Statute of Frauds

Question 1

WHEN IS A WRITING REQUIRED BY THE STATUTE OF FRAUDS?

Answer 1

(1) Transfer of an interest in REAL property
- Includes leases and easements
- Authorization of an agent to sell real property also must be in writing
(2) Performance CANNOT be completed within one year
- If full performance within a year is theoretically possible, no writing is required (e.g. specific tasks)
(3) Sale of Goods for $500 or more
(4) Lease of Goods for $1000 or more
- UCC ARTICLE 2A - NY ONLY
(5) Suretyship
(6) Contract Modification
- ONLY IF K as modified is within SOF

Question 2

LIFETIME CONTRACTS + THE STATUTE OF FRAUDS

Answer 2

MBE: lifetime contracts do NOT fall within SOF
NY: lifetime K’s DO fall within SOF - writing required

Question 3

MISCELLANEOUS NY PROVISIONS FOR SOF

Answer 3

Assignment of an insurance policy
Promise to pay a discharged debt
Agreement to pay a finder’s fee or broker’s commission
–> EXCEPT to an attorney, auctioneer, or licensed real estate agent

Question 4

ORAL MODIFICATION AND THE COMMON LAW

Answer 4

Clauses that prohibit oral modification are NOT enforceable

Can always modify a K orally under common law, even if you have agreed not to

Question 5

ARTICLE 2 SALE OF GOODS- SATISFACTORY WRITING

Answer 5

(1) A quantity term

2) Signature of the party to be charged with breach (defendant

Question 6

ARTICLE 2A LEASE OF GOODS - SATISFACTORY WRITING

Answer 6

(1) Statement that the writing is a lease
(2) Quantity
(3) Duration
(4) Rental payments
(3) Signature of the party to be charged with breach (defendant)

Question 7

ANY OTHER CONTRACT (NOT ARTICLE 2 OR 2A)- SATISFACTORY WRITING

Answer 7

(1) All material terms
- Who and what
(2) Signature of the party to be charged with breach (defendant)

Question 8

EXCEPTIONS TO THE STATUTE OF FRAUDS

Answer 8

(1) Real Property
- Leases of one year or less
- Part Performance
(2) Full Performance
(3) Sale of Goods >$500 IF:
- Goods accepted or paid for by buyer
- Custom-made goods
- Judicial admissions
- Merchant confirmatory memo
(4) Suretyship
- Main Purpose Exception
- NOT recognized in NY

Question 9

PART PERFORMANCE EXCEPTION TO SOF

Answer 9

Requires 2 of 3 facts

(1) Buyer is in possession of the property
(2) Buyer made some payment, OR
(3) Buyer made improvements to the property

Question 10

FULL PERFORMANCE TO SOF

Answer 10

If X has fully performed and Y refuses to pay, the exception applies and no writing is needed to enforce the K even though the original K should have been in writing

Question 11

SOF EXCEPTION - GOODS PAID FOR OR ACCEPTED BY BUYER

Answer 11

Exception ONLY applies to those goods accepted or paid for, not the whole K

Question 12

SOF EXCEPTION - CUSTOM MADE GOODS

Answer 12

Where there has been a SUBSTANTIAL START and the goods are NOT suitable for sale to others in the ordinary course of business

Question 13

SOF EXCEPTION - MERCHANTS’ CONFIRMATORY MEMO

Answer 13

One party can use its OWN signed writing to satisfy the SOF against the other party if:

(1) Both parties are merchants
(2) Writing claims a prior agreement/has quantity
(3) There is no written objection within 10 days

Question 14

SOF EXCEPTION - SURETYSHIP AND MAIN PURPOSE

Answer 14

MBE: if the surety’s main purpose in making the promise is to benefit HIMSELF, no writing is required for enforcement

IN NY: NO main purpose exception - always need a signed writing for a suretyship