Chapter 13
The Statute of Frauds—
Writing Requirement
N.B.: TYPE indicates that a question is new, modified, or unchanged, as follows.
N A question new to this edition of the Test Bank.
+ A question modified from the previous edition of the Test Bank,
= A question included in the previous edition of the Test Bank.
TRUE/FALSE QUESTIONS
1. Under the Statute of Frauds, oral contracts are void.
2. The Statute of Frauds is a compilation of all the laws and regulations related to
fraud.
3. The primary purpose of the Statute of Frauds is to ensure that all parties to a
contract understand all the terms of the contract.
4. Every state has a statute that stipulates what types of contracts must be in
writing.
5. The writing requirement under the Statute of Frauds means that an agreement
must be a formal written contract.
6. A contract must be in writing to be enforceable if it makes performance
possible only over a period of more than one year.
7. A contract must be in writing to be enforceable if the contract makes per–
formance possible within any definite period of time.
8. An oral contract for a transfer of land is always enforceable.
9. Under the Statute of Frauds, an oral contract for the transfer of a mortgage is
enforceable.
10. Under the Statute of Frauds, fixtures, such as buildings, growing crops and
minerals, are treated as real property.
11. A contract involving property of any kind must be in writing to be enforceable.
12. A contract for lifetime employment cannot not be performed within one year
and so it must be in writing to be enforceable.
CHAPTER 13: THE STATUTE OF FRAUDS—WRITING REQUIREMENT 3
13. An agreement that includes an option to purchase real property must be in
writing for the option to be enforced.
14. Any collateral promise falls outside the Statute of Frauds and does not need to
be in writing to be enforceable.
15. A contract in which a party assumes a secondary obligation must be in writing
to be enforceable.
16. A collateral promise is one made by a third party to assume the debts or
obligation of a primary party to a contract if the primary party does not perform.
17. A primary obligation is created when a party agrees to pay for something on
the condition that a certain other party does not make the payment.
18. A party’s oral agreement to pay another’s debt is NOT enforceable if the party’s
main purpose is to derive a benefit for himself or herself.
19. A prenuptial agreement must be in writing to be enforceable.
20. Prenuptial agreements are agreements made during a wedding ceremony that
define each partner’s duties to one another during the marriage.
21. A contract for a sale of goods priced at $501 must be in writing to be
enforceable.
22. Courts may grant specific performance of an oral contract to transfer an
interest in land that has been partially performed.
23. There are no exceptions to the writing requirement of the Statute of Frauds.
24. To be enforceable, a memorandum evidencing an oral contract that would
otherwise be unenforceable must include the essential terms.
25. An oral contract for a sale of goods for more than $5,000 is not enforceable
even if the parties to it admit to its existence in court.
26. In some states, an otherwise unenforceable oral contract may be enforced
under the doctrine of promissory estoppel.
27. An oral contract may be enforceable if the person making the promise could
foresee that the promisee would rely on the promise.
CHAPTER 13: THE STATUTE OF FRAUDS—WRITING REQUIREMENT 5
28. An oral contract may be enforceable if enforcing the promise is the only way to
avoid injustice.
29. To be enforceable as a contract, a writing must have been signed by the party
who seeks to enforce it.
30. Evidence of prior agreements that differ from the written terms of a contract can
be introduced in court to alter the contract.
31. Parol evidence includes testimony about communications between the parties
that are not contained in the contract itself.
32. Oral evidence to “fill in the gaps” of a contract with incomplete terms can be
introduced at a trial.
33. Oral evidence of otherwise clear terms in a contract can be introduced at a trial
to contradict those terms.
34. Oral evidence of the modification of a contract after its making can be
introduced at a trial.
35. An integrated contract is a contract with more than one subject or part.
MULTIPLE CHOICE QUESTIONS
1. Selena buys a cell phone for $350 and an air hockey table for $1,500, and
signs a one-year employment contract for a $4,000 monthly salary to start at
the beginning of the next month. The Statute of Frauds covers
a. the employment contract, and the game table and phone purchases.
b. the employment contract and the game table purchase only.
c. the employment contract only.
d. the game table and phone purchases only.
