Statute of Frauds Requirements in Real Estate Transfers
Any contract for the sale or transfer of real estate must be in writing in order for it to be enforceable. This is the law in Michigan and most, if not all, other states. Leases lasting longer than one year must also be in writing. This is the “statute of frauds” requirement and is a legal term you have probably already heard of and may even be familiar with. However, what exactly is a “writing?” In order for a document to be a “writing,” must it be written in legalese using terms that sound like a book from the 1800s? Luckily, the answer is no, although there are some basic requirements.
Besides being in writing, the contract for the sale or transfer of real estate must contain the substantive terms of the transaction, such as identifying the parties to the contract, consideration (usually the price being paid for the real estate) and a description of the real estate being transferred. The writing must also contain a signature of the party to whom the contract is being enforced against. For example, if the buyer of real estate wants to sue the seller for breach of contract, the writing must contain the seller’s signature or vice versa. Note that the signature doesn’t always have to be the actual buyer or seller; the signature can be from one of their respective authorized representatives.
Lastly, as long as the writing contains the necessary information and signature(s), there is no requirement as to its form. It can be a series of e-mail messages, a formal contract or a receipt. Of course, enforcing a contract may be easier with a formal written agreement, but that is not a statute of frauds requirement.
For more information about the requirements for transferring real estate or other issues relating to the statute of frauds, please contact us.