Three Types Of Unenforceable Frauds

X. Unenforceable Contracts

Unenforceable Contracts

Unenforceable Contracts are defined as those contracts that are considered from the word itself, unenforceable meaning these are contracts that cannot be enforced or given effect in a court of law or sued upon by reason of certain defects provided by law until and unless they are cured or ratified according to law unlike rescissible and voidable contracts which are valid and enforceable unless rescinded or annulled.

Kinds of Unenforceable Contracts

Here are the three types of defects that render contracts unenforceable:

a. Contracts that entered into the name of another by one without, or acting in excess of, authority;

b. Contracts that do not comply with the Statute of Frauds

c. Contracts

History

Statute of Frauds started in the 1677 where it is enacted by the English Parliament to counter the evil practice of giving false testimony in actions founded on certain kinds of contracts. Statute only is later on called as Statute of Frauds.

b. Purpose

Statute of Frauds is enacted to guard against the mistakes of honest men by requiring that certain agreements specified that are susceptible to fraud must be in writing; otherwise considered unenforceable by the court.

c. “Writing” under the Statute

Agreements within the scope of the Statute of Frauds

Contracts can be made orally or in a written form. However there are agreements between parties, which are considered within the scope of the Statute of Frauds.

It is stated in article 1403 that the following agreements which are not legally enforceable in court are:

1. Agreement not to be performed within one year from the making thereof

2. Promise to answer the debt, default, or miscarriage of another

3. Agreement in consideration of marriage other than mutual promise to marry.

4. Agreement for sale of goods, etc. at price not less than P500.00

5. Agreement for leasing for a longer period than one year

6. Agreement for sale of real property or of an interest

It is also not applicable when the contract is admitted expressly, or impliedly by the failure to deny specifically its existence, no further evidence required. In addition, if agreement between parties is not stated in the written contract. It is only applicable to completely executory contracts where in there still no performance made by both parties and not to contracts which are totally executed or partly executory since partial performances furnish reliable evidence of the intention of the parties or existence of the contract.

Ratification of contracts infringing the Statute of Frauds may be effected in two ways:

1. By failure to object to the presentation of oral evidences to prove the contract which amounts to a waiver and makes the contract as binding as if it has been reduced to writing.

2. By acceptance of benefits under the contract where in the contract weren’t be able to be executed that’s why Statute does not