George Mason School of Law
Contracts I
Statute of Frauds
F.H. Buckley
fbuckley@gmu.edu
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Next day
 Restatement §§ 1-4, 9, 17-24
 Scott 201-05, 4-23
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Balance of term
 Offer and Acceptance
 Consideration
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The Statute of Frauds
Sometimes the law is like Pericles, sometimes like a plumber
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The Statute of Frauds: Why 1677?
Party
on,
dudes!
5
Why 1677?
 Juries as fact-finders
 Interested parties not admissible as
witnesses
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Why 1677?
 Juries as fact-finders
 Interested parties not admissible as
witnesses
 If that made the Statute of Frauds
necessary then, why do we need it
now?
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What is the sanction for noncompliance?
 Restatement § 110(1): not
enforceable absent a note or
memorandum in writing
 UCC § 2-201
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The problem: A trap for the
unwary?
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The Statute of Frauds
What’s its Purpose? McIntosh
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The Statute of Frauds
What’s its Purpose? McIntosh
 Evidentiary
 Antifraud
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The Statute of Frauds
What’s its Purpose? McIntosh
 Evidentiary
 Antifraud
 Cautionary
 Reflects seriousness of contracting
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The Statute of Frauds
What’s its Purpose? McIntosh
 Evidentiary
 Antifraud
 Cautionary
 Reflects seriousness of contracting
 Channeling
 Distinguishing enforceable contracts
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The Statute of Frauds
What’s its Purpose? McIntosh
 Evidentiary
 Antifraud
 Cautionary
 Reflects seriousness of contracting
 Channeling
 Distinguishing enforceable contracts
 [Economizing on court costs?]
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So when would we want to
require a writing?
 What do the categories of
Restatement § 110 tell us?
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The Statute of Frauds
What’s its Purpose? McIntosh
 Major Contracts
 Possibility of a ill-considered promise
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The Statute of Frauds
 Marriage Settlements
 The old action for breach of promise
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The Statute of Frauds
 Marriage Settlements
 Restatement §§ 110(1)(c), 124
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The Statute of Frauds
 Marriage Settlements
 Restatement §§ 110(1)(c), 124
 A promises to settle Blackacre upon B when
she marries A: Illustration 1
 How is this different from breach of promise?
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The Statute of Frauds
 Marriage Settlements
 Restatement §§ 110(1)(c), 124
 A promises to settle Blackacre upon B when
she marries A: Illustration 1
 How is this different from breach of promise?
 Cf. the proviso to §124
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The Statute of Frauds
 Marriage Settlements
 Restatement §§ 110(1)(c), 124
 A promises to settle Blackacre upon B when
she marries A: Illustration 1
 What does the reference to “consideration”
exclude?
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The Statute of Frauds
 Marriage Settlements
 Restatement §§ 110(1)(c), 124
 A promises to settle Blackacre upon B when
she marries A: Illustration 1
 What does the reference to “consideration”
exclude?
 Cf. illustration 5
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The Statute of Frauds
 Marriage Settlements
 Suppose the parties do get married. Is
that sufficient reliance under
Restatement § 124?
 Cf. comment d
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 Restatement § 110(1)(e)
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 What is the rationale for the rule?
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 What is the rationale for the rule?
 An aide-memoire?
 Or a significant contract?
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 What is the rationale for the rule?
 An aide-memoire?
 Or a significant contract?
 Do you agree with Farnsworth?
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 Land
 110(1)(d)
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“Tis the only thing worth
fighting for, worth dying for”
The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 Land
 Executor’s Assumption of Liability
 Restatement § 110(1)(a)
 No new consideration needed
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The Statute of Frauds
 Marriage
 Promises not to be performed within
One Year
 Land
 Executor’s Assumption of Liability
 Goods worth more than [$500]
 Restatement § 110(2)(a) → UCC § 2-201
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Restatement § 110 ff, UCC § 2-201
 Marriage
 Promises not to be performed within
One Year
 Land
 Executor’s Assumption of Liability
 Goods worth more than [$500]
 Suretyship Agreements
 Restatement § 112
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Suretyship
Obligee
Principal (obligor)
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Suretyship
Obligee (promisee)
Surety for Principal
(promisor)
Principal (obligor)
Assumes a prior obligation by obligor to obligee
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MY LEGS
 Marriage
 Promises not to be performed within
One Year
 Land
 Executor’s Assumption of Liability
 Goods worth more than [$500]
 Suretyship Agreements
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 What does the Π have to assert to win in
McIntosh?
