Statute of Frauds
The statute of frauds is the rule that certain contracts must be in writing to be enforceable. It requires a contract conveying an interest in land to be written, to contain a legal description of the property, and to be signed by the party to be charged. The statute does not make an oral contract void, it makes it unenforceable.
The statute of frauds is a core part of the Contracts and Legal Descriptions sections of the national exam. It is tested through questions that ask whether a given agreement must be in writing, must contain a legal description, and must be signed.
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The rule behind the name
The statute of frauds is a writing requirement, not a fraud investigation. It says that certain contracts are enforceable only if they are in writing and signed by the party to be charged, meaning the person the other side is trying to hold to the deal. The point is to prevent people from being dragged into agreements that were never clearly made, and to make the key terms provable in court.
What real estate must satisfy
For a contract that conveys an interest in real property, three things are needed beyond the ordinary elements of a valid contract. The agreement must be in writing. It must contain a legal description of the property, specific enough to identify the parcel. And it must be signed by one or more of the parties, generally the party to be charged. A sales contract that skips any of these fails the statute of frauds and cannot be enforced, even if both people clearly meant to sell the house.
The one year lease exception
Not every real estate agreement needs paper. A lease of one year or shorter may be oral, because the statute targets agreements that cannot be performed within a year. A six month apartment lease, then, can be an enforceable oral contract. Extend the same lease past a year and the writing requirement snaps back on.
Void or just unenforceable?
This distinction trips up many test takers. A contract that violates the statute of frauds is not void and it is not illegal. It is unenforceable, which means the parties may still perform it voluntarily and a court simply will not order them to. That is why the statute of frauds is sometimes grouped with the unenforceable category rather than the void category.
An example
A buyer and seller agree orally on a price for a house, shake hands, and the buyer pays a deposit. No written contract is ever prepared. Later the seller changes their mind. Because the agreement was never reduced to writing and signed, the buyer cannot sue to force the sale: the contract is unenforceable under the statute of frauds. Partial performance can sometimes rescue an oral land contract in courts that recognize it, but the general exam rule is that the writing is required.
How this appears on the exam
Watch the wording of the question. If it asks whether an oral contract for land is void, the correct answer is usually that it is unenforceable, not void. If it asks the purpose of the statute, the answer is that certain conveyance related contracts must be in writing, and if it asks what a real estate sales contract must contain to be enforceable, choose the legal description plus a signature. Keep the one year lease exception in mind and you will separate the exceptions from the rule.
Memory trick
MYLEGS
The statute of frauds lists the categories of contracts that must be in writing. Real estate students learn them as M-Y-L-E-G-S.
- M
Marriage: a promise made in consideration of marriage must be written to be enforced
- Y
Year: a contract that cannot possibly be performed within one year has to be in writing
- L
Land: any contract conveying an interest in real estate must be written, signed, and contain a legal description
- E
Executor: a promise by an executor to pay an estate's debts from personal funds must be written
- G
Goods: a sale of goods above a set dollar amount must be written under the Uniform Commercial Code
- S
Surety: a promise to answer for another person's debt must be written to be enforceable
Screenshot this: MYLEGS is how you'll remember statute of frauds on exam day.
How the exam tricks you on this
The classic trap is the idea that the statute of frauds makes an oral contract void or illegal. It does not. An oral contract for land is valid in substance but unenforceable in court, which is why the best answer is usually unenforceable, not void.
Two more patterns to watch:
- The excepted lease. A lease of one year or less may be oral. Read the term carefully: a question that describes a six month apartment lease can have a correct answer of an enforceable oral agreement, while the same lease past twelve months needs writing.
- The statute does not stop fraud. Its name is misleading. The statute of frauds does not investigate or eliminate fraud, it simply requires certain contracts to be written and signed. A question asking its purpose wants the writing requirement, not fraud prevention.
Try real exam questions on statute of frauds
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A real estate sales contract, to be enforceable, must
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Related terms
Void vs. Voidable
A void contract never had any legal effect, so no one can enforce it and there is nothing to cancel. A voidable contract is valid and enforceable unless the party in the weaker position (a minor, or someone who was defrauded, coerced, or intoxicated) chooses to cancel it. Void means nobody can perform under it, voidable means one party can walk away.
Read definitionNovation vs. Assignment
Assignment transfers a party's interest in a contract to a third party, but the original party stays liable for the contract unless the other side releases them. Novation goes further: it substitutes a new party for the original one and releases the original from all further liability. A related move, delegation, transfers duties only, not rights.
Read definitionEscrow
Escrow is a neutral third-party arrangement that holds money and documents on behalf of a buyer and seller until every condition of the sale contract has been met. The escrow agent has no stake in the transaction: they simply follow the escrow instructions both parties signed, releasing funds and title only when every condition clears.
Read definitionTypes of Listing Agreements
There are four main types of listing agreement: open listing, exclusive agency, exclusive right to sell, and net listing. They differ in one thing, who the broker gets paid by. Under an open listing the broker is paid only if they are the one who brings the buyer, under exclusive agency the owner can still sell the property themselves and owe nothing, and under exclusive right to sell the broker earns a commission no matter who sells.
Read definitionMetes and Bounds
Metes and bounds is a legal description system that defines a parcel by its boundary lines, using reference points, compass directions (angles), and distances. The description begins at a point of beginning, follows each boundary around the perimeter, and returns to that same point to enclose the property. It is common for irregular parcels and rural land.
Read definitionVariance vs. Special Exception
A variance is zoning relief granted because a hardship unique to the property makes strict compliance unreasonable, such as an oddly shaped lot. A special exception is a use the zoning ordinance already allows in the district when stated conditions are met and the public interest is served. The variance turns on hardship, the special exception on public interest.
Read definition
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