California Statute of Frauds – The Law Offices of Andy I. Chen

California Statute of Frauds – The Law Offices of Andy I. Chen

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Hi everybody, it’s Andy and welcome again to my office in Los Altos, California. I’m an attorney licensed to practice law in
California as well as New York. In this video I’m going to go over a contract
law concept called the Statute of Frauds. Now I’m going to specifically talk about
the California Statute of Frauds, if you hang out with me to the very end of the
video, I’m going to talk about it. But the basic idea of the statute of frauds is
not unique to California. Other states in the US have it also. If you are outside
of the United States and I know that some of you are, I don’t know, I guess, you
know, country by country, whether or not the statute of frauds exists. I also
don’t know which country you’re watching me from. So my usual advice, I guess, for
looking stuff up outside the United States is that you basically have to
check whether or not what I’m talking about applies in your country. So this
video is going to be California-specific, but hopefully, I guess, you know, it should
give you some ideas about what to do, research on for your particular
situation. So all of that said then despite having, I guess, somewhat of an
intimidating name, the statute of frauds concept is actually fairly simple.
Basically it says that, you know, regardless of what the parties may want,
regardless of what might seem sort of common sense, I guess, under a situation,
the law requires that certain contracts have to be in writing. A verbal agreement,
not enough. A handshake deal, not enough. A writing has to exist. So now practically-
speaking it’s not going to be a big deal usually to write something down. You know, just just take a few minutes, write it down whatever. It’s not usually a big
deal. Practically speaking, it can be sort of an awkward thing to do, though. So the
thing is if you have a contract where you are, sorry, if you have an agreement
rather that you are negotiating with somebody, you’ve done business with them before, they might be somebody who you are really trying to curry favor with, to
basically ask them for something in writing might seem like, you know, you’re
saying that, you know, you don’t trust them or that you think that they’re
going to, you know, cheat you or something. All of that stuff aside, though, like, you
know, the Statute of Frauds does basically require a contract, er, sorry
require a writing anyway. So it is something, unfortunately, that you were
going to have to basically deal with. Find a way
to basically asked for the writing somehow. So hopefully all of that made
sense. The basic idea behind the Statute of Frauds is, like I said, not unique to
California but I am going to talk about the California one in more detail if you
hang out with me to the very end here, in just a second, but before I do that, I’ll
ask you guys again, of course, to comment, subscribe, share, like, all that
nice stuff. Yeah, so anyway, so all of that said then, I’ll go ahead and discuss the
California Statute of Frauds right now. So the Statute of Frauds requires that
certain contracts have to be in writing in order to be enforceable. This is an
exception to the general rule in California that contracts do not have to
be in writing. They can be oral. This is under Civil Code section 1622 which I
will paste and link down in the description below for you. I guess aside
from what the statutes actually require, I think a lot of us probably have, you know,
horror stories, life experience, etc that basically tell us that, you know, an oral
agreement is not, you know, nearly as good as a written contract. So, you know, even
though a written contract is not required in, you know, most cases you
should try to get one anyway. The statute of frauds idea just basically pushes
that principle one step further to say that, you know, under these situations, you know, these limited situations, you absolutely have to get this in writing.
So the word writing under the statute of frauds actually has a fairly broad
definition also. You don’t have to have a written document that is actually signed
and dated by each party. It’s helpful if you do and, you know, if you can do that,
by all means do that, but you can use other means as well. You know text
messages, emails etc to prove that a writing was what was actually made. So
this idea of a Statute of Frauds is not specific to California. Most US states
will have a version of it, but you know the big caveat here is that if you are
not in California, this video does not apply to you. So you have to read the
statute or statutes in your state to see what your Statute of Frauds requires in
terms of like criteria, you know, what exceptions apply, etc. In California the
Statute of Frauds is under Civil Code section 1624 which I will go ahead and
paste and link down below in the description for you also. But if you read
1624, it’s fairly long, but if you read it, there are seven situations in
California where the Statute of Frauds absolutely requires a writing in order
to make the contract enforceable. Those seven situations are not exhaustive,
meaning that, you know, there are other situations, er, sorry other statutes
rather under California law that also impose requirements that agreements be
in writing. As far as I’m able to tell, there is no kind of logic or rhyme or
