Statute of Frauds

• Author: autor
• Pages: 62-74

62

Chapter 5. Statute of Frauds

5.1. Statute of Frauds – the General Rule. The general rule is that oral contracts are perfectly

good. The exception is the collection of statutes referred to as the Statute of Frauds. These

statutes require certain transactions to be evidenced by a writing. Although you may have an

offer and an acceptance that form a contract for the sale of goods, under UCC § 2-201, the

contract may not be judicially enforceable unless it is evidenced by a writing. The writing

requirement only applies to sales of goods for $500 or more.

5.1.1. Section 2-201(1) sets forth the following requirements for enforcement of a

contract for the sale of goods of $500 or more:

 some writing;

 sufficient to indicate a contract for sale has been made between the parties;

 signed by the party against whom enforcement is sought, or by the party’s

authorized agent; and

 indicating the quantity.

5.1.1.1. Official Comment 1 notes that the writing “need not contain all the material

terms” and any terms stated “need not be precisely stated.” Comment 1 emphasizes

that the only term that must appear is the quantity term, but even that does not need to

be accurately stated. However, recovery is limited to the amount stated, whether

accurate or not.

5.1.2. “Writing” is defined at UCC § 1-201(b)(43) as “printing, typewriting, or any other

intentional reduction to tangible form.” Under Section 7(c) of the Uniform Electronic

Transactions Act, if a law, such as § 2-201, requires a record to be in writing, an

electronic record satisfies the law.

5.1.3. Any terms not supplied by the writing will be supplied by other permissible

evidence and by the gap-filler sections of the UCC.

5.1.4. The statute of frauds does not require the writing to be in one document. Two or

more writings may be pieced together, provided that they relate to the same transaction

(which may be established by the documents themselves, or by other evidence showing

the connection). Thus, one signed payroll card and one unsigned payroll card could be

read together to determine the terms of the agreement. Crabtree v. Elizabeth Arden Corp.,

110 N.E.2d 551 (N.Y. 1953).