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					INSTITUTE OF LAW RESEARCH AND REFORM
         THE UNIVERSITY OF ALBERTA
            EDMONTON, ALBERTA



          Background Paper No. 12




     STATUTE OF FRAUDS


                 March 1979
I N S T I T U T E O F LAW RESEARCH AND REFORM


       T H E U N I V E R S I T Y OF ALBERTA


            EDMONTON, ALBERTA




        BACKGROUND P A P E R NO.      12




           S T A T U T E O F FRAUDS




                 March, 1 9 7 9
                                        F
                                 TABLE O CONTENTS

                                                                                         Page No.

  I.   INTRODUCTION         ...              .                    .  .                       1

 11.   HISTORICAL BACKGROUND O STATUTE O FRAUDS . . .
                                         F                F                                  4

I1 .
  1    ADVANTAGES AID DISADVANTAGES O STATUTES       F
       OFFRAUDS . . . . . . . . . . . . . . . . . . .                                        6

       A.  Advantages o f t h e S t a t u t e of F r a u d s     ....                        6

           1. E v i d e n t i a r y F u n c t i o n . . . . . . . . . .                      6
           2.
           3.
               The C a u t i o n a r y F u n c t i o n   .. ......
               The C h a n n e l l i n g F u n c t i o n . . . . . . . .
                                                                                             7
                                                                                             8

       B.    D i s a d v a n t a g e s and C r i t i c i s m s o f t h e S t a t u t e
             of F r a u d s   .................                                              9

           1. The A c t C a u s e s I n j u s t i c e . . . . . . . .                        9
           2.    The S t a t u t e C a u s e s U n n e c e s s a r y
                 Litigation . . . . . . . . . . . . . . .                                   10
           3.    The S t a t u t e i s a P r o d u c t of C o n d i t i o n s

           4.
                 Which N o Longer E x i s t             .........
                 The S t a t u t e i s n o t i n C o n f o r m i t y w i t h
                                                                                            11


           5.
                 Actual P r a c t i c e      ............
                 The S t a t u t e R e n d e r s C o n t r a c t s Unenf o r c e -
                                                                                            11

                 a b l e But Does N o t A f f e c t T h e i r
                 Validity . . . . . . . . . . . . . . . .                                   12

 IV.                          H
       CONTRACTS FOR T E SALE OF, OR APTY INTEREST IT4
       ORCONCERNING, L N        A D          ...                                            14

       A.  " N o A c t i o n s h a l l be Brought" . . . . . . . .                          16

       B.  The R e q u i r e m e n t o f a S u f f i c j e n t N o t e o r
           Memorandum . . . . . . . . . . . . . . . . .                                     18

           1. Time by Which t h e N o t e or Memorandum
                 Must be i n E x i s t e n c e . . . . . . . . . .                          18
           2.
           3.
                 Form o f N o t e or Memorandum R e q u i r e d
                 C o n t e n t s o f t h e Note o r Memorandum . . .
                                                                              ..            18
                                                                                            19
           4.    The R e q u i s i t e S i g n a t u r e . . . . . . . .                    21
           5.    J o i n d e r o f Documents . . . . . . . . . .                            22

       C.    Meaning o f " C o n t r a c t o r S a l e o f Land,
             Tenements o r H e r e d i t a m e n t s o r any I n t e r e s t
                                             ...........
             i n o r c o n c e r n i n g them"                                              24

             1.
             2.
                    Produce of t h e S o i l  ..........
                    Fixtures . . . . . . . . . . . . . . . .
                                                                                            25
                                                                                            28
                                                                               Page N o   .
               3
               4
                .
                .                           .......
                    S a l e s o f M i n e r a l s and O i l s
                    A g r e e m e n t s About P r o c e e d s From S a l e s
                                                                                   28

               5.
                    o f Land              .........
                                   ................
                    C o l l a t e r a l Agreements
                                                                                   29
                                                                                   29
               6.                                ..
                    A g r e e m e n t s t o S e l l o r P u r c h a s e Land       30

       D   .   R e l i e f A v a i l a b l e Where T h e r e H a s Been
               Non-Compliance         ...............                              31

                 .
               1 D o c t r i n e of P a r t P e r f o r m a n c e . . . . . .
               2 . The S t a t u t e o f F r a u d s Cannot B e Used
                                                                                   31

                   a s a n I n s t r u m e n t of F r a u d . . . . . . .          40
               3 . Quasi-Contract . . . . . . . . . . . . .                        41

