King,a circuit board manufacturer,called Foster,a computer storeowner,and offered to sell him 500 circuit boards for $20,000.Foster accepted the offer over the telephone that same day.King immediately sent Foster a signed memorandum confirming the deal they made orally.Which of the following statements concerning the contract is correct under the statute of frauds?
A)No contract was formed because Foster did not sign the offer.
B)No contract was formed because King is not a merchant.
C)A contract was formed unless Foster objects to the memorandum within 10 days of receiving it.
D)A contract was formed but it is unenforceable.

Question

Quizplus · Accepted Answer

According to the doctrine of "confirmatory memorandum" this is a valid contract.This exception applies only when both of the parties to a contract are merchants.Furthermore,the memo must be sent within a reasonable time after the contract is made and must be sufficient to bind the person who sent it if enforcement were sought against him (that is,it must indicate that a contract was made,state a quantity,and be signed by the sender).If the party against whom enforcement is sought receives the memo,has reason to know its contents,and yet fails to give written notice of objection to the contents of the memo within 10 days after receiving it,the memo can be introduced to meet the requirements of the statute of frauds.

King,a Circuit Board Manufacturer,called Foster,a Computer Storeowner,and Offered to Sell