What is the correct answer to: In Michigan, the Statute of Frauds requires real estate contracts to be:

The correct answer is In writing and signed by the party to be charged. Under Michigan's Statute of Frauds (MCL 566.108), a contract for the purchase or sale of real estate must be in writing and signed by the party to be charged — meaning the person against whom the contract is being enforced must have signed it. This requirement ensures enforceability and prevents one party from fabricating the existence or terms of an oral real estate agreement in litigation.

What background knowledge is needed for this Contracts question?

The Statute of Frauds originated in England with the 'Act for Prevention of Frauds and Perjuries' passed by Parliament in 1677, designed to stop parties from using perjured testimony to enforce fictitious oral contracts. American states, including Michigan, adopted their own versions of this statute as part of their common law heritage. Michigan's Statute of Frauds is found in the Revised Judicature Act and related statutes, including MCL 566.108, and has remained largely consistent in its real property provisions for over a century. The 'party to be charged' language is a deliberate asymmetry — only the defendant's signature is required, meaning a buyer could enforce a signed seller's contract even if the buyer never signed.

What is a good way to remember the answer to this Contracts question?

Remember 'FRAUD needs WRITING' — the Statute of Frauds prevents fraud by requiring writing. For the 'party to be charged' element, picture a criminal being 'charged' in court: the prosecutor only needs evidence against the defendant (the party being charged), not a confession from the victim. Similarly, only the party being sued needs to have signed the contract. Remember that real estate contracts need to be Written, signed by the Party to be charged, and required by the Statute of Frauds. This acronym helps you recall the three essential elements.

What exam tip applies to this Contracts question?

On Michigan real estate exams, any answer choice suggesting that verbal agreements are sufficient for real estate contracts is automatically wrong — this is a bright-line rule with no exceptions for informal agreements. Pay close attention to the phrase 'party to be charged,' as exam questions sometimes try to trick you into thinking both parties must sign, when in fact only the defendant's signature is required for enforceability.

How does this Contracts concept apply in real world practice?

Tom verbally agreed to sell his Grand Rapids home to Linda for $250,000, and they shook hands on the deal. When Tom later received a higher offer and backed out, Linda tried to sue for breach of contract. The Michigan court dismissed her case because there was no written, signed agreement — the oral deal was unenforceable under MCL 566.108, no matter how many witnesses heard the handshake agreement. Had Linda obtained even a simple signed written offer from Tom, she would have had an enforceable contract.

ContractsGeneralEASY

In Michigan, the Statute of Frauds requires real estate contracts to be:

Correct Answer

B) In writing and signed by the party to be charged

Michigan's Statute of Frauds requires real estate contracts to be in writing and signed by the party to be charged to be enforceable.

Answer Options

Verbal agreements are sufficient

In writing and signed by the party to be charged

Notarized to be valid

Witnessed by two people

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Financing Contingency

A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.

Inspection Contingency

An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.

Liquidated Damages

Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.

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