Statute of Frauds
Rule
Certain categories of contracts must be evidenced by a signed writing to be enforceable. The writing need not be the contract itself but must reasonably identify the parties and subject matter, indicate a contract was made or offered, and state essential terms with reasonable certainty.
Elements
Contracts within the Statute (common law):
- Executor/administrator promises to pay estate debts from own funds
- Promise to answer for the debt of another (surety/guaranty)
- Promise made in consideration of marriage
- Contract for the sale of land or interests in land (including mortgages)
- Contract not capable of being performed within one year from date of formation
- Sale of goods of $500 or more (UCC § 2-201)
Writing requirements (Rest. 2d):
- Must be signed by the party to be charged
- Must reasonably identify subject matter and parties
- Must indicate a contract has been made or offered
- Must state essential terms of unperformed promises
- Can consist of multiple writings if they relate to the same transaction and one is signed
Exceptions
Common law mitigating doctrines:
- Full performance: Both parties have fully performed
- Part performance (land only): Acts explainable only by the contract’s existence (part payment + improvement of land)
- Promissory estoppel (Rest. 2d § 139): Reasonable reliance on oral contract; remedy limited as justice requires
UCC § 2-201 specific exceptions:
- Specially manufactured goods not suitable for sale to others + substantial beginning of manufacture
- Written confirmation between merchants, if not objected to within 10 days
- Admission in pleading, testimony, or court proceeding (limited to quantity admitted)
- Part performance: payment received and accepted, or goods received and accepted
Policy
The Statute serves three functions (Fuller): evidentiary (written proof of terms), cautionary (deliberate act before binding obligation), and channeling (distinguishes enforceable from unenforceable promises). Mitigating doctrines (particularly promissory estoppel) allow courts to avoid injustice where the statute’s formal purposes have been substantially served.
Key Cases
- McIntosh v. Murphy — promissory estoppel excuses non-compliance with one-year Statute; reliance on oral employment contract enforced