Statute of Frauds Flashcards

Learn about the Statute of Frauds and when it applies to contracts.

1
Q

Define

Statute of Frauds

A

Holds some K’s as unenforceable unless in writing

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2
Q

To satisfy the Statute of Frauds, a writing needs to contain:

A
  1. Reasonably identify the subject matter of the K
  2. Essential elements of the deal; and
  3. Be signed by the party asserting the SOF defense

⚠️Note: Writing does not need to be formal (e.g. correspondence will suffice) and can be done during or after K formation

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3
Q

When does performance satisfy the SOF?

A

For:

  1. Service K’s (full performance satisfies SOF)
  2. Unique or custom made goods (substantial beginning towards performance)
  3. Real estate K’s if buyer does 2 of the 3 following acts:
    • Full or part payment of the purchase price
    • Possesses the property; or
    • Improves the property
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4
Q

What 6 types of K’s are subject to the Statute of Frauds?

A
  1. Marriage;
  2. Contracts that cannot be performed within a year;
  3. Land interests (real estate sales and leases > 1 year);
  4. Executor (contracts for an executor or administrator to answer for the duty of a decedent);
  5. Suretyship for another’s debts; and
  6. Contracts for the sale of goods for a price of $500 or greater
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5
Q

Does mutual promise to marry, without consideration, fall within the SOF?

A

No, only marriage promises made in consideration of marriage (e.g. prenups)

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6
Q

For K’s incapable of being performed within a year, when does the one-year period start?

A

From the date of K execution, not the date performance started

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7
Q

What is a key question to ask when determining whether K falls within the one-year rule?

A

Do the express terms of K make it impossible to be completed in one year?

If yes → SOF applies.

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8
Q

What happens if K is fully or partially performed before one-year is up?

A

Full performance: SOF no longer applies

Part performance: SOF still applies, but restitution available

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9
Q

Is a lifetime employment K subject to the SOF?

A

No, because the employee could die before the end of the year

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10
Q

What is suretyship and the main purpose rule?

A

K that promises to pay the debts of a third party

Main purpose rule: if the surety agreement is for the surety’s own economic benefit, then it does not fall within the SOF

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11
Q

Do indemnity agreements fall within the surety requirement of the SOF?

A

No

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12
Q

What type of land agreements are governed by the SOF?

A

Any agreement transferring or gaining an interest in real property

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13
Q

When does part performance satisfy the SOF for real property contracts?

A

When the buyer completes 2 of the 3 following acts:

  1. Full or part payment of the purchase price;
  2. Possesses the property; or
  3. Improves the property
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14
Q

What type of land agreements are NOT governed by the SOF?

A
  • Licenses for less than or equal to 1 year
  • Mortgage assignments
  • Leases for less than or equal to 1 year
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15
Q

Are easements and leases subject to the SOF?

A

Yes, unless for a length of less than or equal to 1 year

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16
Q

Does the SOF cover the land conveyance itself?

A

No, only the contract for the subsequent conveyance of the land

17
Q

Will K’s tangentially related to land fall within the SOF? (e.g. building a park on a piece of land)

A

No, must be K for an interest in the land itself

18
Q

When goods are worth $500 or more, what is needed to satisfy the SOF under the UCC?

A

A memorandum of the sale that includes:

  1. Indication that K has been made;
  2. Identity of the parties;
  3. Quantity; and
  4. Be signed by the party asserting the SOF defense
19
Q

Under the UCC, when does the SOF not apply to goods over $500?

A
  • Specially manufactured goods;
  • Part payment;
  • Receipt and acceptance; or
  • Failure to respond (if both merchants)
    • If no objection in writing within 10 days after receiving confirmation of the terms of K, K is enforceable without signature
  • Judicial admission
20
Q

When are goods considered specially manufactured?

A
  1. Specially made for the buyer;
  2. Not for sale to others; and
  3. Seller has made “either a substantial beginning of their manufacture or commitments for their procurement

UCC § 2-201(3)(a)

21
Q

Under the UCC, is quantity an essential term to satisfy the SOF?

A

Yes, unless:

  1. There is language providing a basis for measuring quantity; or
  2. K is an output or requirements K
22
Q

What happens if the memorandum of sale contains a mistake as to the price or quantity? (UCC)

A

Agreement is still valid, but likely only enforceable for the quantity listed. Extrinsic evidence can be introduced to show the mistake, however.

23
Q

Under the UCC, when can partial performance satisfy the SOF if K is for divisible goods?

A

Partial performance up to the quantity actually delivered or paid for

24
Q

Under the UCC, when can partial performance satisfy the SOF if K involves indivisible goods?

A

Partial payment renders K fully enforceable