Myth: Oral (unwritten) contracts are not valid. Fact: Oral contracts are just as enforceable as written contracts,but they are more difficult to prove. The statute of frauds (Minn. Stat. Ch. 513) and the Uniform Commercial Code do require a written contract in certain circumstances. The writing requirement of the statute of frauds is different from the issue of whether a contract exists. The writing that is required by the statute is not the contract. Rather, it is the written evidence of the contract. See Simplex Supplies, Inc. v. Abhe & Svoboda, Inc., 586 N.W.2d 797, 800 (Minn. App. 1998).
Myth: If there is a problem with a contract, the negotiations that took place before signing can help resolve the problem. Fact: All conversations or writings that took place before the contract is signed merge into the contract and cannot be used. (There are some limited exceptions.) “Oral evidence of discussions, negotiations, or understanding is not admissible to vary or to contradict terms of an unambiguous or integrated contract.” Jara v. Buckbee-Mears Co., 469 N.W.2d 727, 730 (Minn. App. 1991) (citing Jansen v, Herman, 230 N.W.2d 460, 463 (Minn. 1975). Myth: If the other side breaches the contract, you can recover attorney fees. Fact: Attorney fees will not be recoverable in a contract action unless they are specifically provided for in the contract or authorized by statute. See Schwickert, Inc. v. Winnebago Seniors Ltd., 680 N.W.2d 79 (Minn. 2004).
Susan Dickel Minsberg
Attorney at Law, St. Paul