Which of the following is an exception to the statute of frauds and does not have to be in writing?

Q: What is an exception to the Statute of Frauds quizlet?

The Main Purpose Exception. Exception to the Statute of Frauds that states that if the main purpose of a transaction and an oral collateral contract is to provide pecuniary benefit to the guarantor, the collateral contract does not have to be in writing to be enforced.

The Statute of Frauds is a legal principle that requires certain types of contracts to be executed in writing to be enforceable. The Statute of Frauds aims to prevent fraud by formalising agreements, especially significant ones that carry serious consequences.

Inhaltsverzeichnis Show

Electronic contracts
Exceptions to the Statute of Frauds
Effect of non-compliance with the Statute of Frauds
Pavey & Matthews Pty Ltd v Paul (1987) 69 ALR 577
How Gibbs Wright Litigation Lawyers can help
What is the Statute of Frauds?
Types of Contracts Governed
Exceptions to the Statute of Frauds
What are exceptions to the Statute of Frauds?
Which of the following is an exception to the Statute of Frauds and does not have to be in writing quizlet?
What is an exception to the Statute of Frauds quizlet?
Which of the following is not an exception to the Statute of Frauds requirement that contracts involving the sale of goods for $500 or more be in writing?

For instance, it applies to contracts for the sale of land, as dictated by section 59 of the Property Law Act 1974 (Qld):

“No action may be brought upon any contract for the sale or other disposition of land or any interest in land unless the contract upon which such action is brought, or some memorandum or note of the contract, is in writing, and signed by the party to be charged, or by some person by the party lawfully authorised.”.

The Statute has both evidentiary and cautionary purposes — requiring contracts to be in writing provides evidence if a dispute arises, and encourages parties to carefully consider their obligations under the contract before entering into it.

Estimated reading time: 4 minutes

Electronic contracts

A document in electronic form, such as one sent via email or over the internet, will be taken to be in writing (and signed) if certain requirements are met.

Section 14 of the Electronic Transactions (Queensland) Act 2001 (Qld) states that a signature requirement will have been met if:

a method is used to identify the person and to indicate their intention in relation to the information provided;
the method was either as reliable as appropriate in the circumstances, or was proven to have fulfilled the functions above; and
the recipient consents to receiving the signature that way.

Section 11 of that Act states that a requirement to give information in writing will have been met by giving the information by electronic communication if:

at the time the information was given, it was reasonable to expect the information would be readily accessible so as to be useable for subsequent reference; and
the recipient consents to the information being given by electronic communication.

Exceptions to the Statute of Frauds

There are a number of exceptions to the Statute when only an oral agreement exists, even though the Statute would usually require the agreement to be in writing to be enforceable.

An example is when a party relies on an oral agreement and partially performs their obligations. The courts will usually rule that the oral agreement is enforceable, up to the extent that the contract has been completed.

This doctrine of “part performance” overcomes injustice for that party by allowing equitable relief.

Another example is an implied easement on land. This is an easement not created by grant or reservation or statute but implied by common law so that the land can continue to be used in a certain way.

Effect of non-compliance with the Statute of Frauds

A failure to comply with the Statute of Frauds makes a contract unenforceable rather than void. So, it is possible for parties to choose to proceed with the contract.

Pavey & Matthews Pty Ltd v Paul (1987) 69 ALR 577

Licensed builder, Pavey & Matthews, made an oral contract with Paul to do certain building work on a cottage. Paul made a part payment for the work and refused to pay the balance. When Pavey & Matthews demanded it, Paul claimed that the contract was unenforceable because it was not in writing as was required by section 45 of the Builders Licensing Act 1971 (NSW).

The High Court ruled that Pavey & Matthews was entitled to restitution because Paul had accepted the work that had been done and Paul would otherwise be unjustly enriched at Pavey & Matthews’ expense. Their Honours Mason and Wilson JJ considered that the purpose of the provision was to “protect the building owner against spurious claims by a builder by preventing the enforcement by him of nonconforming contracts”. They continued, however, that “it would be going a very long way indeed to assert that the statutory protection extends to a case where the building owner requests and accepts the building work and declines to pay for it on the ground that the contract fails to comply with the statutory requirements”, concluding that an “interpretation that serves the statutory purpose yet avoids a harsh and unjust operation is to be preferred”.

How Gibbs Wright Litigation Lawyers can help

If you have concerns over the validity of a contract or any other contract matters, you can discuss them with our contract lawyers during a no-obligation, confidential consultation today.

