Video instructions and help with filling out and completing What Form 5495 Statutory

Instructions and Help about What Form 5495 Statutory

This unit introduces the statute of frauds it is a common misconception among non lawyers that an agreement needs to be in writing in order to be legally enforceable in fact putting to one side practical questions of proof most oral agreements once proven are every bit is enforceable as a written contract however for several specific kinds of contracts the law requires the agreement to be memorialized in some kind of a writing but not necessarily a formal written contract before it can be enforced the law involved here is not common law case decisions but rather statutory law and although the statutes can differ in their details all states have enacted some kind of statute for the Prevention of frauds which is typically shortened to the phrase statute of frauds section 110 of the Restatement second of contracts summarizes five kinds of contracts that most states general statute of frauds include one contracts by executor zuv S States to perform an obligation of the deceased two contracts to be responsible for the debt of another for example when a parent guarantees repayment of a loan made to a child three contracts made upon consideration of marriage four contracts for the sale or lease of an interest in land at least leases longer than a month and five contracts that cannot be performed within one year from the making of the contract that is it must be impossible and not just unlikely that the contract can be completed within one year this last category is perhaps the trickiest of the five let me give you an example to show why an agreement for lifetime employment is that within the statute no because if the employee died within a year that would complete the lifetime term in the contract and as it is not impossible for anyone to die within the next twelve months it is not impossible to complete the contract within a year but a contract for employment with a 50-year term is within the statute because in that case death does not complete the contract it only terminates it in addition the Uniform Commercial Code includes its own statutes of frauds UCC - - 201 requires that contracts for the sale of goods of $500 or more comply with the statute and UCC 1 - 206 requires that the sale of other kinds of personal property not goods if more than $5,000 is at stake must comply with the statute some examples of other personal property would include intellectual property like patents copyrights or licenses of trademarks if an agreement falls within one of these categories the agreement is said to be within the statute that is it is a kind of contract covered by the statute if an agreement is within the statute then to be enforceable it has to meet one of two requirements either there must be some kind of writing again not necessarily a formal written contract that shows there was a real transaction and that the writing must be signed by the party to be charged that is whichever party is the defendant if there is such a writing the statute is said to be satisfied or there must be an exception that applies to the transaction if there is such an exception it is said to take the transaction out of the statute note the mildly confusing terminology if an agreement is within the statute that means it is one of the kinds of agreements covered by the statute that also means there must be some kind of writing that satisfies the statute conversely if an agreement is outside the statute that means you don't have to worry about any kind of writing lastly if an agreement is within the statute but an exception to the statute applies that exception takes the agreement out of the statute again meaning you don't have to worry about any writing so let's assume we have an agreement that is within the statute now there see some kind of writing that satisfies the statute how do you tell whether a writing satisfies the statute the answer depends on which statute of frauds applies a state general statute or the UCC section 131 of the Restatement second summarizes what most state general statutes require a writing signed by the party to be charged that reasonably identifies the subject matter is sufficient to indicate a contract has been made and states with reasonable certainty the essential terms the UCC statute of frauds 2 - 201 on its face seems similar it requires a writing signed by the party to be charged that is sufficient to indicate a contract for sale has been made most commentators however agree that the UCC statute of frauds is a little more forgiving than the state's general statute of frauds for example the UCC does not require that all essential terms be included in the writing or that the included terms be correct as common one to the section states all that is required is that the writing afford a basis for believing that the offered oral evidence rests on a real transaction