2. What contracts must be in writing to be enforceable? What contracts must be in writing to be enforceable? If it is possible for a contract to be performed within one year, must it be in writing? If it is possible for a contract to be performed within one year, must it be in writing? When will an oral promise to pay another person’s debt be enforced? When will an oral promise to pay another person’s debt be enforced? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2

3. If a written contract is required, what terms are considered essential and must be contained in the written document? If a written contract is required, what terms are considered essential and must be contained in the written document? What is parol evidence? When is it admissible to clarify the terms of a written contract? What is parol evidence? When is it admissible to clarify the terms of a written contract? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3

4. To be enforceable, the following types of contracts must be in writing and signed: To be enforceable, the following types of contracts must be in writing and signed: – Contracts involving Interest in Land.  – Contracts involving “One-Year Rule.”  – Collateral or Secondary Contracts.  © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4

5. The following types of contracts must be in writing and signed (cont’d): The following types of contracts must be in writing and signed (cont’d): – Promise Made in Consideration of Marriage.  – Contracts for the Sale of Goods priced at $500 or more.  © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5

6. Contracts Involving Interests in Land. Contracts Involving Interests in Land. – All contracts for the transfer of any interest in land: mortgages and leases. Salim v. Solaiman – CASE 14.1 Salim v. Solaiman (2010). Do you agree that lack of an adequate property description can make the contract unenforceable? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6

7. The One Year Rule. The One Year Rule. – A contract that cannot, by its own terms, be performed within one year from the date it was formed. – One-year period begins to run the day after the contract is made. Test: Whether performance is possible (although unlikely) within one year. – © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7

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9. Collateral Promises. Collateral Promises. – Primary v. Secondary Obligations. Primary obligation does not need to be in writing. Secondary obligation must be in writing to be enforceable. – Exception--“Main Purpose Rule”. Oral contract is enforceable if main purpose is benefit to guarantor. © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9

10. Promises Made in Consideration of Marriage. Promises Made in Consideration of Marriage. – Unilateral promise to make monetary payment or gift in consideration of a promise to marry must be in writing. – Same applies to prenuptial agreements. © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10

11. Contracts for the Sale of Goods. Contracts for the Sale of Goods. – UCC requires a writing or memorandum for the sale of goods priced at $500 or more. © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11

12. Exceptions to the Statute of Frauds. Exceptions to the Statute of Frauds. – Partial Performance: court will grant specific performance if partially performed. – Admissions. – Promissory Estoppel. – Special Exceptions under the UCC (oral contracts between merchants Ch. 18). © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12

13. © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13

14. Statute of Frauds requires a ‘Written Memorandum’ (written or electronic) signed by the party against whom enforcement is sought. Statute of Frauds requires a ‘Written Memorandum’ (written or electronic) signed by the party against whom enforcement is sought. What Constitutes a Writing? What Constitutes a Writing? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14

15. What Must Be Contained in the Writing? What Must Be Contained in the Writing? – The essential terms: quantity, signed by party to be charged, names of parties, subject matter, consideration. Sales of land must state the price and description with sufficient clarity. – Faxed memo sufficient if it shows a meeting of the minds. © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15

16. Oral representations or promises made prior to the contract’s formation or at the time the contract was created, may not be admitted in court. Oral representations or promises made prior to the contract’s formation or at the time the contract was created, may not be admitted in court. Exceptions.  Exceptions.  © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16

17. Exceptions: Exceptions: – Contracts subsequently modified. – Voidable or Void contracts. – Contracts containing ambiguous terms. – Incomplete Contracts. – Prior dealing, course of performance, or usage of trade.  © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17

18. Exceptions (cont’d): Exceptions (cont’d): – Contracts subject to orally agreed-on conditions precedent. – Contracts with an obvious or gross clerical error. Watkins v. Schexnider – CASE 14.2 Watkins v. Schexnider (2010). If you were the judge, would you have admitted the evidence? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18

19. What is an “Integrated Contract”? What is an “Integrated Contract”? © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19