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REG · Business Law · 6 practice questions

UCC Statute of Frauds: The $500 Writing Requirement

A sale of goods for $500 or more generally needs a signed writing unless an exception applies. Below, sort variations of Apex's chair purchase by whether a writing or accepted payment makes it enforceable.

The ruleFor goods priced at $500 or more, enforcement generally requires a writing indicating a sale, stating quantity, and signed by the party being sued. Accepted payment can make the sale enforceable for the goods paid for.

Try one first

Taylor orally agrees to buy 20 office chairs from Office Supply Co. for a total price of $1,200, with delivery scheduled for next month. The chairs are movable goods. No payment has been made, no chairs have been delivered or accepted, and neither party signed any writing. Assume no applicable exception to the Statute of Frauds applies. Which is the best conclusion?
Hint

First identify whether this is governed by common law or the UCC, then ask whether a dollar threshold triggers a writing requirement.

Sort it

Writing requirement unmet

The total is at least $500, but there is neither a sufficient seller-signed writing nor an exception.

Sufficient writing

A sale record states all 20 chairs and bears the seller's signature.

No writing needed

The total is below $500, or the seller accepted payment for all 20 chairs.

Only part enforceable

The signed quantity or accepted payment covers fewer than all 20 chairs.

ItemGoes to
Apex orally orders 20 standard office chairs for $1,200, due next month, and seeks enforcement against the seller. Neither party signs a writing. No payment or delivery occurs. Assume no exception applies unless stated.Writing requirement unmetThe $1,200 total triggers the rule. Delivery next month does not avoid it.
Same facts, except the total price for the 20 chairs is $400.No writing neededThe entire sale is below $500, so the UCC writing requirement does not apply.
Same facts, except the seller signs a sale memo listing 20 chairs and the $1,200 total.Sufficient writingThe memo indicates a sale, states the full quantity, and bears the seller's signature.
Same facts, except the seller accepts $600 as full payment for 10 specified chairs.Only part enforceableAccepted payment makes the sale enforceable for those 10 chairs, not the unpaid remainder.
Same facts, except the seller signs a sale memo stating $1,200 but no chair quantity.Writing requirement unmetA signature and price do not cure the missing quantity term.
Same facts, except the total price for the 20 chairs is exactly $500.Writing requirement unmetThe threshold includes exactly $500. No sufficient writing or exception is present.
Same facts, except the seller accepts the full $1,200 payment for all 20 chairs.No writing neededAccepted payment covers the entire order, so the payment exception permits enforcement without a writing.
Same facts, except Apex alone signs a sale memo stating 20 chairs.Writing requirement unmetApex seeks enforcement against the seller, but the seller did not sign.
Same facts, except the seller signs a sale memo listing only 10 chairs.Only part enforceableEnforcement against the seller cannot exceed the 10 chairs stated in the signed writing.
Same facts, except Apex mails a $1,200 check that the seller neither accepts nor cashes.Writing requirement unmetSending payment is not enough. The seller must accept it for the payment exception to apply.
Same facts, except the seller signs a sale memo stating 20 chairs but no price.Sufficient writingThe memo indicates a sale and states quantity. Omitting price does not defeat the writing.

Key points

  • Remember: The $500 test uses the whole sale, but enforcement reaches only the quantity covered by writing or accepted payment.
  • Apex needs the seller's signature to enforce against the seller. Apex's own signature is not enough.
  • A goods writing can omit price, but it must state quantity.
  • Mailing a check is not accepted payment.

How the exam traps you

  • Delivery next month means the oral sale is enforceable. Fast delivery does not defeat the $500 goods rule.
  • Any signed note is enough. Check the quantity and the signature of the party being sued.
  • Payment for some chairs validates the entire order. Accepted payment covers only the chairs paid for.

5 more, each from a different angle

0 of 5 answered · 0 correct

Question 2

Assume the exam's general common-law and UCC contract rules apply, and no statute-of-frauds exception applies unless stated. Which oral agreement is most likely unenforceable because it generally must be in writing?
Hint

Ask which choice falls into a classic statute-of-frauds category even though the other choices stay below common time or dollar triggers.

Question 3

On March 1, Year 1, BrandCo orally engaged Designer to create and revise package designs for a new product. The agreement stated that Designer's work would continue until BrandCo made its first commercial shipment of the product, but not longer than 18 months after March 1, Year 1. At formation, both parties expected the first shipment would likely occur in about 14 months, although shipment within 9 months was possible under the agreement. BrandCo stopped the project after 10 months and argues that the oral agreement is unenforceable under the Statute of Frauds. Assume no other Statute of Frauds provision is implicated. Under common-law contract principles, which factor most strongly governs whether the one-year provision applies?
Hint

Analyze the one-year provision from the date the oral agreement was made, and separate possible full performance from what the parties predicted or what later occurred.

Question 4

Under general contract law principles, and assuming no exception to any writing requirement applies, which oral agreement would generally be enforceable even though it was not put in writing?
Hint

Sort each option by the main Statute of Frauds categories: land, goods above the UCC threshold, and agreements that cannot be fully performed within one year.

Question 5

Assume the only issue is the common-law statute of frauds one-year provision and no writing exists. A company orally agrees to hire a janitorial firm. Under which set of terms is the agreement most likely enforceable without a writing?
Hint

Focus on whether the contract, by its own terms, can be fully performed within one year from the date the agreement is made.

Question 6

Which oral agreement would generally need to be evidenced by a writing to be enforceable under the statute of frauds, assuming no exception applies?
Hint

Separate goods contracts from service or employment contracts, and pay close attention to whether a stated dollar threshold or the one-year rule applies.

Drill all 126 Contracts questionsMixed across every rule in the topic, so you have to spot which one applies. That is how the exam does it.

Common questions

Does the UCC Statute of Frauds apply at exactly $500?

Yes. The threshold is $500 or more for the total sale, so Apex's $500 variation requires a sufficient writing or an exception.

What must a UCC Statute of Frauds writing contain?

It must indicate a sale, state quantity, and be signed by the party against whom enforcement is sought. Apex needs the seller's signature; a missing price does not defeat an otherwise sufficient writing.

Does partial payment satisfy the UCC Statute of Frauds?

Only to the extent payment is made and accepted. If the seller accepts $600 as full payment for 10 chairs, Apex can enforce that portion without a writing, not the entire 20-chair order.

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