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CHAPTER 11
WRITTEN CONTRACTS
Answers to Learning Objectives
(Page 111)
1. The Statute of Frauds requires contracts (a) for the sale of land, (b) that cannot be performed
within one year, (c) to pay the debt of another, (d) of an administrator to personally pay the
debts of the estate, and (e) in consideration of marriage, to be in writing.
2. When a written contract is required, it must set forth all the material terms of the transaction
and be signed by the party to be charged.
3. The parol evidence rule prohibits oral testimony from being introduced to change or add to
the terms of a complete, written contract.
Lesson Outline
1. It is often difficult, if not impossible, to prove the contents of oral contracts.
2. The Statute of Frauds, passed in England in 1677, listed classes of contracts which had to be
in writing. Most states have adopted with but slight variations the sections containing the lists
of such contracts.
3. The Statute of Frauds requires the following agreements to be in writing:
a. Agreements to sell land or any interest in land, or to lease land for more than one year
b. Agreements in which the terms cannot be performed within one year from the time the
contract is made
c. Agreements to become responsible for the debt or default of another. If such a promise is
really made to gain some advantage for the promisor, it need not be in writing.
d. Agreements of executors or administrators to pay the debts of the estate from personal
funds
e. Agreements containing a promise of one person in consideration of marriage
4. The contract itself does not need to be in writing if a note or memorandum setting forth all
the terms of the contract is signed by the party against whom the claim for breach of promise
is made.
5. Most states have some contracts other than those listed in the Statute of Frauds that must be
in writing. The most common ones are contracts for the sale of securities, agreements to pay
a commission to real estate brokers, and a new promise to extend the statute of limitations.
6. The parol evidence rule does not permit any testimony to be introduced to vary, add to,
modify, or contradict the terms of a written contract unless there is evidence of fraud,
accident, or mistake so that the writing is in fact not a contract or is incomplete or
ambiguous.
Comments on Cases
(p. 113) The court held that when Miller filed the Declaration he had the right to receive title to
the second parcel upon payment of the purchase price so he did have an interest in the
second parcel. In addition, the lot owners had only the rights of their predecessor in title
(Miller) and since the oral contract was fully performed, the Statute of Frauds could no
longer be raised. Cash v. Granite Springs Retreat Ass’n, Inc., 248 P.3d 614 (Wyo.)
37
Chapter 11 Written Contracts
(p. 114) The court pointed out that if the promises in an oral agreement may possibly be
performed within a year the Statute of Frauds did not apply. Here the time frame ran
from less than a year so it could have been performed within that time. Henry v.
Blankenship, 621 S.E.2d 601 (Ga. Ct. App.)
(p. 114) The court pointed out that Rucsitto could have had additional, valid business reasons for
making the promise. He could have wanted to protect A&L’s business reputation and
probably did not want to adversely affect the commonwealth’s future willingness to
award A&L contract. Trumbull Corp. v. Boss Const., Inc., 801 A.2d 1289 (Pa. Commw.
Ct.)
(p. 115) The trial court had dismissed Chaim’s cause of action for failure to comply with the
Statute of Frauds. The appellate court reinstated the action since the oral promise had
been made to Chaim, the debtor, not to the third party bank. Steinberger v Steinberger,
676 N.Y.S.2d 210 (N.Y. App. Div.)
(p. 116) An agreement to return an engagement ring if the marriage does not take place is clearly
an agreement made in contemplation of marriage and covered by the Statute of Frauds.
Curtis v. Anderson, 106 S.W.3d 251 (Tex. Ct. App.)
(p. 116) The court pointed out that the evidence was that the Moormans and Blackstock never
agreed on all the essential elements of a contract. The fact that no contract was ever
signed when they kept negotiating terms for a contract showed that there had been no
agreement. Moorman v. Blackstock, 661 S.E.2d 404 (Va.)
(p. 117) The court pointed out that the requirement of acquiring the Davidson lot did not vary or
alter the terms of the written agreement since it did not change the property to be
conveyed; did not alter the parties involved; and did not alter the consideration. Brown
Development Corp. v. Hemond, 956 A.2d 104 (Me.)
Answers to Questions
(Page 118)
1. Provided it includes all the terms and provisions of the agreement, a written contract has the
advantages over an oral contract that its existence cannot be denied and that its terms can be
ascertained.
