Statute of Frauds

Module IV opens with the first defense to enforcement that is procedural rather than substantive. The Statute of Frauds does not ask whether the parties formed a contract; it asks whether a contract that was formed is enforceable without a signed writing. It serves three functions — evidentiary, cautionary, and channeling — and it cuts both ways: requiring a writing blocks false claims, but it can also let a dishonest party escape a real oral promise.

Which contracts are within the Statute

R2d § 110. Six categories of contract require a signed writing. The MYLEGS mnemonic captures them: Marriage, Year (cannot be performed within one year), Land, Executor (promise to answer for a decedent’s debt out of one’s own funds), Goods of $500 or more (UCC § 2-201), and Suretyship (promise to answer for another’s debt). The one-year rule turns on theoretical impossibility, not likelihood: a promise to paint a house “every summer for five years” is within the Statute, but a promise to do so “for the rest of her life” is not, because she could die within the year.

What writing satisfies the Statute

R2d § 131. A sufficient memorandum need not be the contract itself. It must (1) be signed by the party to be charged, (2) reasonably identify the subject matter, (3) indicate that a contract was made, and (4) state the essential terms with reasonable certainty. An email or electronic signature counts. Extrinsic evidence can resolve an ambiguity in a stated term, but it cannot supply an essential term the writing omits.

UCC § 2-201. For goods of $500 or more, the writing requirement is relaxed: it need only show that a contract was made and state a quantity. The section carries its own exceptions, including the merchant’s confirmatory memo and specially manufactured goods, which the next class takes up.

Cases

McIntosh v. Murphy holds that promissory estoppel can take an oral one-year employment contract out of the Statute where the employee reasonably and foreseeably relied to his substantial detriment (moving to Hawaii) and injustice can be avoided only by enforcement. It shows the equitable escape hatch — and the dissent’s worry that it swallows the rule. Sterling v. Taylor holds that a memorandum need only state the essential terms with reasonable certainty; the writing there failed because it did not identify the specific property and price with enough certainty, and extrinsic evidence could not be used to supply those missing essential terms.

What you should be able to do

Run a transaction through the § 110 / UCC § 2-201 gate and decide whether it is within the Statute. Apply the § 131 content test to a writing fragment and decide whether the essential terms are stated with reasonable certainty. And recognize when reliance under R2d § 139 might defeat the defense entirely. Next class works the exceptions branch in full and pivots into the first substantive defense, mistake.