1. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 1 Chapter 10 10-2The Statute of Frauds  GOALS  Explain why the Statute of Frauds is necessary and what it requires  Identify the main instances when the Statute of Frauds requires a writing  Understand the rules of contract interpretation

2. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 2 Chapter 10 WHY HAVE A STATUTE OF FRAUDS?  Contracts within the Statute of Frauds  Executed contracts  Executory contracts  Requirements of the writing  Statute of Frauds requirements  UCC requirements  Special rules for signatures

3. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 3 Chapter 10 CHECKPOINT  Name the six essential elements in a writing required by the most demanding Statutes of Frauds standards.     

4. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 4 Chapter 10 TYPES OF CONTRACTS WITHIN THE STATUTE OF FRAUDS  Contract for the sale of goods for $500 or more  Contract to sell an interest in real property  Contracts that require more than one year to complete  Contract to pay a debt or answer for another’s debt or the debts of an estate  Exception—main purpose rule  Contract for which the consideration is marriage

5. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 5 Chapter 10 CHECKPOINT  What amount must be exceeded to require a contract for the sale of goods to be in writing to be enforceable?     

6. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 6 Chapter 10 HOW ARE CONTRACTS INTERPRETED?  Acknowledgement of final agreement  Specific rules of interpretation  Analysis  Conflicting terms  Words  Ambiguities  Implied reasonableness  Parol evidence rule  Exceptions to the parol evidence rule

7. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 7 Chapter 10 CHECKPOINT  Explain the parol evidence rule.     

8. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 8 Chapter 10 PREVENT LEGAL DIFFICULTIES  In making contracts...  Deal only with persons who are reputable and properly licensed when contracting for professional or skilled services.  Do not rush into a decision. Take time to review and understand the advantages and disadvantages of the contract. Legitimate proposals usually will survive a delay. Continued on the next slide

9. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 9 Chapter 10 PREVENT LEGAL DIFFICULTIES  If the contract is complex or involves much time or money, put it in writing even when the Statute of Frauds does not require this. Try to anticipate and provide for all possible problems. If needed, obtain the assistance of a qualified lawyer.  If a prepared contract is presented to you for your signature read it carefully, especially if it is a contract of adhesion. If the contract involves a large sum of money, or if it is complex, have your lawyer review it before you sign. Continued on the next slide

10. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 10 Chapter 10 PREVENT LEGAL DIFFICULTIES  Insist that all terms of the contract that you do not understand be defined and explained. Make necessary changes, or reject the entire contract.  Make sure that all changes are written into a contract on all copies as well as on the original, and that all changes are initialed by both parties. Retain a copy with the other party’s signature on it.  Be sure all desired terms are expressed in writing or included by specific reference to any other relevant document(s). Continued on the next slide

11. LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Slide 11 Chapter 10 PREVENT LEGAL DIFFICULTIES  When any payments have been made in cash, be sure to get a receipt if payment is not acknowledged in the contract. Continued on the next slide