2. Ted and Svetlana orally agree to several different oral contracts. The Statute of
Frauds will bar enforcement of an oral contract for
a. a deal that will be performed within a year.
b. a primary obligation.
c. a sale of goods for $100.
d. a sale of land.
3. Jayne and Wilbur enter into an oral contract on May 1 under which Jayne
agrees to deliver a collection of exotic wines by April 30 of the following year.
This contract is enforceable by
a. Jayne only.
b. Wilbur only.
c. either party.
d. neither party.
4. Fiona and Dora enter into an oral contract under which Fiona agrees to work
on Dora’s farm for not less than one week. This contract is enforceable by
a. Fiona only.
b. Dora only.
c. either party.
d. neither party.
5. Big Dog Security Service, Inc. orally agrees to provide security services for
NorthGate Mall for as long as NorthGate Mall requires them. This contract is
enforceable by
a. Big Dog Security only.
b. NorthGate Mall only.
c. either party.
d. neither party.
6. Marta buys a candy bar for $5 and signs a contract for delivery of fresh flowers
to her mother’s nursing home every week for the rest of her mother’s life. She
then enters into a contract to assume George’s debt to FastCars Dealership.
Marta receives no personal benefit from assuming George’s debt. The Statute
of Frauds covers
a. the candy purchase only.
b. the candy purchase and the delivery contract only.
c. the contract to assume George’s debt only.
d. the contract to assume George’s debt and the delivery contract only.
7. Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees
to pay Kyle’s debt if he does not. Ilsa does not get any personal benefit from
the agreement. This contract is enforceable by
a. any party.
b. Jiffy only.
c. Jiffy or Kyle.
d. none of the parties.
8. Julie orally agrees to assume Carlyle’s debt to FunGames, Inc. Julie gets a
substantial personal benefit from the agreement—Carlyle agrees to work for
Julie’s landscaping service for six months. Julie’s oral assumption of the debt is
enforceable by
a. Julie or Carlyle only.
b. FunGames only.
c. any of the parties.
d. no one.
9. Wild Rides Theme Park owes both RollercoasterRepair, Inc. and Hot Dog
Harry money. RollercoasterRepair orally agrees to assume Wild Rides’s debt to
Hot Dog Harry to prevent Hot Dog Harry from filing suit against Wild Rides.
This contract is enforceable by
a. none of these parties.
b. any of these parties.
c. Wild Rides only.
d. RollercoasterRepair only.
10. Sharon agrees to assume a debt owed by Tom’s Guitars Inc. to United Funds
Bank. The agreement is not in writing. To be enforceable under the “main
purpose” rule, the promise must be for the benefit of
a. any party.
b. Sharon.
c. Tom’s Guitars.
d. United Funds.
11. Eleanora offers Flossy the amount of an investment in Flossy’s start-up
business venture if she marries Eleanora’s son Glenn. This promise is
enforceable
a. only if it is in writing.
b. only if the amount of the investment is more than $500.
10 UNIT TWO: CONTRACTS
c. only if Glenn agrees to marry Flossy.
d. under no circumstances.
12. Quest Holdings, Inc., orally contracts for a lease of its facilities to Ray to use for
his Swamp & Bayou Fishing Camp. Ray pays part of the rent, takes
possession, and improves the property for use by his enterprise. The contract
is most likely enforceable by
a. Quest Holdings and Ray.
b. Quest Holdings but not Ray.
c. any interested third party, such as a Swamp & Bayou client.
d. no one.
13. On Monday, Merlin buys a tablet for $500 from a Pads & Pods store. On
Tuesday, he returns to the store and buys a GPS device for $200. On
Wednesday, he downloads $100 worth of tunes from singsong.com. To be
enforceable, the contract must be in writing for the purchase of
a. the tunes, the GPS device, and the tablet.
b. the GPS device and the tablet only.
c. the tablet only.
d. the tunes only.