A principle of law that requires some contracts to be in writing in order to be enforceable

What is the Statute of Frauds?

The statute of frauds is a foundational principle of common law that requires – for them to be enforceable – some types of contracts to be written rather than merely oral agreements. It is a longstanding and well-established legal principle, originating in 17th century English law.

The original legislative act passed by the English Parliament in 1677 – titled An Act for Prevention of Frauds and Perjuries – may still be effective law in some Canadian provinces. In England and the United States, while the statute of frauds has been a guiding legal principle in common law for centuries, many of its elements have since been codified through specific legislation in most jurisdictions.

The statute of frauds exists primarily to serve two main purposes – evidentiary and cautionary. Requiring written contracts provides evidence in the case where a future dispute arises. Requiring parties to create written contractual agreements also, hopefully, induces the parties to only enter into such an agreement after due consideration and to avoid seriously obligating themselves without such appropriate consideration.

Oral contracts are usually just as enforceable as written contracts, but the statute of frauds requires that certain types of contracts must be put into writing and signed by the appropriate parties.

Summary

The statute of frauds is a principle of law that requires some contracts to be in writing in order to be enforceable.
The statute does not necessarily require a formal document to be drafted, as long as there is some written record that clearly specifies the parties to the agreement and the subject and terms of the agreement.
Despite the written agreement requirements by the statute of frauds, there are some instances where a court will rule an oral agreement as enforceable even though the statute of frauds requires a written agreement.

Types of Contracts Governed

The statute of frauds governs six specific types of contracts. Contracts that fall outside the statute need not be in writing to be enforceable. However, if only an oral contract exists where the statute requires a written contract, that oral contract will be considered legally voidable. The following are the six types of contracts that the statute of frauds requires to be in writing:

Contracts whose obligations cannot be completed within one year’s time from the date of the contract. There is, however, an exception to this rule – contracts whose duration is indefinite are not subject to the statute of frauds.
Contracts for the sale or other transfer of any interest in land – this may apply to anything from the granting of an easement to the outright purchase of a property.
Contracts or promises where the consideration for the contract is marriage. This includes things such as prenuptial agreements or the giving of an engagement ring.
Any contract for the sale of goods whose price or value is equal to or greater than $500.
Contracts of suretyship – these are contracts where one party agrees to act as a guarantor on behalf of another party concerning a debt or other obligation.
Contracts or promises by the executor of a will or an estate to pay a debt owed by the estate out of the executor’s own money if the estate does not contain sufficient funds to cover the obligation.

Where the statute of frauds necessitates a written contract, it does not typically require the contract to be a formal document. Any type of written agreement that is reasonably clear and signed by the appropriate parties will usually suffice, as long as it meets the following conditions:

The written document must contain the essential terms of the contract, such as the price to be paid for goods received.
The parties to the contract must be clearly identified in the contract.
It must also be signed – preferably by both parties to the contract but, at minimum, by the party against whom the enforcement of the contract is being sought.

Exceptions to the Statute of Frauds

There are several legal exceptions to the statute of frauds, where only an oral agreement is found to exist, even though the statute would ordinarily require a written agreement to be enforceable.

One exception is where the party seeking to enforce a contract can show that they have acted in reliance on an oral agreement and that at least partial performance of the contractual obligations has been completed. In such instances, the courts will usually rule that the oral agreement is enforceable, at least to the extent that the contract has been completed.

For example, if one party orally agrees to manufacture 1,000 t-shirts for another party for a specified price, and has manufactured and delivered 500 of the shirts, then a court will order the other party to pay for the 500 shirts already received. However, since the oral agreement violates the statute of frauds, the court may rule that the balance of the contract is unenforceable.

Another exception to the written requirement of the statute is in the area of real estate and known as an “easement by implication.” Suppose, for example, that Property Owner B can only access his property by driving over part of the driveway that is on Property Owner A’s land.

If Property Owner B can show that it is the only reasonable way to access his property and that there has been pre-existing, ongoing usage of Owner A’s driveway for access for some time, then a court will hold that an easement by implication exists and that no written contract for the easement is necessary.

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What are exceptions to the Statute of Frauds?

These exceptions are admission, performance, and promissory estoppel. Admission means that an oral contract can be enforced without meeting the requirements of a statute of frauds if the other party admits under oath that the oral contract was made. Performance can mean full performance or partial performance.