Reference no: EM132276385

Contracts

Ch. 16-17

Instructions: Please answer the following questions. Your responses will be graded based upon accuracy; professionalism (grammar, spelling); and thoroughness of explanation. When complete, please make sure your name is on your assignment, save as a Microsoft Word file, and submit it in your assignment folder. Feel free to submit this assignment prior to its due date. Late assignments will NOT be accepted.

1. List the contracts that must be evidenced in writing or they cannot be enforced.

Usually, oral contracts are enforceable. However, the Statute of Frauds and Parol Evidence Rule are contracts that must be evidenced in writing.

The Statute of Fraud requires that six kinds of contracts be put in writing in order to be enforceable. If a contract falls into one of these categories, the contract is "within the statute" and must be in writing. If the contract does not fall into one of these six categories, the contract is "outside the statute" and does not need to be in writing.

The six categories of contracts that must be written down in order to satisfy the Statute of Frauds are:

1. contracts for the sale of an interest in land,

2. contracts for the sale of goods for $500 or more (under the U.C.C.),

3. contracts in consideration of marriage,

4. contracts that cannot be performed within one year of the contract being made,

5. contracts of suretyship,

6. contracts where an estate executor agrees to pay estate debts from his personal funds.

Any kind of writing will be adequate to satisfy the Statute of Frauds. However, the writing must contain the essential terms of the contract, including who the contracting parties are, the subject matter of the contract and the terms and conditions of the agreement. Also, the writing must be signed by the party to be charged (i.e., the contract must be signed in order to hold a party liable to it). If any party to the contract does not sign it, that party cannot be held liable under the contract.

The parol evidence rule must also be evidenced in writing in order to be enforced. The parol evidence rule governs the extent to which parties to a case may introduce into court evidence of a prior or contemporaneous agreement in order to modify, explain, or supplement the contract at issue.

The rule excludes the admission of parol evidence. This means that when the parties to a contract have made and signed a completely integrated written contract, evidence of antecedent negotiations (called "parol evidence") will not be admissible for the purpose of varying or contradicting what is written into the contract.

2. Sarah entered into an oral agreement to work for Jones Day Law Firm in New York for five years. She packed up her stuff, resigned from her current employer and sold her home. When she arrived in New York, she was told that the hiring partner had been terminated and they will not be hiring her. Sarah told the partners that she was told that she would receive a bonus for moving of $5000.

Although the moving bonus was standard practice, the partners refused to pay Sarah because the contract was not in writing. Using IRAC determine if Jones Day Law Firm is correct that they do not have to pay Sarah because of the Statute of Frauds.

Issue:

Rule:

Analysis:

Conclusion:

3. Junior Jones contracted with Betsy Brown to live at one of her rental properties for a year. While Junior was viewing the property, Betsy told Junior if he rented the property today should would throw in free house keeping for a year. Junior decided to sign the lease for a year.

However, the lease did not mention the free house keeping. Junior sued Betsy for the house keeping services he was promise. Using IRAC and the parol evidence rule determine the outcome of the law suit.

Issue:

Rule:

Analysis:

Conclusion:

4. The parol evidence rule will not apply in what circumstances?

The parol evidence rule does not bar parol evidence when (1) the writing is ambiguous, (2) the writing is not a true statement of the agreement of the parties because of fraud, duress, or mistake, or (3) the existence, modification, or illegality of a contract is in controversy.

5. When the court is looking at the rules of construction and interpretation, what six things to they look at in the contract?
When courts are looking at the rule of construction and interpretation, they are looking for the following:

1) intention of the parties,

2) whole contract,

3) contradictory and ambiguous terms,

4) implied terms,

5) conduct and custom,

6) and avoidance of hardship.

6. Morris made an oral contract with Marty's Mechanic Shop to work as its manager for two years. Marty wrote Morris a letter stating they had made an oral agreement for Morris to be the manager and it listed the salary, start date and all other terms that was discussed. Marty later refused to recognize the contract. Morris sued for breach of contract and offered Marty's letter in evidence of proof of the contract.

Using IRAC determine whether the contract was binding.

7. List all the nonassignable rights.

8. Bailey obtained a life insurance policy. He named his sister Hailey as the beneficiary. Hailey and Bailey had an argument and Bailey removed her as his beneficiary. When Bailey died, Hailey sued the insurance company for her money as Bailey's beneficiary. Using IRAC determine the outcome?

9. My neighbor decided to fix up his house. I was excited because that meant it would improve my properties value. My neighbor contracted with TDH Associates to repair his roof, paint his house and do some landscaping. TDH Associates do not fulfill their obligations. Using IRAC, if I sue TDH Associates what is the outcome?

10. Marissa rent an apartment from Cabana Bay in January. The lease was for a year. In June, Marissa received a job offer in another state. She did not want to break her lease, therefore she sub-leased or assigned her lease to Olivia. Marissa did not get permission from Cabana Bay.

Olivia moves in and pays rent from June to October. Cabana Bay sues Marissa for the two months of rent. Marissa believes she is not liable for the rent because she assigned her lease to Olivia. Using IRAC, determine whether Marissa correct.