14. Francine buys a new business-law textbook for $125 and a used car for
$6,000. She also signs a one-year lease for an apartment for $700 monthly
rent to start at the beginning of the next month. The Statute of Frauds covers
a. the apartment lease, and the textbook and car purchases.
b. the apartment lease and the car purchase only.
c. the apartment lease only.
d. the textbook and car purchases only.
15. Dick’s Burgers n’ Shakes enters into an oral contract with Restaurant
Equipment Warehouse (REW) for REW’s sale to Dick’s of a single-spindle
milkshake mixer for $300. Assuming the terms can be proved, the contract is
enforceable by
a. the seller or the buyer.
b. the manufacturer of the mixer.
c. any third party with an interest in the deal, such as one of Dick’s
customers.
d. none of the choices.
16. Dixie May enters into a contract to buy one hundred pounds of pecans from
Margaret. The contract must be in writing if the pecans cost
a. $100.
b. $150.
c. $250.
d. $500.
17. Recycled Sales Company and Standard Purchasing Corporation enter into a
contract for a sale of goods. To be enforceable, the contract should be in
writing if the goods are valued at more than
a. $5.
b. $15.
c. $50.
d. $500.
18. Atlantic Applications, Inc., and Pacific Resale Company (PRC) enter into an
oral contract for Atlantic’s sale to PRC of six used forklifts for $1,900 each.
Before PRC takes possession of the items, this contract is enforceable by
a. either party.
b. neither party.
c. Atlantic only.
d. PRC only.
19. Valley Tack Shop signs a contract with Gary’s Boots and Saddles for delivery
of five saddles that cost $200 each. To be enforceable under the Statute of
Frauds, the written contract must designate
a. the method of delivery.
b. the method of payment.
c. the quantity of saddles.
d. the seller.
20. Veggie Grocers orders by phone twenty cartons of canned beets from Organic
Food Packers, Inc. After ten cartons are delivered and accepted, Veggie
repudiates the contract. Organic can enforce the contract to
a. any extent because the order was placed orally.
b. no extent because the order was placed orally.
c. the extent of the ten accepted cartons.
d. the extent of the twenty ordered cartons.
21. Miranda orally promises Nicky that she will buy his fishing trawler for $20,000.
If Nicky acts in reliance on this promise, under the doctrine of promissory
estoppel, the transaction is enforceable by
a. either party.
b. Miranda only.
c. neither party.
d. Nicky only.
22. Daisy files a suit against Elton to enforce an oral contract that would otherwise
be unenforceable under the Statute of Frauds. The court could enforce such a
contract if
a. Daisy foreseeably and justifiably relied on Elton’s promise to her
detriment.
b. Elton denies the existence of any contract.
c. neither party has begun to perform.
d. the deal does not involve customized goods.
23. Commercial Decor, Inc., files a suit against Discount Mart Corporation, asking
the court to enforce an oral contract between the parties under the doctrine of
promissory estoppel. This doctrine applies in
a. all states.
b. no states.
c. one state.
d. some states.
24. Benito orally promises Carolina that he will buy her modified 1968 Dodge
Charger. For this promise to be enforceable under the doctrine of promissory
estoppel,
a. the Charger must be considered a customized good.
b. Carolina must act in reliance on Benito’s promise to her detriment.
c. Benito’s promise must have been overheard by a third party.
d. there must be written evidence of the deal.
25. Lucas orally agrees to sell his Mountain Spring Beverage Company to Natural
Soft Drinks, Inc. Lucas notes the terms on a sheet of Mountain Spring
stationery and signs it. This agreement is most likely enforceable against
a. no one.
b. Lucas and Natural Soft Drinks.
c. Lucas.
d. Natural Soft Drinks.
26. Grain Farms, LLC, and Harvest–to-Market Truck & Transport Company sign a
written contract that does not involve a sale of goods. To be enforceable, the
writing must include
a. a correct title, such as “Shipment Contract.”
b. all essential and nonessential terms.
c. a statement of the consideration.
d. a description of the parties’ businesses.
