Question

The Statute of Frauds requires that certain contracts be reduced to writing. In which scenarios must contracts be written to be enforceable? Why do you believe that such contracts would need to be written? and Identify at least two scenarios in which an equitable remedy would be more appropriate than an award of money damages.

Answer 1

The Statute of Frauds requires that certain contracts be reduced to writing. In the following scenarios, contracts must be in writing to be enforceable:

1. Transfer or sale of land
2. Sale of goods over $500
3. Contracts that cannot be fully completed within one year
4. Marriage
5. Promise to pay another person’s debt (“surety contracts”)
6. Contracts that will continue beyond the lifetime of a party performing the contract

The above contracts need to be in writing as an oral contract is not valid in many states. Also proving an existence of an oral contract becomes very difficult. When the contracts are in writing, they become legally enforceable and the parties to the contract are obliged to fulfill the conditions therein. Written contracts help in clearly identifying the roles and responsibilities of the parties involved.

In case of breach of contracts, the suffering party can be given a monetory remedy or an equitable remedy. Equitable remedy means that the court will enforce upon the defaulting party to fulfill or perform the contract instead of offering money damages. Scenarios in which an equitable remedy would be more appropriate than an award of money damages are:

1. When an employee has entered in a non compete agreement with his employer. But later upon resigning he enters into same and competing business. In such cases, court can grant equitable remedy to the employer by asking the employee to stop his competing business.
2. When a contractor is employed to build a specifically designed building and he dishonors the contract halfway, the aggrieved party can claim equitable remedy of completing the building rather than monetory damage.