, partly oral contracts (parties did not intend that the written portin of the contract be integrated)
- collateral errors
- lack of capacity (minority)
- defense of fraud , misrepresentation, duress, undue influence
- existence of conditions which make conditional a party’s obligations under a contract
- a later agreement
- clarify an ambiguity