27. Hal’s True Hardware Stores and Ideal Tools, Inc., sign a written contract for a
sale of goods. To be enforceable, this written contract must include
a. a correct title, such as “Purchase Order” or “Sales Invoice.”
b. a date, such as “October 2014” or “10/2014.”
c. a quantity term, such as “50 hammers” or “100 boxes of assorted nails.”
d. the parties’ contact information.
28. Ranchland Properties and Prairie State Investments sign a written contract for
a sale of land. In some states, to be enforceable, this contract must include
a. a correct title, such as “Land Transfer” or “Real Estate Agreement.”
b. a declaration of the contract’s purpose.
c. a statement of the source of financing.
d. a description of the land.
29. Evermore Sports Gear Corporation and Trendy Goods, Inc., enter into a
contract. To be enforceable, the contract must include
a. no particular signatures.
b. the signatures of all parties to the deal.
c. the signature of the party against whom enforcement is sought.
d. the signature of the party who is seeking enforcement.
30. Chloe files a suit against Digital Associates, Inc. (DAI), to enforce a contract.
The only written evidence of the contract is a memo on DAI’s letterhead as
signed by a DAI officer in its files. The contract can be enforced if the memo
includes
a. a correct title, such as “Chloe–DAI Contract.”
b. all essential terms.
c. a statement of the consideration.
d. the parties’ addresses.
31. Brenda induces Carmen to enter into a contract for the sale of a gas station
and convenience store. Brenda tells Carmen that she is the sole owner, but
their signed, written contract lists Brenda’s parents as co-owners. The parol
evidence rule governs
a. contracts that are induced by fraud.
b. contracts that must be in writing to be enforceable.
c. the admissibility in court of oral evidence.
d. the merging of oral and written statements into one contract.
32. Hanson and Taylor sign a written contract for the transfer of Hanson’s Foot &
Ankle Clinic to Taylor. Hanson claims that the parties later orally agreed to
modify it. Any oral modification is likely not enforceable if it falls under
a. the doctrine of promissory estoppel.
b. the “main purpose” rule.
c. the “partial performance” exception.
d. the Statute of Frauds.
Fact Pattern 13-1 (Questions 33–34 apply)
Alain and Brie sign a contract for the sale of Alain’s Coffee Café to Brie. The parties
intend their written contract to be a final statement of most, but not all, of the terms of
their agreement—Alain must first buy the building from Developed Commercial
Properties, Inc., after which Alain and Brie will negotiate a price.
33. Refer to Fact Pattern 13-1. Brie later disputes some of the provisions of the
deal with Alain. If the dispute results in litigation, a court will most likely admit
evidence of additional terms that are
a. ambiguous.
b. consistent.
c. contradictory.
d. clear.
34. Refer to Fact Pattern 13-1. The writing that Alain and Brie signed is
a. a completely integrated contract.
b. a conditionally integrated contract.
c. a partially integrated contract.
d. a supplemental integrated contract.
35. Ulrich files a suit against Vern to enforce a written contract. If the court finds
that the parties intended the contract to be the final statement of their
agreement, parol evidence can be admitted to prove
18 UNIT TWO: CONTRACTS
a. an orally agreed-on condition precedent.
b. terms discussed before the contract but not contained in it.
c. terms discussed at the time of the contract that contradict the written
terms.
d. nothing.
ESSAY QUESTIONS
1. Raconteur Data Analysis Corporation in Seattle, Washington, offers a job to
Trista, who lives in Utah. Trista orally agrees to work for Raconteur for two
years. She moves her family to Seattle and begins work. Three months later,
she is fired for no stated cause. She files a suit against Raconteur for rein–
statement or pay. Raconteur pleads the lack of a written contract. In whose
favor is the court likely to rule, and why?
2. In a transaction for the sale of a warehouse, Standard Storage Company tells
Tri-County Investment Corporation that the office furniture is included. The
contract says nothing about office furniture, but does state, “This document
supersedes all oral promises relating to the sale.” Is the furniture part of the
sale? Why or why not?