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 What does the Π have to assert to win in
McIntosh?
 Not terminable at will, but for a fixed term
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 What does the Π have to assert to win in
McIntosh?
 Not terminable at will, but for a fixed term
 What that term might be
 Gee, let’s say one year
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 What does the Π have to assert to win in
McIntosh?
 Not terminable at will, but for a fixed term
 What that term might be
 But then Δ asserts the promise is not
unenforceable by virtue of the Statute of
Frauds
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 It’s November 1, 2011. I ask you to work
for me from January 10, 2012 until January
10, 2013
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 It’s November 1, 2011. I ask you to work
for me from January 10, 2012 until January
10, 2013
 Restatement § 130
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 It’s November 1, 2011. I ask you to work
for me beginning on January 10, 2012, with
the expectation that the work MIGHT be
completed by January 10, 2013
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 It’s November 1, 2011. I ask you to work
for me beginning on January 10, 2012, with
the expectation that the work MIGHT be
completed by January 10, 2013
 Restatement § 130: cannot be performed
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How does the one-year rule work?
 “Not to be performed within one year
from the making thereof”
 I insure your house against fire for five
years without a writing. Three years have
elapsed.
 Restatement § 130, illustration 1.
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McIntosh
 What is estoppel? And promissory
estoppel?
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McIntosh
 Restatement § 139
 Promisor should expect reliance
 Promisee does rely
 Non-enforcement would be unjust
 Cf. Restatement § 90 re consideration
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Was McIntosh a proper case for estoppel?
What do you think would have
happened if McIntosh had asked
for a written contract?
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Are salesmen given tenure?
Ron Popeil and the Veg-o-matic
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Was McIntosh a proper case for estoppel?
If you’re Murphy, how do you
react to the decision?
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Was McIntosh a proper case for estoppel?
Should estoppel mimic the bargain
the parties would likely have struck?
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Is land different?
 What do real estate agents make you
do if you want to buy a house?
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Is land different?
 What do real estate agents make you
do if you want to buy a house?
 Written offers throughout
 Closing
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Is land different?
 Restatement § 125
 Contracts to buy or sell land, not
leaseholds
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What happened in Schwedes?
Swan River MT
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What happened in Schwedes?
 Sale by seller--No real estate agent
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What happened in Schwedes?
 Sale by seller--No real estate agent
 What, if anything, constituted promisee
reliance?
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What happened in Schwedes?
 Sale by seller--No real estate agent
 What, if anything, constituted promisee
reliance?
 Securing financing?
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What happened in Schwedes?
 Sale by seller--No real estate agent
 What, if anything, constituted promisee
reliance?
 Securing financing?
 The offer to send the purchase price?
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What happened in Schwedes?
 Sale by seller--No real estate agent
 What, if anything, constituted promisee
reliance?
 Securing financing?
 The offer to send the purchase price?
 Psychic reliance?
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Psychic Reliance Costs
But when the cheque bounces tomorrow…
Happy,
Happy,
Joy, Joy
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Estoppel
 Why was a defense of promissory
estoppel explicitly rejected in Schwedes?
 Restatement § 139
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Part Performance
 Cf. Restatement § 129
 Buyer gives seller purchase price. Can
buyer have specific performance?
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Can you distinguish Schwedes from McIntosh?
 But cf. Restatement § 129
 Buyer gives seller purchase price. Can
buyer have specific performance?
