The Statute of FraudsThe Statute of FraudsSection 10.1Section 10.1
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1Section 10.1The Statute of Frauds The Statute of Frauds
Section 10.2Section 10.2Special Rules and Formalities Special Rules and Formalities
1010ChapterChapter Form of a ContractForm of a Contract
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
What You’ll Learn
How to explain the purpose of the How to explain the purpose of the Statute of Frauds (p. 206)Statute of Frauds (p. 206)
How to explain the legal status of a How to explain the legal status of a contract that is not in writing (p. 206)contract that is not in writing (p. 206)
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
What You’ll Learn
How to identify the elements that must be How to identify the elements that must be included in a written contract (p. 206)included in a written contract (p. 206)
How to deal with contradictory and How to deal with contradictory and ambiguous terms in a written agreement ambiguous terms in a written agreement (p. 207)(p. 207)
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
What You’ll Learn
How to identify which contracts must be in How to identify which contracts must be in writing (p. 208) writing (p. 208)
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Why It’s Important
Understanding which contracts must be in Understanding which contracts must be in writing, as well as the elements of a writing, writing, as well as the elements of a writing, will help you avoid pitfalls associated with will help you avoid pitfalls associated with the Statute of Frauds.the Statute of Frauds.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Legal Terms
breach of contract (p. 206)breach of contract (p. 206)perjury (p. 206)perjury (p. 206)Statute of Frauds (p. 206)Statute of Frauds (p. 206)memorandum (p. 206)memorandum (p. 206)goods (p. 213)goods (p. 213)real property (p. 213)real property (p. 213)
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing
Elements of a Writing Evaluating Contradictory TermsEvaluating Ambiguous Clauses
Section OutlineSection Outline
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts That Must Be in WritingContracts to Pay Debts of OthersContracts to Pay Debts of Deceased
PersonsContracts Requiring More Than a Year
to Perform
Section OutlineSection Outline
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts That Must Be in Writing, continued
Contracts in Consideration of MarriageContracts for Sale of Goods of $500 or
MoreContracts to Sell Real Property
Section OutlineSection Outline
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Pre-Learning Question Pre-Learning Question
Why do you think some contracts should be in writing?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
In early England, contracts did not In early England, contracts did not have to be written to be fully have to be written to be fully enforceable. Persons could be enforceable. Persons could be brought to trial for breach of written or brought to trial for breach of written or oral contracts.oral contracts.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
A A breach of contractbreach of contract is a wrongful is a wrongful failure to perform one or more failure to perform one or more promises of a contract. promises of a contract.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
Only persons who were not parties to Only persons who were not parties to the contract could be witnesses in the contract could be witnesses in court. To protect their friends or self-court. To protect their friends or self-interests, witnesses often made false interests, witnesses often made false statements under oath in court.statements under oath in court.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
Making such false statements is called Making such false statements is called perjuryperjury and is a crime. and is a crime.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
To discourage such practices, To discourage such practices, Parliament passed the “Act for the Parliament passed the “Act for the Prevention of Frauds and Perjuries,” Prevention of Frauds and Perjuries,” which became known as the Statute which became known as the Statute of Frauds. It required certain contracts of Frauds. It required certain contracts to be in writing to be enforceable.to be in writing to be enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Purpose of a Writing Purpose of a Writing
Most states now have a Most states now have a Statute of Statute of FraudsFrauds, which are state laws requiring , which are state laws requiring that certain contracts be evidenced by that certain contracts be evidenced by a writing.a writing.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
What is a breach of contract?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
ANSWERANSWER
A wrongful failure to perform one or more promises of a contract.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Pre-Learning Question Pre-Learning Question
What elements should be present in a written contract?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Elements of a Writing Elements of a Writing
A A memorandum memorandum is the written is the written evidence of an agreement, need not evidence of an agreement, need not be formal, and could be: be formal, and could be:
a letter a letter a sales slip a sales slip an invoicean invoice
a telegrama telegramwords written on a words written on a checkcheck
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Elements of a Writing Elements of a Writing
Elements of a writing should identify Elements of a writing should identify the following: the following:
PlacePlaceDateDateParties involvedParties involvedSubject matterSubject matter
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Elements of a Writing Elements of a Writing
Price and termsPrice and termsIntent of the partiesIntent of the partiesSignature of the party who may be Signature of the party who may be chargedcharged
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Evaluating Contradictory Terms Evaluating Contradictory Terms
If changes are made to a contract, the If changes are made to a contract, the court will uphold the most recent court will uphold the most recent terms.terms.
