Statute of Frauds

Question 1

General Rule of K law (oral promises enforceable)

Answer 1

contract need not be in writing and oral written agreements are equally enforceable.

Question 2

SOF Generally

Answer 2

SOF provides an exception to the general rule and makes some classes of ks unenforceable unless reflected in a signed writing

Question 3

SOF as a defense

Answer 3

General rule is that a k within the SOF is not enforceable absent a writing signed by the party against whom the enforcement is sought. So, if SOF defense is available and you are being sued for breach and did not sign a k that is within the SOF, it is available as a defense to you.

Question 4

SOF - Analyze by using these 3 questions

Answer 4

1. Does the agreement fall within the SOF? if not, SOF DNA
2. Is the SOF satisfied? If falls within SOF, check if SOF is met
3. Is alternative enforcement available? Check to see if promissory estoppel or quasi-k is available to enforce

Question 5

Specific Coverage under SOF - MYLEGS

Answer 5

1. Marriage
2. Ks not to be completed w/in 1 year of formation
3. k for SALE of interest in land
4. k of executor to answer for duty of decedent
5. K of Guaranty or Suretyship
6. K for sale of goods $500+ (see UCC)

Question 6

performance within one year

Answer 6

This is measured from the date of the K FORMATION. So if completion of the k cannot possibly be completed within a year, then SOF applies (Think: I contract today to work 1.5 years from now; can’t complete k in a year, SOF applies).

Question 7

Land-Sale K

Answer 7

This governs Ks for the sale of an interest in land. The K for future sale is governed by SOF, but present conveyance of land for money is not.
Lease of real property is governed by SOF b/c it’s a land interest

Question 8

Guaranty/Suretyship Agreements

Answer 8

General rule is that a promise to answer for the debt of a 3rd party is subject to SOF. 2 exceptions (these need not be in writing):

1. when creditor discharges original debtor from obligation on faith of a guarantee by a 3rd party to pay the debt
2. Main purpose exception - if main purpose of guarantor’s promise is to protect or promote his own economic interests

Question 9

Violation of SOF

Answer 9

if a k falls within the SOF, then the general rule is that the k is unenforceable unless evidenced by a writing signed by the party against whom enforcement is sought.

Question 10

SOF - the two requirements

Answer 10

1. a writing

2. signature

Question 11

SOF - the writing requirement

Answer 11

All that is necessary is that the writing be a memo of the actual agreement, which can be prepared before, during or after k formation.

Question 12

Examples of memos that satisfy SOF

Answer 12

1. letter from one party to a 3rd party describing the agreement
2. the written offer, acceptance of which formed the k
3. a letter from one party to the other repudiating, and so admitting, the agreement

Question 13

what terms are required in the memo under SOF?

Answer 13

1. identity of the parties to the transaction
2. the nature and subject matter of the k
3. the essential terms of the unperformed promises in the agreement

Question 14

SOF - Signature Requirement

Answer 14

the actual signature of the party again whom enforcement is sought is not necessary. Any symbol, including initials; typed, stamped, or preprinted signatures; or letterhead, if used with the intention to authenticate the writing, will suffice

Question 15

“Tacking together” multiple documents

Answer 15

the writing need not be a single document; a party may satisfy SOF by tacking together several documents which, once combined, satisfy all the necessary requirements for the SOF

Question 16

Land Ks and Part Performance

Answer 16

Part performance will make an oral k for the sale of land enforceable in two situations:

1. in an action by the buyer against the seller, but not in an action by the seller against the buyer
2. in an action for specific performance, but not in an action for money damages

Question 17

Land Ks and Part Performance - Elements

Answer 17

Part performance requires a showing of any combination of:

1. payment of all or part of the purchase price;
2. taking of possession; and
3. making substantial improvements to the property

Question 18

One Year Ks and Full Performance of Oral Ks

Answer 18

Full performance of an oral k for services by the party performing the services will make the k enforceable against the paying party.

Question 19

One Year Ks and Part Performance of Oral Ks

Answer 19

Part performance is not compensable on the k, but the performing party may be able to recover for the reasonable value of the services actually rendered via quantum meruit

Question 20

Sale of Goods K - UCC and Part Performance

Answer 20

UCC SOF may be satisfied by part performance of a sale of goods k . . . this is discussed later

Question 21

SOF not satisfied - Recovery of the Benefits Conferred

Answer 21

Where one bestows a benefit upon another in connection with an oral k, even if SOF bars enforcement, the performing party can file for restitution to seek recovery of value of the benefits conferred. In the alternative, if services are involved, the performing party can recover in quantum meruit for recovery of the reasonable value of the services he rendered

Question 22

SOF not satisfied - Promissory Estoppel

Answer 22

Where a party suffers losses in reliance on an oral k, though SOF bars enforcement, Promissory Estoppel may be available. The courts that do allow this apply for further requirements:

1. definite and substantial character of reliance, and its relationship to the remedy sought
2. the extent to which the reliance is corroborated by the E of the formation and terms of the k; and
3. extent to which formation and terms of k are otherwise established by C&C E

Question 23

UCC SOF - what happens when SOF not satisfied?

