chapter 15

AGREEMENTS THAT CANNOT BE COMPLETED IN LESS THAN ONE YEAR

- a contract that can not be completed within one year must be in writing If the life of the contract is indefinite and there is a possibility of its being completed within a year, it need not be in writing.

Antenuptial or Prenuptial Agreement:

- an exchange of promises made by persons planning to marry It is enforceable only if it is reduced to writing before the marriage takes place. This law applies to agreements by the parties to accept additional obligations not ordinarily included in the marriage contract. It should be noted that antenuptial nuptial agreements often include a provision whereby they expire after a long period of time. Antenuptial agreements relating to custody of children in the event of divorce or separation are unenforceable; courts decide custody issues.

parol evidence rule: oral v. written

1. Although the PER applies to writings created at the same time as the written agreement, these writings tend to be treated differently than prior or contemporaneous oral agreements. 2.The writings are more readily admitted as part of the written agreement than is oral evidence regarding conditions or terms in the final agreement. 3.As long as contemporaneous written documents do not substantially contradict what is in the final writing, judges can use their discretion to deem these other writings part of that agreement. Consequently, the PER does not usually exclude extrinsic written evidence!

contents of a contract or agreement

To satisfy the Statute of Frauds, a written contract or agreement (memorandum) must contain: 1. the names of the parties 2. the purpose of the agreement 3. A description of the consideration promised. 4. The date and place where the contract was made. 5. the signatures of the parties

real property or real estate

land and items permanently attached to the land, such as buildings or trees -• All contracts to sell real property or any interest in it must be in writing to be enforceable . An exception to the written requirement occurs when there has been partial performance of an oral agreement, thus proving the existence of a contract. Example: A buyer pays all, or a portion of, the purchase price.

a guaranty

or promise, to pay the debts or settle the wrongdoings of another if he or she does not make settlement personally is not enforceable unless it is written. Example: Joe, the president of Landscape Products, Inc., orally promised to pay the corporation's debts from his own resources in an effort to calm several persistent creditors. Under the Statute of Frauds, Joe's promise is not enforceable because it is not in writing.

an oral promise

to pay the debts of another is enforceable in some states, however, if the promise is not dependent on the inability or unwillingness of the other party to pay them.

when contracts should be in writing

• The element of proper form requires that certain contracts must be in writing to be enforceable. However, not all contracts should be in writing because many of them are routine that writing a contract would be a waste of time and effort. Examples of nonwritten contracts: Taking a bus ride, purchasing groceries, or ordering a meal in a restaurant. • Some contracts should be in writing to protect against later disagreement. Example: Contract for the purchase of a television. Some must be writing because the law requires it for the contract to be enforceable.

information included in a written contract

Most important contracts are printed and signed by hand by the parties to the agreement. A signature may include any symbol used by a contracting party intending to authenticate a written agreement. This can include a firm's logo or a purchase order. A valid agreement can be entirely handwritten as long as it is legible. It may even be a series of letters or e-mail among several persons.

AGREEMENTS TO SELL PERSONAL PROPERTY FOR $ 500 OR MORE

-• Today's UCC states that sales of personal property of 500 or more must be in writing. Several states have increased this amount in recent years. Example: A store owner and a display manufacturer have a long-standing relationship. The store owner requests a display stand be built, but does not have a written contract. Either of them can cancel, since the contract was not in writing and was legally unenforceable.

The Statute of Frauds specifies six types of contracts that must be in writing to be legally enforceable

1. Agreements by an executor or administrator to pay the debts of a deceased person. 2. Agreements to answer for the debts of another. 3. Agreements that cannot be completed in less than one year. 4. Agreements made in contemplation of marriage. 5.Agreements to sell any interest in real property. 6. Agreements to sell personal property for $500 or more.

Exceptions to Statute of Frauds

1. Partial Performance 2. admissions 3. Promissory Estoppel

Requirements of a Valid Contract

1. offer & acceptance with mutual agreement 2. consideration 3. competent parties 4. legality of purpose

In addition written contracts frequently contain the following information:

1. warranties provided by the seller 2. an agreement to be bound by the laws of the specific state 3. An acknowledgment that the buyer has inspected the goods, or has waived his or her right to such inspection. 4. The form of acceptable payment (cash, certified check, etc.).

parol evidence rule exceptions

A common exception occurs when oral evidence serves to clear up an ambiguous part of an agreement. (Case 15.3 - Frewil, LLC v. Price) Thus, oral evidence introduced after a contract is signed is legally accepted if it clarifies some point in the written agreement. A few examples of exceptions to the parol evidence rule are: incomplete contracts, contracts that contain typographical errors, and voidable contracts. In these cases, a court may rule that oral evidence is admissible.

administrator

A personal representative named by the court to perform as the executor would in instances in which the deceased person has not left a will. Either an executor or an administrator has legal authority to arrange for the distribution of the assets of a deceased person, and pay debts of the deceased. The statute of frauds requires that such a promise must be in writing to be enforceable.

executor

A personal representative named in a will to handle matters involving the estate of the deceased person. The statute of frauds requires that such a promise must be in writing to be enforceable.

AGREEMENTS TO SELL PERSONAL PROPERTY FOR $ 500 OR MORE: exceptions

Exceptions to this requirement: Partial or full payment to the seller renders the contract enforceable because it shows the serious intent of the buyer, just as much as a written agreement does. auction sales:Goods are sold to the highest bidder, and the sale is completed at the fall of the hammer. auction bids made by telephone: The bidder is required to sign an agreement in which he or she agrees to be bound by the telephone bids made. online sale: The Web page or e-mail is generally regarded as the writing that satisfies the Statute of Frauds.

parol evidence rule

Parol evidence: Any supplementary evidence or conditions, written or oral, that a party wants to add to a written contract. The word parol in parol evidence rule means "speech" or "words." The rule: Any spoken or written words that are in conflict with what the written contract states cannot be introduced as evidence in a court of law. Purpose of the rule: Lends stability, predictability and integrity to written contracts

statute of frauds

The Statute of Frauds specifies that certain kinds of agreements must be in writing to be enforceable. While there is some variation in its interpretation, most states agree on the main principle of the statute. It is important to note that the Statute of Frauds does not prohibit a person from legally entering into oral contracts for certain kinds of agreements; it only specifies that certain contracts must be in writing to be enforceable. The Statute of Frauds applies to executory contracts only; however, once a contract has been completed, it cannot be canceled merely because it was not in writing.