2. Courts will allow enforcement of an oral contract required by the Statute of Frauds to be in
writing if one party has made part performance and would be hurt if the contract was not
enforced.
3. (Answers will vary) Examples of contracts not involving the sale of land, but only an
interest in the land that the Statute of Frauds requires to be in writing involve rights of way,
joint use of driveways, mineral rights, timber or a lease of real property for more than one
year.
4. A contract that cannot be performed in one year must be in writing to be enforceable since it
might easily be forgotten before the contract is completed. To minimize the need to resort to
the courts because the parties do not remember the terms of the contract such contracts must
be written.
5. The Statute of Frauds requirement of a writing when a person agrees to be responsible for the
debt of another is unnecessary when the main purpose of the promise is to gain some
advantage for the promisor.
38
6. When a party sues to enforce an alleged contract, the Statute of Frauds requires that the
agreement of the parties be evidenced either by a writing signed by both parties, or that there
is a note or memorandum in writing signed by the party against whom the claim for breach of
contract is made.
7. The note or memorandum required by the Statute of frauds must include all the essential
terms of the contract.
8. The note or memorandum required by the Statute of Frauds must have been made by the time
suit is brought.
9. The parol evidence rule will allow another writing made before or at the time of executing a
contract to modify a written contract that appears to be complete when the contract refers to
other writings and indicates they are considered as incorporated into the contract.
10. If a written contract is not complete courts will admit oral evidence to clear up ambiguity or
to show the existence of trade customs that are to be regarded as forming part of the contract.
1. Yes. Even though Myaer did not sign the subsequent contract, by continuing his
employment he accepted Nodak’s unilateral offer which changed the commission terms.
Since the later contract provided for no bonuses, but only reductions and was complete,
Myaer’s affidavit could not alter the terms of the contract. Myaer v. Nodak Mut. Ins.Co., 812
N.W.2d 345 (N.D.)
2. Enforcement of the PSA’s was not barred by the Statute of Frauds. The court said since the
exhibits were specifically incorporated into the PSA’s, they were a part of the contract or
written memorandum. The fact that they were on different pieces of paper did not matter,
and the identification of the leases in Exhibit A contained a sufficient legal description.
Preston Exploration Co., L.P. v. GSF, L.L.C., 669 F.3d 518 (5th Cir.)
3. No. The court said the enforceability of a contract under the one year provision of the Statute
of Frauds did not depend on whether the contract was actually completed within one year. It
only covers contracts that cannot possibly be completed within one year. Since Mackay
could have retired in the first year after the contract was made, the Statute of Frauds did not
require the contract to be in writing. Mackay v. Four Rivers Packing Co., 173 P.3d 1064
(Idaho)
4. No. The court found that the written release was complete and unambiguous. The MOU and
the subsequent oral agreement fell under the clear language of the release that covered “any
and all” claims in connection with “the organization, development and operation” of WVSC.
Daines v. Vincent, 190 P.3d 1269 (Utah)
5. No. Since Mary’s promise was an oral agreement to pay Glenn’s debt it is not enforceable
under the Statute of Frauds. Since Mary received no benefit from the loans she was not
liable under the exception to the Statute of Frauds. Page v. Gulf Coast Motors, 903 So.2d
148 (Ala. Civ.App.)
6. Yes. The court found that the signed addendum of June 16 was necessary to satisfy the
Statute of Frauds, but it was not the actual contract between the parties. It was simply
evidence of their oral agreement and Shahparast’s admission of the agreement’s existence.
The court said the Statute did not require the writing be made at the same time as the oral
agreement. As here, such a writing could even be made after breach of the oral agreement.
Wang got to keep the property with the new house on it. Royal Investment Group LLC v.
Wang, 961 A.2d 665 (Md. Ct. Spec. App.)
7. Yes, the oral testimony should be admitted. Even though Fowler and the District had a
written contract it was ambiguous because it was not clear whether the “floodwater retarding
39
Chapter 11 Written Contracts
structure” was just the dam or also the lake. Since the written contract was ambiguous, oral
testimony could be admitted to explain the contract. Fowler v. Lincoln County Conservation
Dist., 15 P.3d 502 (Okla.)
8. No. Newell and Carol made full performance of their part of the agreement. The Statute of
Frauds allows enforcement of otherwise unenforceable agreements when there has been such
performance. Simons v. Simons, 11 P.3d 20 (Idaho)
40
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