Defenses - Statute of Frauds Flashcards
Generally
a) Requires certain types of contracts to be in writing in order to be enforceable.
Suretyship promises
(1) For writing to be required:
(a) Must be a collateral promise (and not primary promise)
(i) Collateral = Give him the goods, and if he does not pay, I will.
(ii) Primary = Give him the goods and I’ll pay.
(b) Must be made directly to creditor
(c) Exception: Main Purpose Doctrine
(i) If the main purpose of the guarantor was to benefit himself, then no writing required.
Interests in land
(1) Sale of real property
(2) Leases for more than one year
(3) Mortgages
(4) Exception: Part Performance
(a) If seller fully performs (i.e., conveys), seller can enforce buyer’s oral promise to pay.
(b) Conduct that unequivocally indicates that the parties have contracted for the sale of land will take K out of SOF. Most courts require two of following three: part or full payment, possession, valuable improvements.
Performances not within one year
(1) A promise that by its terms cannot be performed w/in a year is subject to SOF and must be in writing.
(2) A K that is possible to complete w/in one year is not w/in SOF even though actual performance may extend beyond the one year (e.g., building a skyscraper).
(3) Ks measured by a lifetime is not w/in the SOF because it is capable of being performed w/in one year (e.g., could die tomorrow).
UCC 2-201(1)
Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker.
UCC 2-201(2)
(2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subsection (1) against such party unless written notice of objection to its contents is given within 10 days after it is received.
UCC 2-201(3)
A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable
UCC 2-201(3a)
If the goods are to be specially manufactured for the buyer and are not suitable for sale to others in the ordinary course of the seller’s business and the seller, before notice of repudiation is received and under circumstances which reasonably indicate that the goods are for the buyer, has made either a substantial beginning of their manufacture or commitments for their procurement
UCC 2-201(3b)
If the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted
UCC 2-201(3c)
(c) With respect to goods for which payment has been made and accepted or which have been received and accepted (UCC 2-606)
Writing requirements for SOF
a) Must contain essential terms and be signed by the party to be charged.
b) UCC = quantity, signature of party to be charged, writing sufficient to indicate that a K was formed.
Promissory estoppel
a) Promissory estoppel still applies even though a contract that would normally be required to be in writing is not.