reason as to how those other statutes are laid out. They appear random to me,
like, you know, that just a lot of, a lot of stuff in California statutes is
random like that, but if you know of a reason why those statutes are laid out
the way they are, go ahead and leave me a comment or otherwise let me know. So
hopefully all of that made sense. I’m going to go ahead and go over hopefully
some, at least, of the seven situations that the California Statute of Frauds
requires a writing for. So the first one is an agreement that, by its terms, can’t
be performed within, within one year of its making. The basic idea here is
that if a contract is made and performing, you know, either party
performing under the contract is physically impossible within one year
like, you know, it would require time travel or cloning or something that
basically cannot be done, that agreement has to be in writing in order to be
enforced. Number two is that if you are guaranteeing or promising to pay another
person’s debts, that agreement has to be in writing also, subject to any exception
that might apply under symbol Code section 2794 which, again, I will also
paste and link down below in the description. Number three and number four actually read very similarly. Number three is an agreement to sell
real estate or lease real estate for period longer than a year. What they’re
talking about here, like the agreement they’re talking about here, basically is
the agreement between the buyer and the seller, for example, or the landlord and
the tenant. The agent’s signature of like basically to have the buyer’s agent
sign for him, you know, if they’re buying, buying real estate, that is not
sufficient. The sellers agent signing for the seller, that’s not sufficient.
Landlord’s agent, you know, tenant’s agent. The agent’s signature is not sufficient.
Number four actually refers to the agreement between the buyer and the
buyer’s agent, you know, if there is one, the seller and the seller’s agent. So
number three basically refers to the agreement between the two sides of the
transaction and number four refers to the agreement between, I guess, either
side of the transaction and the agent representing them. Number five is an
agreement that by its terms cannot be performed within the promissor’s
lifetime. The promissor basically is the party to the contract that, er, the party
to the agreement rather, that is charged with doing something, like you know,
they’re the one who has to do something under the terms of the agreement. If that
agreement cannot be performed within that person’s lifetime, that has, that
agreement has to be in writing in order to be enforced. Number 6 I’m not going to
talk about a whole lot. I think basically the idea is that, you know, if you are
buying a piece of real estate and you’re assuming a mortgage obligation with it,
that obligation has to be in writing in order to be enforced. I think that’s
pretty common sense, I guess, based. Hopefully that should make sense to
everybody. Number seven is that, you know, if a loan is being made or credit is
being extended where the amount extended is more than a hundred thousand dollars,
that loan or that credit has to be, you know, put into, put into writing. Mainly
because, you know, if it’s not, then the lender has no way of enforcing, you know,
repayment if the borrower doesn’t. Yeah. So all of that said hopefully, you know, it all made sense, but the last point I want to emphasize again is that
under the statute of frauds, because it is so limited, precise language is very,
very, very important. So if you are in California, I don’t mean for this video
to be an exhaustive kind of, kind of, I guess, exercise or kind of review of the
statute of frauds. If you’re wondering whether or not, for example, you know, your loan qualifies, you know, under number 7, you have to go and read the actual
statute, uh, sec, excuse me, 1624 of the Civil Code. You have to look at that
because I have not copied it word for word. Yeah this video is just to kind of
introduce the idea and kind of go over it briefly. And if you are in other
states, you know, not California, as I said a moment ago, you definitely have to read
the statute, the code sections, whatever it’s called in your state to see what
requirements your statute of frauds has, what criteria, what exceptions, all that
stuff. So hopefully all of that made sense. The takeaway here is that, you know, in general in California, contracts can be oral. A writing is not required,
although as we discussed, it’s a very good idea to have it anyway. In very
limited circumstances, the Statute of Frauds says that a writing is absolutely
required. Yeah, so the thing is if you fall under any one of the seven then you
absolutely have to have a writing and if you don’t and you’re trying to enforce
the contract to make the other person do something under the contract, you know, you, you can’t basically because you don’t have a writing. So hopefully all of that
made sense. Go ahead and, you know, share this video, like, subscribe, comment, all at
my stuff and I will talk to you next time. Thanks.

One thought on “California Statute of Frauds – The Law Offices of Andy I. Chen

  • Heatherlyn Bevard Post author

    Is a document fraud if an officer testified he did not know how his name and signature got onto the document, nor has he been trained to do the task listed nor does he know how to do it,

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