Business Scenarios (c) T re 16-1. The One-Year Rule. On May 1, by telephone, Yu
ID: 370624 • Letter: B
Question
Business Scenarios (c) T re 16-1. The One-Year Rule. On May 1, by telephone, Yu offers to hire Benson to perform personal services. On May 5, Benson returns Yu's call and accepts the offer. Discuss fully whether this contract falls under the Statute of Frauds in the following circumstances: (See page 279.) (a) The contract calls for Benson to be employed for one St 16-2 ware broth the d able? year, with the right to begin performance immediately. (b) The contract calls for Benson to be employed for nine months, with performance of services to begin on September 1. Business Case Problems 16-3. The Parol Evidence Rule. Evangel Temnle of God leased a facilitr
Explanation / Answer
16-1) Statute of Frauds require contracts that cannot be completed in one year be written down. The One Year rule emphasises on the need of the contract to be completed in a year. It does not necessarily has to complete in one year. Moreover it gets into effect once the contract is created i.e. both the parties agree on the work. It is immaterial when the work is supposed to begin.
a) Benson accepts Yu's offer of work on 5th so this is the day when the contract was created. So Benson is liable to work for 1 year from 5th and not 1st May when Yu had offered Benson the job. So Statute Of Frauds is not applicable here.
b) Statute of Frauds gets into effect from 5th May when Benson accepts the contract. It is immaterial whether the work starts in September or November. Statute of Frauds is in force in this case.
c) The One Year Rule is applicable for issues where things CAN get completed in one year however it is not necessary for them to be completed in 1 year. Benson will take 2 years to complete his study which means that the work cannot be reasonable finished in 1 year making Statute of Frauds not applicable.
16-2) Coallition Contracts irrespective of whether these are written or oral, need to be separate contract. In our case, Mallory agrees to pay for the lawn mower if her brother fails to pay the debt. If this needs to be enforceable, it should be added with the main contract which is not given in the examples.
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