Transcript The Statute of Frauds - Villanova University

The Statute
of Frauds
Chapter 6
The Statute of Frauds
• To be enforceable, the following types of contracts
must be in writing and signed:
•
Contracts involving interest in land.
•
Contracts involving “One year rule.”
•
Collateral or Secondary Contracts.
•
Promise made in consideration of marriage.
•
Contracts for the sale of goods priced at
$500 or more.
Contracts Involving
Interest in Land
• Land includes the earth and all physical
objects that are permanently attached to the
soil:
• buildings, fences, trees.
• All contracts for the transfer of other
interest in land: mortgages and leases.
The One-Year Rule
•
A contract that cannot, by its own terms, be
performed within one year from the date it was
formed must be in writing to be enforceable.
• One-year period begins to run the day after the
contract is made.
•
Test: Whether performance is possible
(although unlikely) within one year.
Collateral Promises
• A collateral promise is one made by a third
party to assume the debts or obligations of a
primary party to a contract if that party does
not perform.
• Main Purpose Rule” Exception .
– If the main purpose of assuming secondary
liability is the guarantor’s personal benefit an
oral promise will be enforceable.
Contracts for the Sale of Goods
• UCC requires a writing or memorandum for
the sale of goods priced at $500 or more.
• Exceptions:
– Specially manufactured goods
– Admissions
– Partial Performance
Sufficiency of the Writing
• Common Law Rule: Writing must name the
parties, identify the subject matter, consideration,
and other essential terms, and
must be signed by the the party against whom
enforcement is sought.
UCC Rule. Must indicate that the parties intend a
contract and be signed by party against whom
enforcement is sought. Will not be enforcable
beyond the quantity shown. All other terms may
be proven by oral testimony.
Parol Evidence Rule
• If the court finds that the parties intended
their written contract to be a complete
and final embodiment of their agreement, a
party cannot introduce in court evidence
of any prior or contemporaneous oral
agreement or promise to contradict, alter or
modify to written contract.
Exceptions to
the Parol Evidence Rule
*Contracts subsequently modified.
*Voidable or Void contracts.
*Contracts containing ambiguous terms.
*Prior dealing, course of performance, or usage of
trade.
*Contracts subject to orally agreed-on conditions.
*Contracts with an obvious or gross clerical error
that clearly would not represent the agreement of
the parties.