Statute of Frauds in Ontario

The Statute of Frauds is an Ontario law requiring certain types of contracts to be in writing to be legally enforceable. 

The law exists to prevent fraud and misunderstandings about important agreements. By requiring written evidence, it protects people from false claims about contracts they never actually made.

The Statute of Frauds serves several important purposes.

Preventing False Claims: Without written evidence, people could falsely claim contracts existed. Someone might lie about an oral agreement to buy property or guarantee a debt. 

Avoiding Misunderstandings: Even honest people remember conversations differently. Written contracts provide clear evidence of what was actually agreed, preventing disputes about terms.

Providing Reliable Evidence: Written contracts give courts reliable evidence of what parties agreed to, making it easier to enforce legitimate agreements and dismiss false claims.

The Statute of Frauds applies when you’re trying to enforce a contract that falls into one of the covered categories and there’s no sufficient written evidence of the agreement.

If someone sues you claiming you agreed to buy their property or guarantee a loan, but there’s nothing in writing, you can defend the claim by pointing to the Statute of Frauds.

The writing doesn’t need to be a formal contract drafted by lawyers. It can be an email, letter, text message, or any written document that contains the essential terms of the agreement.

The writing must identify the parties, describe the subject matter (like which property is being sold), state the essential terms (like purchase price), and be signed by the person you’re trying to enforce it against.

Even when the Statute of Frauds applies, courts recognize exceptions in certain circumstances.

Part Performance: If someone has partially performed their obligations under an oral contract in ways that clearly point to the contract’s existence, courts may enforce it despite the lack of writing. For example, if you moved into property and made substantial improvements based on an oral purchase agreement, the doctrine of part performance might apply.

Promissory Estoppel: If you relied on someone’s promise to your detriment, and it would be unfair to let them escape the promise simply because it wasn’t written, courts may enforce it through promissory estoppel.

Fraud or Misrepresentation: The Statute of Frauds won’t protect someone who fraudulently induced you into an oral agreement.

If you’ve made an oral agreement that falls under the Statute of Frauds, get it in writing immediately, ideally with a lawyer’s help. Consult a lawyer about whether exceptions like part performance might apply.

Contact us at 416.901.9984 or info@pintoshekib.ca.