Introduction
It is known from common law and UCC that even oral contracts can be enforceable if certain conditions apply. The Statute of Frauds, which originated in Great Britain in the 17th century, requires that some agreements must be in written form to be binding (Knapp, Crystal, & Prince, 2019).
Main Objectives
There are six categories of contracts that must be reduced to a written form to be deemed enforceable (Knapp, Crystal, & Prince, 2019). These categories are the sale of an interest in land, purchase of goods that cost 500 dollars or more, suretyship, marriage, services that cannot be performed within one year, and an agreement that estate debts will be paid by estate executor (Knapp, Crystal, & Prince, 2019). If a contract involves one of the mentioned items, it is considered to be within the Statute. Because the categories include items that relate to both the sale of goods and real estate, the Statute of Frauds can be applied both to common law and the UCC.
There is no specific format the writing should be in to be acceptable. However, it is critical that the paper contains the main terms of the contract and information on who the parties are. Also, the parties must sign the contract – if any of the contracting parties does not sign the paper, they will not be held liable (Knapp, Crystal, & Prince, 2019). From the brief summary of Stan’s case, it is not clear whether the paper was explicitly signed by both of the parties. The word “Accepted” indicates that the parties agreed on the terms, but the contract must be signed to be enforceable.
It is clear, however, that the contract involves the sale of both the cabin and the land – the written terms explicitly indicate this fact. Also, there is evidence that the down payment was made, which makes the contract enforceable – offeree induced performance, and the offeror accepted it. In this context, the move-in date is not as relevant as the fact that the land was sold to a third-party. This action of the offeror severely violates the contract’s terms.
Regarding the evidence that can be used in court, the parol evidence rule dictates that, upon reducing the agreement to a final written form, no supplementary oral agreements that were made prior to forming the written contract can be used as evidence (Knapp, Crystal, & Prince, 2019). The written contract in the hands of Stan explicitly indicates that 72000 was the cost of the land, including the cabin. Stan may not be able to use previous emails and oral discussions as evidence. The same applies to Peter – even if there were a verbal agreement that 72000 was only the cost of the cabin, it could not be used as evidence.
Conclusion
There are, however, certain exceptions for the parol evidence rule. If two parties have had contracts before, the court may look at how previous agreements were executed. In Nanakuli Paving & Rock Co. v. Shell Oil Co. (1981), the court ruled that under the UCC, the contracts are broader in scope and also include the evidence from past performance. Extrinsic evidence may also be accepted for the purposes of interpretation, as was done in Taylor v. State Farm Mut. Auto. Ins. Co (1996).
However, if all necessary elements are explicitly stated in the contract, and there are no terms that are implied or should further be explained, no extrinsic evidence is allowed, as was ruled in Thompson v. Libby (1885) and Sherrodd, Inc. v. Morrison-Knudsen Co. (1991).
References
Charles L. Knapp, Nathan M. Crystal, & Harry G. Prince, Problems in Contract Law: Cases and Materials (9th ed. 2019).
Nanakuli Paving & Rock Co. v. Shell Oil Co., 664 F.2d 772 (1981).
Taylor v. State Farm Mut. Auto. Ins. Co., 185 Ariz. 174 (1996).
Thompson v. Libby, 34 Minn. 374, 26 N.W. 1 (1885).
Sherrodd, Inc. v. Morrison-Knudsen Co., 815 P.2d 1135 (1991).