Florida Statute of Frauds

By May 9, 2017Corporate Law

The Statute of Frauds, in its simplest definition, cites that certain varieties of contracts must be made in writing. All parties involved must sign the document(s) and there must be adequate content to provide evidence for the contract to be valid. For example, if you are selling a property the contract must have within it all essential terms of the transaction and sale, and must be signed by both you and the buyer. The purpose of this is to ensure that no fraudulent claims are brought to court based on oral discussion, which is difficult to prove.

Traditionally, Statute of Frauds are applicable in the following situations:

  • Marriage (including prenuptial contracts)
  • Contracts not able to be performed within the space of one year
  • Transfer of land
  • Executor of Will
  • Sales of more than $500
  • Paying someone else debt

What is a Contract?

A contract is any agreement entered into by two or more parties and can concern any number of things. It is enforceable by civil law and is usually required to be in writing, so as to protect both parties if any dispute arises.  Most usually, a contract requires offer, acceptance, consideration and mutual intent to be valid. A contract may be found invalid if it is entered into by those who are not considered of sound mind or have the capacity to agree – for example those who are intoxicated, are minors or those who suffer from mental afflictions.

Statute of Frauds in Florida

Similarly to most states, Florida’s statute of Frauds requires that certain contracts and invalid unless they are in writing and signed.  This includes sales of goods over $500 and personal property over $5000, promises to pay debt of another and land conveyances. It no longer includes sales of securities.

Oral Contracts

Oral contracts are a more complex issue when it comes to Statute of Frauds. In the past, the Florida court has ruled that oral agreements used for the purchase of property have been valid and enforced in certain circumstances, for example if the purchasing party has been given the property and has paid part of the agreed price, or has made noted improvements. This is not typical for all cases, and is dependent on the individual circumstance.

A recent ruling in the Florida Supreme Court further clarified the states position on oral contracts, in Browning V Poirier (2015). In this case, a couple had agreed to split lottery winnings in 1993. This agreement was to last for as long as they were a couple. Fourteen years later in 2007 the girlfriend won $1 million, and allegedly refused to give her partner half.  The boyfriend filed suit in breach of the original oral contract. The trial ended in favor of the girlfriend. The case was then taken to the Court of Appeal, whereupon the original trial’s decision was upheld, with the boyfriend admitting that when they entered into the agreement, they intended on being together for more than a year – the DCA referring to the intention of each parties at the making of the contract.

The case was then taken to the Supreme Court, whereupon they disagreed with the previous rulings. They held that since the contract terms did not specifically state a time period and that it could have been performed within one year, the fact it lasted longer was not relevant. The Supreme Court ruled that if a contract theoretically has the capability of being performed within a year, then the Statute of Frauds is inapplicable and thus the oral contract enforceable.

Leave a Reply