😀
Real Property • Conveyances
PROP#154
Legal Definition
The Statute of Frauds applies to land sale contracts, which must be (1) in writing; (2) signed by the party to be charged, (3) that contains the essential terms (e.g., parties, land, price).
However, part performance can take the contract out of the statute, where a party meets 2 of the following 3 requirements: (1) possession, (2) payment, or (3) improvements.
However, part performance can take the contract out of the statute, where a party meets 2 of the following 3 requirements: (1) possession, (2) payment, or (3) improvements.
Plain English Explanation
Whenever you spot a transaction involving someone buying or selling land, you'll usually need to assess whether or not the facts satisfy the Statute of Frauds. Why? Because land is important and the courts don't want to waste time with people bringing claims that are hard to verify without a written contract.
However, there is an exception. A claimant need not satisfy the Statute of Frauds if 2 of the following 3 factors are met:
(1) Possession, meaning the person claiming they bought the land is in possession of the land;
(2) Payment, meaning the person claiming they bought the land has evidence that they transferred money to the person they claim sold them the land; and
(3) Improvements, meaning the person claiming they bought the land has invested resources and money in improving the land.
However, there is an exception. A claimant need not satisfy the Statute of Frauds if 2 of the following 3 factors are met:
(1) Possession, meaning the person claiming they bought the land is in possession of the land;
(2) Payment, meaning the person claiming they bought the land has evidence that they transferred money to the person they claim sold them the land; and
(3) Improvements, meaning the person claiming they bought the land has invested resources and money in improving the land.
Hypothetical
Hypo 1: Amy owns Whiteacre. Bob wants to buy it from her. Bob offers $100,000. Amy accepts. Bob transfers the money and begins hiring landscapers to fix up Whiteacre, puts a new roof on the house, and installs a pool. Amy dies and her heirs bring a suit against Bob claiming he has no right Whiteacre. Bob has no written contract of his purchase. Result: Though Bob's oral contract with Amy does not satisfy the Statute of Frauds, Bob will be able to successfully show 2 important factors: The first, that he transferred a sizeable amount of money to Amy. The second, that he has invested substantial resources in fixing up Whiteacre. Both of these things are the type of thing reasonable people do when they have purchased a property. To ignore them would be to believe Bob gave Amy $100,000 for some other reason while simultaneously deciding to gift her substantial improvements to Whiteacre, which is silly.
Related Concepts
At closing, what is the implied covenant of marketable title?
How does a court treat a deed made to defraud creditors?
How does a court treat a voidable deed?
How does a court treat a void deed?
How may a defect in the Chain of Title impact an Implied Covenant of Marketable Title?
How may an encumbrance impact an Implied Covenant of Marketable Title?
How may zoning impact an Implied Covenant of Marketable Title?
In assessing a conveyance of land, what are the types of notice?
In assessing a Doctrine of Equitable Conversion issue, how does death affect passage of title?
In assessing a Doctrine of Equitable Conversion issue, how does the Uniform Vendor and Purchaser Risk Act affect risk?
In assessing a seller's liabilities for defective real property, what constitutes failure to disclose?
In assessing a seller's liabilities for defective real property, when is a disclaimer sufficient to avoid liability?
In assessing a seller's liabilities for defective real property, when is a seller liable for defects they do not mention?
In assessing a seller's liabilities for defective real property, when is a seller liable for misrepresentation or fraud?
In assessing a seller's liabilities for defective real property, when is there a warranty of fitness or quality?
In assessing deed warranties, what is Against Encumbrances?
In assessing deed warranties, what is Right to Convey?
In assessing the formalities of a deed, what are the rules of construction and priority for the description of the land?
In assessing the formalities of a deed, when is acceptance valid?
In assessing the formalities of a deed, when is a description of land sufficient?
In assessing the formalities of a deed, when is delivery valid?
In assessing the warranties under a general warranty deed, what is Further Assurances?
In assessing the warranties under a general warranty deed, what is Quiet Enjoyment?
In assessing the warranties under a general warranty deed, what is Seisin?
In assessing the warranties under a general warranty deed, what is Warranty?
In land sale contracts, when is time of the essence?
In land sale contracts, when must each party tender performance?
Under a notice recording statute, when does a subsequent Bona Fide Purchaser prevail?
Under a race-notice recording statute, when does a subsequent Bona Fide Purchaser prevail?
Under a race recording statute, when does a subsequent Bona Fide Purchaser prevail?
What are the 3 types of deeds and warranties?
What are the requirements for a valid deed?
What is a general warranty deed?
What is a quitclaim deed?
What is a special warranty deed?
What is a wild deed?
What is estoppel by deed?
What is the Doctrine of Equitable Conversion?
What is the Shelter Rule?
What remedies are available to a buyer upon violation of an Implied Covenant of Marketable Title?
What remedies are available to parties of a land sale contract if one of them breaches?
When may a deed be an inter vivos gift?
Who does title insurance protect?
Who qualifies as a purchaser for value?
