Chapter 16

Question 1

Statute of frauds

Answer 1

A state statute under which certain types of contracts must be in writing to be enforceable
- denies enforceability to certain contracts that do not comply with its writing requirements

Question 2

Contracts that require writing

Answer 2

1. Contracts involving interests in land
2. Contracts that cannot by their terms be performed within one year the day after it was formed
3. Collateral, secondary contracts such as promisee to answer for the debt or duty of another and promisee by the administrator or executor or an estate to pay a debt personally
4. Promises made in consideration of marriage
5. Contracts for the sale of goods prices at $500 or more (under UCC)

Question 3

The one year rule

Answer 3

Contracts by their own terms cannot be performed within one year from the day after the contract is formed.
- bc the parties memory of their contracts terms are not reliable for longer than a year

Question 4

Collateral promise

Answer 4

A secondary promise that is subsidiary to a principal transaction or primary contractual relationship such as a promise made by one person to pay the debts of another if the latter fails to perform
Exception: main purpose rule

Question 5

Main purpose rule

Answer 5

If the guarantors main purpose in incurring a secondary obligation is to secure a personal benefit then it is not covered by the statute of frauds

Question 6

Prenuptial agreements

Answer 6

An agreement made before marriage that defines each partners ownership rights in the other partners property
- must be in writing to be enforceable

Question 7

Exceptions to the writing requirement

Answer 7

Partial performance
Admissions (admitting under oath)
Promissory estoppel

Question 8

Parol evidence rule

Answer 8

A court will not receive evidence into the parties prior negotiations, prior agreements, or contemporaneous oral agreements if that evidence contradicts or varies the terms of the parties written contract.

Question 9

Exceptions to the parol evidence rule

Answer 9

1. Contracts subsequently modified
2. Voidable or void contracts
3. Incomplete contracts
4. Prior dealing, course of performance or usage of trade
5. Contracts subject to an orally agreed-on condition precedent
6. Contracts with an obvious or gross clerical error that would clearly not represent the agreement of the parties

Question 10

Integrated contract

Answer 10

A written contract that constitutes the final expression of the parties agreement. If a contract is integrated, evidence extraneous to the contract that contradicts or alters the meaning of the contract in anyway is inadmissible