Exam 17: Writing, Electronic Forms, and Interpretation of Contracts

An insurance company cannot refuse to pay the fire loss of the buyer of a house on the grounds that the sales contract for the house was not binding because it was not properly signed.

Customs and trade usage can override the express provisions of a contract.

The past performance of the parties under a continuing contract is important in determining what the contract means.

When a contract falls within the statute of frauds, the signatures of both parties must be shown to the court.

Through incorporation by deference, a contract can consist of both the original document and the detailed statement that is incorporated in it.

Because many oral contracts are legally enforceable, it is a good business practice in the preliminary stages of discussions to stipulate that no binding agreement is intended to be formed until a written contract is prepared and signed by the parties.

Parol evidence may be admissible to:

The one-year performance requirement for an oral contract begins:

In interpreting an ambiguous contract, one part of the contract:

The statute of frauds applies to:

A contract is created by which the terms are stated to be for consideration in the amount of $3,000. If typewritten in the contract is the term "four thousand dollars," while the amount of $3,000 is printed within the form:

A promise to grant a mortgage on real property does not require written proof because it is not a transfer of land.

Jones and Clark entered into a written contract for the purchase of an apartment building by Clark. The contract was carefully drafted to set forth the agreement of the parties. It was signed by both parties. Clark subsequently claimed that the contract did not cover all the terms included in the written and oral agreements that the parties had made during their prior negotiations. Jones claimed that the parol evidence rule barred proof of all of their prior agreements. Which claim would be upheld in court?

The parol evidence rule may not apply if:

The parol evidence rule generally precludes testimony that would contradict a complete written contract.

The parol evidence rule does not prohibit proof that:

A promise to pay an attorney a fee owed by a third person can be enforced without a writing.

Details of performance of a contract not expressly stated in a contract will often be implied by the court.

The parol evidence rule is based on the theory that either there never was an oral agreement or, if there was, the parties purposely abandoned it when they executed their written contract.

The parol evidence rule generally excludes words spoken before or at the time a written contract was executed from contradicting the terms of the contract.