The statute of frauds says that certain contracts are unenforceable unless there is a written record signed by the party being sued. It does not make those contracts void. It gives the defendant a defense. The point is to stop people proving important agreements with nothing but their own testimony, and the price is that some real agreements go unenforced.
Rule
- Contracts inside the statute. The usual list is contracts in consideration of marriage, contracts that cannot be performed within one year, contracts for an interest in land, promises by an executor to pay estate debts personally, promises to answer for another's debt, and sales of goods for the price of 500 dollars or more under UCC section 2-201.
- The writing. It must show that a contract was made, identify the parties and the subject matter, state the essential terms, and be signed by the party to be charged.
- More than one document. Several writings can be read together where they clearly refer to the same transaction.
- Exceptions. Part performance in land contracts, full performance of a one-year contract, reliance in some states, and the UCC exceptions for specially manufactured goods, admissions in litigation, and goods accepted or paid for.
Leading cases
- Crabtree v. Elizabeth Arden Sales Corp.: a signed and an unsigned writing could be read together to satisfy the statute where they plainly referred to the same employment agreement.
- Boone v. Coe: an oral contract that could not be performed within a year was unenforceable, and the plaintiffs' preparation expenses did not rescue it.
Where students go wrong
The first mistake is misreading the one-year provision. It asks whether performance was possible within a year of the making of the contract, not whether it was likely or whether it actually took longer. A lifetime employment contract is outside the statute because the employee might die within the year.
The second is thinking the writing has to be a contract. A signed memorandum, a letter, or a chain of documents can satisfy the statute even though nobody meant them to be the agreement.
The third is stopping once the statute applies. Always work through the exceptions, because part performance and reliance take a great many land and services cases back out of it.
FAQ
Does an email or a text message count as a writing?
Generally yes. Electronic records and electronic signatures satisfy the statute in most jurisdictions, and a name typed at the end of a message can be a signature.
What happens if the statute is not satisfied?
The contract is unenforceable against the party who did not sign, but the plaintiff may still recover in restitution for a benefit conferred, and reliance may support a remedy in some states.
Which party has to have signed?
The party being sued. A writing signed by the defendant alone is enough, even if the plaintiff never signed anything.
Related terms
Working through this in your own casebook takes longer than reading it here. Syllume starts from your syllabus and turns each assigned case into a brief you can study from.