Question 1

An unwritten contract that the Statute of Frauds requires to be evidenced in writing is still valid and it is merely unenforceable by the courts.

Accepted Answer

The Statute of Frauds requires certain types of contracts to be in writing to be enforceable in court. However, if such a contract is not in writing, it is not invalid but rather unenforceable, meaning the courts will not compel performance based on the unwritten agreement.

Question 2

In most jurisdictions, if the court classifies the nature of a third-party agreement as a guarantee, there is no requirement of writing.

Accepted Answer

In most jurisdictions, a guarantee must be in writing to be enforceable due to the Statute of Frauds, which requires certain types of contracts, including guarantees, to be in writing to prevent fraudulent claims.

Question 3

All contracts that have the effect of restricting competition are void.

Accepted Answer

Not all contracts that restrict competition are void. Many jurisdictions allow for certain restrictive agreements if they are reasonable in scope and duration, serve legitimate business interests, and do not unduly harm competition.

Question 4

Only contracts involving significant sums of money must be in writing to be enforceable.

Accepted Answer

Many types of contracts must be in writing to be enforceable due to the Statute of Frauds, not just those involving significant sums of money. This includes contracts for the sale of real estate, contracts that cannot be performed within one year, and certain goods contracts under the Uniform Commercial Code, among others.

Question 5

All commercial contracts must be evidenced by writing to be enforceable.

Accepted Answer

Many commercial contracts can be legally binding and enforceable even if they are made orally or through conduct, without being in writing. However, certain types of contracts do require written evidence to be enforceable, such as contracts for the sale of real estate.

Question 6

Contracts may be in writing, they may be under seal, or they may simply be verbal, but they may not be implied from the conduct of the parties.

Accepted Answer

Contracts can indeed be implied from the conduct of the parties, where the circumstances indicate that there is an agreement even though it has not been explicitly stated.

Question 7

Contracts may be in writing, under seal, verbal, or even implied.

Accepted Answer

Contracts can be formed in various ways, including written, under seal, verbally, or through actions and conduct that imply agreement and intent to be legally bound.

Question 8

All contracts must be in writing to be enforceable.

Accepted Answer

Not all contracts need to be in writing to be enforceable. Some contracts, such as verbal contracts, are still legally binding. However, certain types of contracts, such as real estate contracts, must be in writing to be enforceable.

Question 9

Contracts to commit a crime or a tort are void.

Accepted Answer

Contracts that involve committing a crime or a tort (a wrongful act leading to civil legal liability) are considered void because they are against public policy.

Question 10

The first Statute of Frauds was enacted in the USA in the 20th century.

Accepted Answer

The first Statute of Frauds was enacted in England in 1677, not in the USA, and it was well before the 20th century.

Question 11

When the terms of an agreement make it impossible to perform the contract within one full year from the time the contract is entered into, there must be evidence in writing for it to be enforceable.

Accepted Answer

This is due to the Statute of Frauds, which requires certain types of contracts, including those that cannot be performed within one year from the date of agreement, to be in writing to be enforceable.

Question 12

All contracts must be written to be binding.

Accepted Answer

Many contracts can be binding even if they are verbal or implied by conduct, as long as they meet the necessary legal requirements.

Question 13

The creation of a joint tenancy in land must be evidenced in writing.

Accepted Answer

The creation of a joint tenancy in land must be evidenced in writing due to the Statute of Frauds, which requires certain contracts, including those for the transfer of interests in real property, to be in writing to be enforceable.

Question 14

Today, there is no general rule that a contract must take a certain form, although most jurisdictions have statutory requirements regarding the transfer of land.

Accepted Answer

Most jurisdictions allow contracts to be made in any form, including orally, in writing, or even implied by conduct, except for specific types of contracts such as those involving the transfer of land, which typically must be in writing due to statutory requirements like the Statute of Frauds.

Question 15

A contract that has been partially performed will be enforceable even though it is not in writing as required under the Statute of Frauds.

Accepted Answer

The partial performance of a contract can serve as an exception to the Statute of Frauds, making the contract enforceable even if it is not in writing, as it demonstrates a commitment to the contract terms by the actions taken.

Question 16

If a person says that he had not intended to be bound by an agreement when he entered it, there can be no contract.

Accepted Answer

For a contract to be valid, it generally requires an offer, acceptance, consideration, and mutual intent to be bound. The subjective intention of not wanting to be bound, if not communicated to the other party at the time of agreement, does not invalidate the contract if all other elements are present.

Question 17

If a contract is not evidenced in writing this does not make it void, only unenforceable.

Accepted Answer

A contract not evidenced in writing may still be valid but unenforceable in court, depending on the type of contract and jurisdiction.

Question 18

Even in commercial relationships, if the parties make it absolutely clear that they don't intend the arrangement to be legally binding on them, the agreement will not be enforceable in court.

Accepted Answer

In contract law, if both parties expressly state that they do not intend their agreement to be legally binding, courts will generally respect this intention and not enforce the agreement.

Question 19

Only contracts that involve the commission of a crime or tort are void on the basis of illegality.

Accepted Answer

Contracts can also be void due to illegality if they involve actions that are against public policy, even if those actions do not constitute a crime or tort.

Question 20

Legislation is now in place in several jurisdictions to give digital records and electronic signatures the status of written documents.

Accepted Answer

Many jurisdictions around the world have enacted legislation, such as the Electronic Signatures in Global and National Commerce Act (ESIGN) in the United States and the Electronic Communications Act in the United Kingdom, to give digital records and electronic signatures legal recognition equivalent to that of traditional paper documents and handwritten signatures.

Quiz 7: The Elements of a Contract: Capacity, Legality, and Intention