Answer 23

if the agreement falls within the UCC SOF and is not satisfied, then the whole thing is unenforceable.

Question 24

How to satisfy SOF UCC - 5 ways

Answer 24

1. signed writing
2. merchant’s confirmation
3. in-court admission
4. part performance
5. Substantial reliance by the seller of specially manufactured goods

Question 25

UCC SOF - Signed Writing

Answer 25

Signed writing requires:

1. a writing - any intentional reduction to tangible form
2. signed by the party against whom enforcement is sought
   a. any symbol executed or adopted w/present intention to authenticate the writing
3. sufficient to indicate that a k for sale has been made b/w the parties

Question 26

UCC SOF - Signed Writing & Qty terms

Answer 26

There must be a terms indicating the qty of goods sold in the transaction. The k is unenforceable beyond that amount. If no qty term, the k is unenforceable, unless:

1. writing provides basis for measuring qty
2. in output ks - term “output” or “requirements” (etc) satisfies the qty requirement

Question 27

UCC SOF v. Firm Offer

Answer 27

a written offer that proposes a sale of goods at a price of $500+ that meets the firm offers rule is enforceable against the signing merchant. UCC SOF is irrelevant.

Question 28

UCC SOF - Merchant’s Confirmation

Answer 28

A valid merchant’s confirmation requires a writing that:

1. is sufficient against the sender (signed by sender w/qty term)
2. is in confirmation of the k
3. is sent within a reasonable time of the making of the oral agreement
4. the contents of which the receiving merchant has reason to know (i.e. if sent by mail and never received, not good enough)

Question 29

UCC SOF - Merchant’s Confirmation - what happens when it is satisfied?

Answer 29

a confirmation that meets the foregoing requirements will satisfy the UCC SOF against the recipient unless the recipient provides written notice of objection to the confirmation’s contents within 10 days of receipt, but something purporting to be an objection and nonetheless has a signed writing (and satisfied UCC SOF) will satisfy the SOF against the “objector”
EX: Objector send notice to offeree saying “i know you already agreed to pay $5k, but I can’t b/c tax implications” –> UCC SOF satisfied

Question 30

UCC SOF - In court admission

Answer 30

UCC SOF satisfied when a party against whom enforcement is sought admits in his pleading, testimony, or otherwise in court that a k for sale was made. it is unenforceable beyond the qty established.

Question 31

UCC SOF - Part performance

Answer 31

Despite absence of signed writing, an otherwise valid k is enforceable with respect to goods for which payment has been made and accepted or which have been received and accepted

Question 32

UCC SOF - Part Performance & Divisible v. Indivisible Goods

Answer 32

1. Divisible - part performance secures enforcement for any qty that has already been paid for by the buyer or delivered by the seller; k not enforceable beyond that amount
2. Indivisible - Maj rule hold partial payment secures enforcement of the entire k (Min rule wont enforce unless there’s full pmt)

Question 33

UCC SOF - Specially Manufactured Goods

Answer 33

Aggrieved seller can enforce oral k by establishing:

1. Goods are to be specially manufactured for the buyer;
2. goods are not suitable for sale to others in the ordinary court of the seller’s business
3. seller has substantially begun to manufacture, or made commitments to procure, the goods . . .
4. . . . which occurred under circumstances that reasonably indicate that the goods are for the buyer; and . . .
5. . . . occurred before the seller received notice of the buyer’s revocation

Question 34

Enforcement where UCC SOF is not satisfied

Answer 34

Aggrieved party may be able to secure a remedy via promissory estoppel, but courts that do allow this have enhanced requirements such as unconscionability and unjust enrichment. All courts have allowed this for general contractors against subcontractors.

Question 35

Effect of satisfying SOF

Answer 35

If SOF is satisfied, you must still have a valid k. If you have a valid K and SOF applies, SOF must be satisfied

Question 36

No Mutuality of Obligation under SOF

Answer 36

Only that party against whom enforcement of the k is sought must have signed in order to enforce against him. It is not enforceable against the non-signing party. Exception: merchant’s confirmation