Bus Law Chapter 18: Contracts in Writing Part 1

What are the four specific types of contracts within the scope of the statute of frauds and thus required to be evidenced by a writing?

1. Contracts whose terms prevent possible performance within one year. 2. Promises made in consideration of marriage. 3. Contracts for one party to pay the debt of another if the initial party fails to pay. 4. Contracts related to an interest in land.

What agreements during marriage need to be in writing according to the statute of frauds?

Agreements regarding marriage in which one party is gaining something OTHER than a return on his or her promise to marry are within the statute of frauds and MUST be in writing.

What is the special fifth category of contracts required to be in writing?

Although required to be in writing under the UCC and not the statute of frauds, a related fifth category is contracts for the sale of goods totaling more than $500.

Where does the idea for written contracts come from?

The idea of written contracts comes from an English law. The English law is called the Act for the Prevision of Frauds and Perjuries. This is a law that passed by Parliament in 1677.

What is an added secondary benefit of the moment of writing?

The moment of writing also allows both parties to reconsider their terms and ensure that they are advocating what they desire in the contract.

How is the "statute of frauds" a misleading name?

The name "statute of frauds" does not relate to fraudulent contracts. Rather, it addresses the enforce ability of contracts that fail to meet the requirements set forth in it.

When does the one year period begin for contracts whose terms prevent possible performance within one year?

The one year period begins the day after the contract is created, not when it is scheduled to begin.

How does the statute of frauds protect promisors of oral contracts?

The statute serves to protect promisors from poorly considered oral contracts by requiring that certain contracts be in writing. Before entering into a contract one needs to know whether its subject matter requires a writing.

Does the test for compliance with the one-year rule consider the likelihood of completing the contract within one year?

The test for compliance with the one-year rule does not consider the likelihood of completing the contract within one year. Rather, it considers the possibility of completing the contract within one year.

Is there a law called the "statue of frauds"

There is no federal legislation entitled the "Statute of Frauds".

If Ed and Jeanie are getting married and Ed promises Jeanie he will buy her a new car every year if she will marry him, how will this contract be enforced?

To be enforceable, Ed and Jeanie's agreement must be in writing because Jeanie stands to benefit, by way of new cars, if she marries Ed.

What does the Act for the Prevision of Frauds and Perjuries do to correct a problem in the common law?

To correct a problem in the common law, the act requires that specific types of contracts be in writing and be signed by both parties to ensure enforce-ability.

If one party promises another party something as part of an offer of marriage, can the contract be oral?

When one party promises something to the other as part of an offer of marriage, the contract must be in writing to be enforceable.

Why are written contracts better than oral contracts?

Written contracts provide certain advantages oral contracts lack.

Do prenuptial agreements fall within the statute of frauds?

Yes, prenuptial agreements fall within the statute of fraud.

What is the legal principle for marriage contracts?

Contracts in which one party promises something in exchange for another's promise to marry must have a writing to be enforceable, but mutual promises to marry do not require a writing.

How can disputes about the specific terms in an oral contract be settled?

Disputes about the specifics of the terms in an oral contract are easier to settle when the terms are solidified in writing.

Does a contract have to be written if it can be performed within a year?

If a contract can possible be performed within a year, even if such performance is highly unlikely, then the contract does not need a writing to be enforceable.

In general what do written contracts do?

In general, written contracts smooth the conduct of business transactions. Some contracts thus require writing.

How are the modern English systems different from the American systems when it comes to the statutes of frauds?

Interestingly enough, the English have repealed almost all their requirements for writing, while U.S. states and courts are still expanding the requirements for what falls within the statute of frauds.

Roberto enters into a contract with Elise. He is going to work for her for one year starting October 1st. If the contract is created on the preceding September 15th, can it be completed in one year from September 16th?

It cannot be completed in one year from September 16th, so it must be in writing. However, if the contract is scheduled to start immediately, it can be completed in one year and does not need to be in writing, because it is not in the statute of frauds.

What states do not use the statue of frauds or a version of it?

Louisiana has no statute of fraud legislation. New Mexico and Maryland follow statutes of frauds created by judicial decisions and not the legislature.

What is the first purpose of the statute of frauds?

1. The statute of frauds attempts to ease contractual negotiations by requiring sufficiently reliable evidence to prove the existence and specific terms of a contract. When a contract is deemed important enough that being in writing is required under the statute of frauds, the statute specifies what is considered reliable evidence.

What is the second purpose of the statute of frauds?

2. The statute of frauds serves the purpose of preventing unreliable oral evidence from interfering with a contractual relationship. By requiring that a contract be in writing, the statute precludes the admittance of oral evidence denying the existence of a contract or claiming additional terms that would substantially alter the contract from its agreed-on written form.

What is the third purpose of the statute of frauds?

3. The statute of frauds prevents parties from entering into contracts in which they do not agree. The statute of frauds provides some degree of cautionary protection for the parties, who must carefully consider the terms, agree to them, write them out, and finally sign the contract. The law assumes that these steps will allow time for careful consideration. Thus, the statute of frauds works to prevent hasty, improperly considered contracts.

What is a prenuptial agreement?

A prenuptial agreement is an agreement two parties enter into before marriage that clearly states the ownership rights each party enjoys in the other party's property.

What is consideration in regards to prenuptial agreements?

Consideration in prenuptial agreements is evidence that both parties understand and agree to all the terms of the agreement and that the agreement is not biased in favor of one party.

Do contracts for complex construction projects need to be in writing?

Contracts for complex construction projects do not need to be in writing because, theoretically, they can be completed within one year if a sufficiently large crew works around the clock every day, even if the scenario is highly unlikely.

Do mutual promises to get married fall within the statute of frauds?

No, because both party is not gaining anything other than a return on their promise to get married, the agreement does not fall within the statute.

Does a contract for lifetime employment need to be in writing? Why?

No, it does not need to be in writing, because it is possible for the contract to be completed within one year.

Is consideration legally required in prenuptial agreements?

No, it's not legally required, but courts tend to privilege prenuptial agreements that include it.

Can contracts whose performance, based on the terms of the contract, could not possibly occur within one year be oral?

No, they fall within the statute of frauds and therefore must be written.

Where does the "Statute of Frauds" exist?

The "Statute of Frauds" exists as legislation at the state level. Every state has made its own version of the act.