Question

Assume at the end of the meeting between Jack, Hal, and Sophia, they orally agree to enter into three separate contracts. One contract is for the sale of the intellectual property of the restaurant itself for $1,000,000. The second contract is for the sale of the building that the restaurant is located in for $250,000. The third contract is for the original sign that was outside the restaurant that Jack currently has in his garage, for $400. Which of these agreements violates the Statute of Frauds? The sale of the building only. The sale of the building and the sale of the intellectual property. The sale of the intellectual property and the sale of the sign. All of the agreements violate the Statute of Frauds.

Answer 1

Answer:

The answer is Sale of building and the sale of the intellectual property.

Explanation:

The Statute of Frauds requires that certain type of contract are mandatorily entered into between individuals in writing, especially property related contracts and . This legal concept excludes goods sold for value less than $500.

In this case, Jack, Hal and Sophia have agreed orally to enter into three separate contracts. One for the sale of intellectual property of the restaurant for $1,000,000/-. Second for the sale of restaurant building for $250,000/-, Since these are contracts involving substantial amounts and are long term in nature, it is mandated under the US laws that such contracts are in writing and shall not be orally binding.

But the their contract is for the sale of the sign that was outside the restaurant for $400. Since the value of the transaction is less than $500/-, it is ok if this contract is entered into between he three orally. Hence the statute of frauds principle is violated only under the 1st and 2nd contracts as the values are substantial and to eliminate any dispute arising in the contract in the future, the contracts are entered into between the parties in writing.