                   ( a ) Money had and r e c e i v e d
                    ( b ) Account s t a t e d        ..........   ......           41
                                                                                   42
                    (c) Quantum m e r u i t . . . . . . . . . .                    42
       E   .   E v a l u a t i o n of t h e Law and P r o p o s a l s f o r
               Reform   ...................                                        44
                 C o n t r a c t s f o r t h e S a l e o f Land; t h e
                 Q u e s t i o n of Repeal . . . . . . . . . .
                 Whether C o n t r a c t s f o r t h e S a l e of Land
                 S h o u l d be R e q u i r e d to ke i n W r i t i n g
                 The R e q u i r e m e n t o f a S u f f i c i e n t N o t e
                                                                             .
                 or Memorandum . . . . . . . . . . . .
                 C o n t r a c t s E x e c u t e d by Both P a r t i e s . .
                 D o c t r i n e o f P a r t Performance . . . . .
                 A c t s Done by t h e D e f e n d a n t . . . . . .
                 Damages          ...............
                 Q u a s i - C o n t r a c t u a l Remedies . . . . . .
                 R e a l E s t a t e Agency C o n t r a c t s . . . . .

 V . CONVEYANCES OF INTERESTS I N LAND . . . . . . . .                             63
      A . S e c t i o n s 1 and 3 o f t h e S t a t u t e o f F r a u d s      .   63
      B . S e c t i o n 2 o f t h e S t a t u t e of F r a u d s .                 68
            .
          1 A n a l y s i s o f t h e Law . . . . . . . . . .
          2 . E v a l u a t i o n o f t h e Law and P r o p o s a l s
                                                                                   68
                  forReform . . . . . . . . . . . . . . .                          72
      C . S e c t i o n 3 o f t h e R e a l P r o p e r t y Amendment
          Act        ....................                                          74
V I . CONTRACTS FOR T E SALE O GOODS
                              H                  F         ........                77
      A . R e c e i p t and A c c e p t a n c e o f t h e Goods        ....        78
                                                                                     P a g e No.

        B.    T h e G i v i n g of S o m e t h i n g i n E a r n e s t t o B i n d
              the C o n t r a c t o r i n P a r t P a y m e n t    ......
        C.    Meaning of C o n t r a c t f o r t h e Sale of G o o d s .

        D.    E v a l u a t i o n of t h e L a w and P r o p o s a l s f o r
              Reform . . . . . . . . . . . . . . . . . . .

 VII.   SECTION 7 OF THE STATUTE OF FRAUDS:
        AND CREATION OF TRUSTS OF LAND--                     . . DECLARATION.
                                                                     .....
        A.  O p e r a t i o n of t h e S e c t i o n . . . . . . . . . .

            1. Scope of A p p l i c a t i o n . . . . . . . . . .
            2.
            3.
                   T h e Writing R e q u i r e m e n t       ........
                   L e g a l E f f e c t Where W r i t i n g R e q u i r e m e n t
                   is not Satisfied . . . . . . . . . . . .

        B.  A v a i l a b l e R e l i e f Where N o n - C o m p l i a n c e w i t h
            Section 7 . . . . . . . . . . . . . . . . .
            1. S e c t i o n 8 of t h e S t a t u t e of F r a u d s . . .
            2.     T h e E q u i t a b l e D o c t r i n e of F r a u d - - T h e
                   S t a t u t e of F r a u d s C a n n o t be U s e d a s an
                    I n s t r u m e n t of F r a u d . . . . . . . . . .
        C.  E v a l u a t i o n of t h e L a w and P r o p o s a l s f o r
            Reform . . . . . . . . . . . . . . . . . . .

VIII.   SECTION 9:          GRANTS AND ASSIGZJMENTS OF TRUSTS
        ANDCONFIDENCES                  ... ....
        A.  Operation             .................
        B.  E v a l u a t i o n of t h e Law and P r o p o s a l s f o r
            Reform . . . . . . . . . . . . . . . . . . .

  IX.   SECTION 4:  CONTRACTS TO CHARGE THE DEFENDANT
        UPON A SPECIAL PROMISE TO ANSWER FOR THE DEBT,
        DEFAULT OR MISCARRIAGE OR ANOTHER PERSON                     ....
        A.  Scope of A p p l i c a t i o n . . . . . . . . . . . .

        B.  E v a l u a t i o n of t h e Law and P r o p o s a l s f o r
            Reform . . . . . . . . . . . . . . . . . . .

   X.   SECTION 4:          CONTRACTS NOT TO RE PERFORMED WITHIN
        ONE YEAR FROM THE MAKING THEREOF . . . . . . . .

        A.  Application           ................
                                                                                     Page No.

