Statute Of Frauds

Question 1

What are the two questions you should asked when dealing with SOF?

Answer 1

1. Does the SOF apply to this transaction?

2. Is so, has the SOF been satisfied?

Question 2

What is the mnemonic for the SOF?

Answer 2

Mr. SOUR

1. Marriage
2. Suretyship
3. One Year
4. UCC
5. Real Property

Question 3

What Marriage contracts are within the SOF?

Answer 3

A contract made in consideration of marriage (like a prenup).

Question 4

What Suretyship contracts are within the SOF?

Answer 4

A contract promising to guarantee the debt of another.

Question 5

What one-year contracts are within the SOF?

Answer 5

A contract that by its terms cannot be performed within one year from its making.

• The one year rule is interpreted very narrowly; the question is whether there is no possible way that the contract could be performed within one year.

Question 6

What UCC contracts are within the SOF?

Answer 6

Applies to goods contracts for a price $500 or more.

Question 7

What real property contracts are within the SOF?

Answer 7

A contract for the sale of interest in real property.

Question 8

What is the main purpose exception?

Answer 8

If the main purpose in agreeing to pay the debt of another is for the surety’s on economic advantage, then we are not in the statute of fraud’s world.

Question 9

What are the two ways to satisfy the SOF?

Answer 9

1. By performance.

2. By writing.

Question 10

How does performance satisfy the SOF for service contracts?

Answer 10

1. Full performance of a service contract by either side satisfies the statute of frauds.
2. Part performance of a service contract does not satisfy the statute of fraud.

Question 11

How does a writing satisfy the SOF?

Answer 11

A writing signed by the party against whom the contract is asserted.

Elements:
• indicating that a contract has been made;
• identifying the parties; and
• containing the essential elements of the deal.

Question 12

How does a real estate contract satisfy the SOF?

Answer 12

A sign writing will satisfy the statute of frauds.

Question 13

What is the exception to the real estate contract sign writing requirement?

Answer 13

Part performance of a real estate contract can satisfy the statue of frauds if any two of the following three elements are met:

1. Possession
2. Payment
3. Improvements to the landing

Question 14

When do goods need to be in a signed writing?

Answer 14

Goods that are $500 or more.

Question 15

What term need to be included in a UCC writing?

Answer 15

The writing must mention the quantity of goods that are sold.

• The contract is only enforceable under the SOF for the quantity mentioned.

Question 16

What are the three exceptions to UCC goods statute of fraud Writing requirement?

Answer 16

1. Part performance
2. custom – made (or specially manufactured) goods
3. Judicial admissions
4. Failure to object

Question 17

What is the part performance exception to the UCC statute of fraud?

Answer 17

A good contract satisfies the SOF, but only for the quantity delivered and accepted.

Question 18

What is the UCC statute of frauds custom made goods exception?

Answer 18

Custom made goods are exempt from the SOF.

• The maker can satisfy the SOF as soon as it makes a substantial beginning towards the manufacturing of the goods.

Question 19

What is the UCC judicial admission exception to the statute of frauds?

Answer 19

A judicial admission, such as a statement in a pleading or during testimony, satisfies the SOF under the UCC.

Question 20

What is the UCC Failure to object exception?

Answer 20

The failure to object to a confirming memo within 10 days will satisfy the SOF – but only if both parties are merchants.

• applies only if both parties are merchants.

Question 21

What is the equal dignity rule?

Answer 21

A signed writing to authorize an agent to form a contract that is is the SOF.

Question 22

Must a modification also satisfy the SOF requirement?

Answer 22

Depends whether the deal with the alleged modification will be in the SOF world.

• if so, the SOS requirements must be met;
• if not, there is no SOF requirement, even though the initial deal is in the SOF.

Question 23

What is the judicial admission exception to the UCC SOF?

Answer 23

Statements made in a pleading or during testimony, satisfies the SOF.