Which of the Following Contracts Must Be in Writing?
Contracts are legally binding agreements between two or more parties, outlining the terms and conditions of a particular transaction. While some contracts can be verbal, some require a written agreement to be legally enforceable. In this article, we will discuss which of the following contracts must be in writing.
1. Contracts for the Sale of Goods
Under the Uniform Commercial Code (UCC), contracts for the sale of goods valued at $500 or more must be in writing to be enforceable. This means that if you purchase goods worth $500 or more from a seller, or if you`re a seller and are agreeing to sell goods worth $500 or more, you`ll need a written contract.
2. Contracts that Cannot Be Performed in One Year
If the contract performance extends beyond a year, then it must be in writing. This is known as the “One-Year Rule.” Contracts that can be completed within a year do not need to be in writing. For example, if you hire a caterer for a one-time event, you can rely on a verbal agreement. However, if you`re hiring someone for a two-year project, you`ll need a written agreement.
3. Contracts for Real Estate Transactions
Contracts for the sale, lease, or transfer of real estate must be in writing. This type of contract is also known as a “deed” and must be signed by both parties. The contract should include a description of the property, the purchase price, and any conditions of the sale.
4. Contracts for Personal Property
Contracts for the transfer of personal property (i.e., property that is not real estate) valued at $500 or more must be in writing. This includes cars, boats, jewelry, and other personal property. The contract should include a description of the property, the purchase price, and any conditions of the sale.
5. Contracts for Services
Contracts for services can either be verbal or written, but it`s always better to have them in writing. A written contract can help avoid misunderstandings and disputes. It should include a description of the services, the cost, the payment terms, and the deadline for completion.
In conclusion, contracts that involve the sale of goods, real estate, personal property, and services, and those that cannot be performed within a year, must be in writing to be legally enforceable. If you`re entering into any of these types of contracts, it`s best to consult with a lawyer to ensure that your contract is legally binding and enforceable.