Statute of Frauds

Question 1

Absent a statute that provides otherwise, oral contract . . .

Answer 1

are enforceable.

Question 2

Statute of frauds requires . . .

Answer 2

certain types of contracts to be written and signed by the party against whom enforcement is sought.

Question 3

What are the types of contracts that must be written?

Answer 3

1. Sale of interest in land
2. Sale of goods for $500 or more
3. Consideration of marriage
4. Not to be performed within one year
5. Suretyship

Question 4

What is suretyship?

Answer 4

Suretyship is the legal relationship that arises when one party (the surety) assumed the responsibility for a debt, default, or other failing for a second party.

Question 5

What interests are inclduded in “sale of an interest in land”?

Answer 5

• Leases for more than one year
• Easements for more than one year
• Mortgages and most other security liens
• Fixtures
• Minerals (or the like) or structure if they are to be severed (separated from the main estate) by the buyer

Question 6

What is contract not to be performed within one year?

Answer 6

A promise that by its terms cannot be performed within one year

Question 7

For contracts that are not to be performed within one year, when does the date start to run?

Answer 7

from the date of the agreement, not the date of performance

Question 8

Give 3 examples of contracts that do not fall within the statute of frauds rule for contracts not to be performed within one year.

Answer 8

1. if there is a possibility of completion iwthin one year, even if it’s not practical
2. lifetime contracts
3. where full performance by one party is already rendered

Question 9

What if a contract cannot be performed within one year but the parties have the right to terminate within one year? (majority vs minority)

Answer 9

Majority: Nonperformance does not impact; therefore, SOF applies.
Minority: Because contract is terminable within a year, SOF does not apply

Question 10

What is the UCC rule number for statute of frauds?

Answer 10

2-201

Question 11

What is the confirmatory memo rule under UCC for SOF?

Answer 11

If both parties are merchants, and a confirming memo of the contract is sent and received within a reasonable time, then an oral contract satisfies SOF. But if the recipient objects within 10 days, it does not satisfy SOF.

Question 12

What are the general writing requirements to satisfy SOF?

Answer 12

Must contain essential terms. enough to identify the parties and contract’s subject matter and general terms and conditoins of the agreement

Question 13

What is the signature requirement for SOF?

Answer 13

• liberally construed
• need not be handwritten (i.e., e signatures, from line on email, letterhead)

Question 14

When can a land sale contract be removed from SOF?

Answer 14

Buyer of land may seek specific performance for an oral contract for the sale of land through the part performance doctrice if at least two of the following are true:
* Payment in whole or part has been made
* Buyer is in possession of the land
* Buyer has made valuable improvements to the land

Question 15

When can a goods contract be removed from SOF?

Answer 15

Part performance is sufficient to remove SOF when:
* the goods have been specifically manufactured; or
* the goods have been paid for or accepted (if only partially paid for, only applies to extent of partial payment/acceptance)

Question 16

When does equitable and promissory estoppel remove a case from SOF?

Answer 16

When it would be inequitable to allow the SOF to defeat a meritorious claim. When a DF falsely and intentionally tells a PL:
* that the contract is not within the SOF; or
* That the DF will reduce the agreement to writing; or
* DF’s conduct foreseeably induces PL to change his position in reliance on an oral argument.

Question 17

When does judicial admission take a contract out of SOF?

Answer 17

If the party asserting the SOF defense admits in pleadings or testimony that there was an agreement, it is treated as though the statute is satisfied. The contract will be enforced without a writing.

Question 18

What is the effect of noncompliance with SOF? (majority)

Answer 18

Contract is voidable but not void.

Question 19

What is the effect of noncompliance with SOF? (minority)

Answer 19

Contract is void. this is a defense to formation, not merely enforcement.

Question 20

What happens if SOF is not raised as a defense?

Answer 20

waived

Question 21

What are the remedies if the contract is within SOF?

Answer 21

1. reasonable value of the services rendered; or
2. restitution of the value of the benefit conferred