Statement of Rule

The Statute of Frauds requires that there be a written memorandum of the contract in certain cases.  The following contracts require a memorandum in most states:

• land contracts;
• sale of goods, if the price is $500 or more;
• contracts that cannot be performed within one year;
• suretyship contracts;
• promises by executors and administrators;
• contracts in consideration of marriage.

The memorandum which is required must be in writing, signed by the party to be charged, and it must contain the essential elements of the deal. 

The memorandum need not be formal: receipts, telegrams, exchange of correspondence, etc., can serve as memoranda. 

The essential elements may be in more than one writing, but if so, one of the writings must contain something referring to the others. 

The memorandum need not be delivered.  If it is lost or destroyed, it still operates to satisfy the Statute of Frauds, and its prior existence can be proved by oral evidence.

Contract Cannot Be Performed Within One Year

In determining if a contract can be performed within one year, measure from the time of the making of the contract to the time prescribed for the end of performance, not just the time when performance will take place.

A personal services contract for more than a year is within the statute of frauds despite the fact that the contract would be prematurely terminated if the personal service supplier died within the year.

A contract for life is not within the statute of frauds because death could occur within a year, which would be the natural termination of the contract.

Suretyship

An oral promise to pay the debt of another is usually unenforceable because of the statute of frauds.  However, if a person agrees to pay the debt of another for the primary purpose of furthering his own goals, rather than those of the debtor, the statute of frauds will not prevent enforcement of the promise.

Sale of Goods

Contracts for the sale of goods for $500 or more must satisfy the statute of frauds, unless they are specially manufactured goods and not suitable for sale to others in the ordinary course of business.

The statute of frauds is satisfied to the extent that there is part performance.

The statute of frauds with respect to the sale of goods does not apply where the goods have been received and accepted.

The statute of frauds with respect to the sale of goods is satisfied in a contract between merchants where one merchant sends a written, signed memorandum of the transaction sufficient to bind him to the contract and the receiving merchant does not object within ten days.

In a UCC contract, a memorandum satisfies the statute of frauds if it indicates there is a contract, it contains a description of the goods and the quantity, and is signed.  It need not contain the price.

A modification of a UCC contract, if it involves a sale of goods for more than $500, requires compliance with the statute of frauds.

Land Contracts

In a contract for the sale of land, the memorandum required to satisfy the statute of frauds must contain the price.

A real estate brokerage contract is not within the statute of frauds.