What is the purpose of the statute of frauds?

The statute of frauds is a legal principle that serves the purpose of requiring certain types of contracts to be in writing in order to be enforceable. This requirement helps to prevent fraudulent claims and misunderstandings that may arise from verbal agreements. By specifying which contracts need to be documented, the statute provides clarity and promotes greater certainty in commercial and legal transactions.

This statute typically applies to contracts involving the sale of goods over a certain value, leases over a year, contracts that cannot be performed within one year, and agreements related to the sale of real property, among others. By mandating that these agreements be memorialized in writing, the statute helps protect against disputes regarding the terms and conditions of the contract and ensures that there is tangible evidence of the agreement in case enforcement is necessary.

The focus of this law is not on verbal agreements, tort definitions, or corporate regulations, but rather on establishing a clear framework for which contracts necessitate written agreements to uphold their legality. This foundational aspect of contract law promotes accountability and helps to mitigate the risks associated with informal agreements.