If handwritten changes are made to If handwritten changes are made to a typewritten or printed contract, the a typewritten or printed contract, the handwritten terms will prevail. handwritten terms will prevail.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Evaluating Contradictory Terms Evaluating Contradictory Terms
Typewriting prevails over printing.Typewriting prevails over printing.A dollar amount written in words will A dollar amount written in words will prevail over the amount written in prevail over the amount written in figures. figures.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
10.110.1
Contradictory Terms Contradictory Terms
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Evaluating Ambiguous Clauses Evaluating Ambiguous Clauses
When a written contract can be When a written contract can be understood in different ways, the court understood in different ways, the court will lean in favor of the party who did will lean in favor of the party who did not draft the contract and against the not draft the contract and against the one who drafted it. one who drafted it.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Pre-Learning Question Pre-Learning Question
What type of contracts do you think should be in writing?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts That Must Be in Writing Contracts That Must Be in Writing
Every state has a law requiring that Every state has a law requiring that certain kinds of contracts be in writing certain kinds of contracts be in writing to be enforceable. to be enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts to Pay Debts of Others Contracts to Pay Debts of Others
A contract that one person makes with A contract that one person makes with another to pay the debts of someone another to pay the debts of someone else must be in writing to be else must be in writing to be enforceable.enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts to Pay Debts of Contracts to Pay Debts of Deceased Persons Deceased Persons
An executor uses property from the An executor uses property from the estate to pay off any debts.estate to pay off any debts.
If the estate lacks the money to pay If the estate lacks the money to pay the debt, the executor may promise to the debt, the executor may promise to pay them with his or her own money.pay them with his or her own money.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts to Pay Debts of Contracts to Pay Debts of Deceased Persons Deceased Persons
Such an agreement, which is actually Such an agreement, which is actually an agreement to pay another’s debts, an agreement to pay another’s debts, must be in writing to be enforceable.must be in writing to be enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts Requiring More Than Contracts Requiring More Than a Year to Perform a Year to Perform
All contracts must be written if they All contracts must be written if they cannot be performed within one year cannot be performed within one year of the date they are made. The year of the date they are made. The year legally begins when the contract is legally begins when the contract is made, not when performance is to made, not when performance is to start.start.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts in Consideration Contracts in Consideration of Marriage of Marriage
When two persons agree to marry, a When two persons agree to marry, a written contract is not required. written contract is not required.
The promises they make to one The promises they make to one another serve as the consideration for another serve as the consideration for the contract.the contract.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts in Consideration Contracts in Consideration of Marriage of Marriage
However, if one person agrees to However, if one person agrees to marry another person in return for a marry another person in return for a third person’s promise of money or third person’s promise of money or property, then the agreement must be property, then the agreement must be in writing. in writing.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts for Sale of Goods Contracts for Sale of Goods of $500 or Moreof $500 or More
A contract for the sale of goods for A contract for the sale of goods for the price of $500 or more must be in the price of $500 or more must be in writing to be enforceable.writing to be enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts for Sale of Goods Contracts for Sale of Goods of $500 or Moreof $500 or More
Goods Goods consist of movable items, consist of movable items, including specially manufactured including specially manufactured items. Furniture, books, livestock, items. Furniture, books, livestock, cultivated crops, clothing, automobiles, cultivated crops, clothing, automobiles, and personal effects of any kind are and personal effects of any kind are considered goods.considered goods.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
For contracts requiring more than a year to perform, when does the year legally begin?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
ANSWERANSWER
When the contract is made.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Contracts to Sell Real PropertyContracts to Sell Real Property
Contracts for the sale of Contracts for the sale of real real propertyproperty, which is land and anything , which is land and anything permanently attached to it, must be in permanently attached to it, must be in writing to be enforceable.writing to be enforceable.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
1. What is the purpose of the Statute of Frauds?
Section 10.1 Assessment
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
To prevent fraud and perjury
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
2. What is the legal status of a contract that is not is writing?
Section 10.1 Assessment
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
A contract that is supposed to be in writing, but which is not, is unenforceable.
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
3. What are the elements that must be included in a written contract?
Section 10.1 Assessment
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
Place, date, parties, subject matter, price and terms, and intent of the parties.
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
4. How are contradictory and ambiguous terms in a written agreement interpreted by a court?
Section 10.1 Assessment
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
With contradictory terms, the court will uphold the most recent terms. The court will interpret ambiguous clauses against the person who wrote the contract.
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
5. What contracts must be in writing?
Section 10.1 Assessment
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
Contracts to pay the debts of others and to pay the debts of deceased persons, contracts requiring more than a year to perform, and contracts in consideration of marriage.
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Reviewing What You Learned
Contracts to sell real property and contracts for the sale of goods of $500 or more.
Section 10.1 Assessment
Answer
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1 Assessment
Critical Thinking ActivityStatue of Frauds Does a writing have to be a formal document to satisfy the requirements of the Statute of Frauds?
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1 Assessment
Critical Thinking Activity AnswerStatue of Frauds No. A writing does not have to be a formal document to satisfy the requirements of the Statutes of Frauds.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1 Assessment
Legal Skills in ActionHistory of the Law Clark and Fiona believe that the Statute of Frauds was originally intended as a criminal provision designed to catch con artists who prey on innocent, unsuspecting victims.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1 Assessment
Legal Skills in ActionHistory of the Law Write a report in which you explain the actual historical context in which the Statute of Frauds was first enacted in England.
Understanding Business and Personal Law
The Statute of Frauds The Statute of Frauds Section 10.1Section 10.1
Form of a Contract
Section 10.1 Assessment
Legal Skills in Action AnswerHistory of the Law Reports will vary. The original purpose of the Statute of Frauds was to discourage the practice of fraudulent statements in court by witnesses when an oral contract has not been fulfilled.
The Statute of FraudsThe Statute of FraudsEnd of Section 10.1End of Section 10.1