 Cf. Illustration 1
 Contrast Illustration 3
 Restatement § 139(2)(a)
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Lawyer’s Ethical Duties
 Should Hoover have disclosed that
the sellers were dickering with
another purchaser?
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Lawyer’s Ethical Duties
 Should Hoover have disclosed that
the sellers were dickering with
another purchaser?
 MRPR § 1.6
A lawyer shall not reveal
information relating to the representation of a client
unless the client gives informed consent…
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Lawyer’s Ethical Duties
 What about saying that sending the
payment was unnecessary?
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Lawyer’s Ethical Duties
 What about saying that sending the
payment was unnecessary?
 MRPR § 4.3
The lawyer shall not give legal
advice to an unrepresented person, other than the
advice to secure counsel, if the lawyer knows or
reasonably should know that the interests of such a
person are or have a reasonable possibility of being in
conflict with the interests of the client.
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The “note or memorandum in writing”
 Restatement §§ 110, 131
 Signed by or on behalf of the party to be
charged
 Specifies subject matter
 Evidences existence of a contract
 Essential terms
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The “note or memorandum in writing”
 Restatement §§ 110, 131
 What is a signature?
 Cf. Illustration 2
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The “note or memorandum in writing”
 Restatement §§ 110, 131
 What is a signature?
 Cf. Illustration 2
 Cf. Restatement § 134, illustrations 1 and 3
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The “note or memorandum in writing”
 Compare UCC § 2-201(1)
 Evidences existence of a contract
 Signed by or on behalf of the party to be
charged
 But not above quantity of goods shown
in the writing
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Monetti
Melform products
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Monetti
 How was this within the SoF?
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Monetti
 How was this within the SoF?
 One year
 Sale of Goods?
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Monetti
 How was this within the SoF?
 One year
 Sale of Goods?
 Why might it matter which it is?
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Monetti
 In what sense is this not like a sale of
goods?
 Cf. UCC 2-105(1)
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Monetti
 In what sense is this not like a sale of
goods?
 Cf. UCC 2-105(1)
 Sale of goods or distributorship agreement?
 Which one fits better (predominant purpose)?
 Both statutes?
 A mixed contract (pick and choose)?
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Monetti
 Who is the party to be charged?
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Monetti
 How was the first writing “signed” by
Anchor?
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Monetti
 How was the first writing “signed” by
Anchor?
 Typed initials “SS” on Steve Schneider’s
draft “Topics for Discussion”
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Monetti
 How was the first writing “signed” in
Monetti?
 Typed initials “SS”
 UCC § 1-201(37) Signed “includes any symbol executed
or adopted by a party with present intention to adopt or
accept a writing.”
 Restatement § 134, illustration 3
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Monetti
 How was the first writing “signed” by
Anchor?
 Typed initials “SS”
 Did it matter that this was a precontractual draft?
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Monetti
 How was the first writing “signed” in
Monetti?
 Typed initials “SS”
 Did it matter that this was a precontractual draft?
 Restatement § 136
 Posner’s three cases on 529: how to tell
them apart?
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Monetti
 How was the first writing “signed” in
Monetti?
 Posner’s three cases on 529
 UCC 2-201: “a contract for sale has been
made:
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Monetti
 What about the internal “summary
agreement” by Raymond Davis?
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Monetti
 What about the internal memo?
 Δ’s letterhead suffices
 How did Π obtain this?
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The “note or memorandum in writing”
 What about the internal memo?
 Δ’s letterhead suffices
 How did Π obtain this?
 Is Restatement § 132 applicable?
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The “note or memorandum in writing”
 What about the internal memo?
 Δ’s letterhead suffices
 How did Π obtain this?
 Is Restatement § 132 applicable?
 Posner: they don’t refer to each other
(530)
 Posner: “we are permitted to connect
them” (532)
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Monetti
 What was the part performance?
 Restatement §§ 139(2)(b), 145
 UCC § 2-201(3)(c)
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George Mason School of Law
Contracts I
Unconscionability
F.H. Buckley
fbuckley@gmu.edu
89