Contracts within Statute of Frauds

1
Contracts within Statute of Frauds

• Suretyship Provision
• Executor/Administrator Provision
• Marriage Provision (excp. mutual promises)
• Real Estate Contract
• One-Year Provision
• Sale of Goods for 500 or more
• Modification/Rescission of Contracts within SoF
• Others

2
Suretyship Executor/Administrator Provisions
Exceptions

• Original Promise promise to become primarily
  liable (v. collateral promise)
• Main Purpose Rule object of promise is to
  provide economic benefit to surety
• Promise Made to Debtor promise made by surety
  to debtor (v. 3rd party)

3
Real Estate Exceptions

• Part performance plus reasonable detrimental
  reliance also (sometimes)
• paid a portion or all of purchase price
• buyer has possession or
• Started valuable improvements
• Sellers conveyance of property

4
One-Year Provision Exceptions

• Possibility Test possibility (v. not likely) of
  performance within one year
• Year runs from the time the agreement was made
  (not from the time performance is to begin)
• Look at terms to determine if it is possible for
  performance to occur within one year
• E.g., contracts of indefinite duration
• Full performance by a party

5
Sale of Goods for 500 or More Exceptions

• Admission pleading, testimony, etc.
• Specially manufactured goods upon substantial
  beginning of their manufacture if no notice of
  repudiation and if they cannot be readily resold
  in ordinary course of business
• Delivery or payment and acceptance only for
  those goods which have been accepted or payment
  has been accepted

6
SoF Compliance

• General Contract Law
• Parties
• Subject matter and essential terms
• Signed by party to be charged (or agent)
• UCC Article 2
• Indicate a contract has been made
• Signed by party to be charged (or agent)
• Quantity of goods/securities
• Art 2 Merchants Written Confirmation

7
Merchants Written Confirmation

• UCC Article 2
• Between merchants,
• A written confirmation that is sufficient against
  the sender is also sufficient against the
  recipient unless the recipient gives
• Written notice of his objection within ten days

8
Effect of Noncompliance

• Unenforceable
• However, SoF does not apply to fully performed
  contracts
• Restitution for benefits conferred in reliance
  on oral contract
• Promissory Estoppel enforce where
• Reasonable and justifiable reliance and
• Justice avoided only by enforcement of the oral
  promise

9
Parol Evidence Rule

• Excludes from the contract
• inconsistent
• prior and contemporaneous
• oral and written agreements
• not incorporated into
• an integrated contract

10
Situations to Which the Rule Does Not Apply

• Contract isnt integrated (partly written and
  partly oral intent)
• Typographical error correction
• Evidence of a defense (void or voidable) e.g.,
  lack of capacity, duress, etc.
• Condition precedent has occurred
• Subsequent mutual rescission or modification
• Ambiguous terms

11
Supplemental Evidence

• Course of Dealing previous conduct between the
  parties
• Usage of Trade practice engaged in by the trade
  or industry
• Course of Performance conduct between the
  parties concerning performance of the particular
  contract
• Supplemental Consistent Evidence

12
Rules of Interpretation

• All circumstances are considered and principal
  purpose is given the greatest weight
• A writing is interpreted as a whole
• Wherever possible, intentions of parties are
  interpreted as consistent with each other and
  with course of performance, course of dealing, or
  usage of trade
• Commonly accepted meanings are used unless
  different intention manifested
• Technical terms are given technical meaning
• When words and figures conflict, words control

13
More Rules of Interpretation

• Specific terms get greater weight
• Separately negotiated terms get greater weight
• Where a term has several possible meanings,
  interpret against the party who supplied the
  contract or term
• Order for interpretation is express terms,
  course of performance, course of dealing, and
  usage of trade
• Written provisions are given preference over
  typed or printed provisions typed provisions are
  given preference over printed provisions