ContractsChapter 3.A. Statute of Frauds
Ch. 3.A. Statute of Frauds 1
Statute of Frauds
Origin: English Statute of Frauds in 1677
Today: Statutes, with variations, continue in U.S. states
Why require a writing?Should a writing be required for all
contracts?Are there any disadvantages to the
requirement?Ch. 3.A. Statute of Frauds 2
Statute of Frauds: Mechanics1. SCOPE: Is the contract within the statute?• If yes, then go to step 2.• If no, then stop.
2. SATISFACTION: If the contract is within the statute, has the statute been satisfied?
1. If yes, then stop.2. If no, then go to step 3.
3. EXCEPTION: If the statute has not been satisfied, do other facts prevent application?
If yes, then stop. If no, then go to step 4.
4. EFFECT: If statute is not satisfied and there is no exception, is party seeking to enforce contract?
If yes, contract is UNENFORCEABLE. If no, then Statute does not apply.
Ch. 3.A. Statute of Frauds 3
Scope: Covered Contracts
Original categories (Rest. (2d) §110)1.Executor-administrator2.Suretyship3.Marriage4.Land Interests5.One-Year
UCC 2-201: $500 or more ($5000 in amended version)
Ch. 3.A. Statute of Frauds 4
Statute of Frauds 5
SCOPE: Suretyship & ExecutorPromisor is a surety if
1. makes a promise to creditor2. to do that which will discharge debtor’s
duty3. S makes the promise for debor’s benefit
and not primarily for own benefit.Executorship provision is interpreted
the same way.Surety does not include novation
(Rest. 115) or indemnification (insurance).Ch. 3.A.
Statute of Frauds 6
SCOPE: Sale of an Interest in LandAn “interest in land” depends on
property law. Rest. (2d) defines as “any right, privilege, power or immunity… which is an interest in land under property law.”
Ch. 3.A.
Statute of Frauds 7
SCOPE: Sale of Goods
UCC §2-201 covers contracts for sales over $500. Some states have adopted a proposed
increase to $5,000 threshold.
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Statute of Frauds 8
SCOPE: One-Year Provision
K is only within 1-year clause if BY ITS TERMS it is not to be performed within 1 year of its making.
How does Klewin court interpret this rule?
How does this contrast with McInerney court’s position?
Which approach is better?
Ch. 3.A.
SATISFACTION: Signing and Writing Requirements
Who must sign? What exception does the UCC create to
this rule?What must the writing reflect?
What is the issue in Bazak International? How does the court resolve it?
What term(s) must be included in the writing? How does the Crabtree court find a
sufficient writing to satisfy the statute?Ch. 3.A. Statute of Frauds 9
EXCEPTION: Statute May Not Apply
Rest. (2d) categories Full performance by one side in 1-year K (130(2)) Protected reliance due to part performance (139;
Chomickey)UCC 2-201(3)
1. Special-order goods started or commitment to procure
2. Admission in pleading or testimony3. Goods
1. for which payment has been made and accepted, or2. that have been received and accepted.▪ NOTE: Performance (partial or complete) validates
performed portion of contract only.Ch. 3.A. Statute of Frauds 10
EFFECT: Consequences of Not Satisfying the Statute of Frauds
Noncompliance prevents enforcement of contract, but does not void contract. It can still be used as evidence of something else.
SOF defense can be waived intentionally (e.g., fail to raise in pleadings) by admissions in legal filings or sworn testimony.
Charged party may be equitably estopped from asserting defense if the party represented I will prepare a writing. A writings has already been prepared. No writing is necessary.
Ch. 3.A. Statute of Frauds 11
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