Statute of Frauds Contracts: Contracts for the Sale of Land

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  • 0:05 Statute of Frauds Requirements
  • 2:02 Statute of Frauds Contracts
  • 3:07 Contracts Involving…
  • 4:25 Exception
  • 5:30 Lesson Summary
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Lesson Transcript
Instructor: Ashley Dugger

Ashley has a JD degree and is an attorney. She has taught and written various law courses.

Some oral contracts aren't enforceable unless the contract is written and signed. These general requirements are part of a statute of frauds. This lesson explores one type of contract that is covered by a statute of frauds: contracts that involve the sale or transfer of land.

Statute of Frauds Requirements

A statute of frauds applies to certain categories of oral contracts. Different states have different statutes of frauds, but all statutes of frauds establish two key requirements. Contracts in these categories are unenforceable, unless they meet the two requirements.

First, there must be a written memorandum of the contract. A memorandum of the contract is a writing that proves the agreement. A written memorandum isn't a formal, written contract. A formal, written contract won't fall under a statute of frauds because the statute only applies to oral contracts.

Instead, the memorandum can be anything that proves that there was an oral contract. The memorandum needs to prove the existence of the contract and set out the material terms of the contract. Material terms vary between contracts, but typically include items such as the parties involved and the amount due.

Second, the memorandum must be signed by the party that disputes the contract. It's usually not necessary for both parties to sign the memorandum. For example, if you seek to enforce an oral contract that you made with me, then I must have signed the memorandum.

For example, let's say that you and I enter an oral contract. I agree to sell a part of my farm to you for $10,000. I draw a map on a napkin, showing you which portion of the farm I'll sell to you. I write $10,000 on the napkin, sign it, and hand it to you. If I later decide not to sell you the portion of my farm, you can use this napkin to enforce our oral contract.

Statute of Frauds Contracts

A statute of frauds only applies to certain types of oral contracts. The states vary, but there are usually six categories covered by a statute of frauds:

  1. Promises that involve marriage as consideration
  2. Contracts that can't be performed within one year
  3. Contracts that involve the sale or transfer of land
  4. Contracts that involve promises by executors to pay estate debts
  5. Contracts that involve a promise to act as a guarantor or surety
  6. Contracts that involve the sale of goods worth more than $500

Businesses often encounter contracts that involve an interest in real property. Let's take a closer look at contracts that involve the sale or transfer of land.

Contracts Involving the Sale of Land

Typically, a statute of frauds will apply to a contract involving the sale or transfer of land or real property. This includes any oral contract that creates or transfers any interest in land. It's important to note how broad this category can be. A statute of frauds applies to any oral contract that conveys land or an interest in land. This means that the statute covers most contracts involving real property, such as those that sell land, grant a mortgage, or provide an easement.

A statute of frauds will also cover some leases. A lease is considered to be a transfer of an interest in land. However, most states don't require leases to be in writing unless the lease is for one year or more.

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