           B.   E v a l u a t i o n of t h e L a w and Proposals f o r
                R e f o r m . . . . . . . . . . . . . . . . . . .                        124

  XI.      SECTION 4:   CONTRACTS TO CHARGE AN EXECUTOR OR
           ADMIIJISTRATOR UPON ANY S P E C I A L PROMISE OR ANSWER
           DAMAGES OUT OF I I I S OWN ESTATE                .........                    128

 XI1   .   SECTION 4:  CONTRACTS TO CHARGE ANY PERSON UPON
           ANY AGREEMENT MADE UPON CONSIDERATION OR
           M     A     R     R     I    A      G    E      .                             130

XI11   .   SECTION 6 : LORD TENTERDEN I S ACT:
           TATIONS AS TO CREDIT ~ R T H I N E S S              . MISREPRESEN- .
                                                                 ......                  i3i

           A.   T h e R e q u i r e m e n t of W r i t i n g .   .......                 131

           B.   Scope of A p p l i c a t i o n . . . . . . . . . . . .                   131

           C.   E v a l u a t i o n of t h e L a w and Proposals f o r
                R e f o r m . . . . . . . . . . . . . . . . . . .                        132

 XN.       SECTION 5 : LORD TENTERDEN                s   ACT :    RATIFICATION
           O F I N F A N T S ' CONTRACTS                                                 134




  REPORTS REFERRED T O               . . .............                                   138
                   - Amendments         t o t h e S t a t u t e of Frauds
  APPENDIX A
                       and S u g g e s t i o n s of L a w R e f o r m B o d i e s   ..   139

                   -
  APPENDIX B
                                                           .
                                     . . . . . . . . . . . c. .3 . . .
                       S t a t u t e of Frauds, 2 9 C a r .
                       (1677)
                                                                   1
                                                                  1 .
                                                                                         142

  APPENDIX C       -   S t a t u t e of Frauds A m e n d m e n t A c t [ L o r d
                       Tenterden's Act]
                       ss. 5 and 6          . . .1 8.2 8.) .9 .G e.o .. N ,. c. .1 4.,
                                                (
                                                                        . .              151
  APPENDIX D       -   The G u a r a n t e e s Acknowledgement Act, 1969

                                            ..............
                       [S.A. 1 9 6 9 , c. 4 1 , a s a m e n d e d by S.A.
                       1 9 7 0 , c. 4 1 1                                                152
                          PREFACE


     The Statute of Frauds is a 300-year-old enactment
requiring that a number of kinds of transactions be in writing
or be evidenced by writing. The Institute of Law Research and
Reform has undertaken a study of the law in connection with
the Statute of Frauds and other related legislation, including
the Guarantees Acknowledgment Act, section 7 of the Sale of
Goods Act and section 22 of the Real Estate Agents' Licensing
Act.

     In the course of the Statute of Frauds project, the
Institute asked Professor Robert Nozick of the Faculty of Law
at the University of Alberta to prepare a draft of a Working
Paper, using the information contained in two research papers
written in 1974-75 by Douglas R. Stollery, then a student on
the Institute's staff. The Institute had then intended that
the draft Working Paper should become the vehicle for consulta-
tion with the public and also serve as the basis for discussion
of the subject by the Institute's Board of Directors. Later,
however, the Board came to the conclusion that an abbreviated
and simplified discussion of the issues would more likely be
read by the public than a thorough and comprehensive discussion
such as that contained in the draft Working Paper, and
accordingly the Board has decided that the consultative document
should be a memorandum for discussion rather than a Working
Paper. So that the valuable research and analysis contained
in the draft Working Paper will be available to those who want
to go more deeply into the subject, we are issuing the draft
as a Background Paper. We would also refer interested persons
to Mr. Stollery's article, "Statute of Frauds", which appears
in Volume 14 of the Alberta Law Review, 1976 at page 222.
        R e a d e r s a r e a d v i s e d t h a t o t h e r demands on t h e I n s t i t u t e ' s
t i m e have p r e c l u d e d e f f o r t s t o u p d a t e t h i s Background P a p e r
o r a l t e r i t s format f o r publication.                 I t should a l s o be noted
t h a t s i n c e P r o f e s s o r Nozick was i n p a r t t r y i n g t o a n t i c i p a t e
t h e policy p o s i t i o n s of t h e I n s t i t u t e ' s aoard of Directors,
a n d i n view o f t h e h i s t o r y s e t f o r t h a b o v e , t h e o p i n i o n s
e x p r e s s e d i n t h i s Background P a p e r a r e n o t n e c e s s a r i l y t h e
v i e w s o f e i t h e r P r o f e s s o r Nozick o r t h e I n s t i t u t e .

     The I n s t i t u t e would b e i n t e r e s t e d i n r e c e i v i n g comments
and opinions about reform o r r e p e a l of t h e w r i t i n g requirements
s e t o u t i n t h e S t a t u t e o f F r a u d s and r e l a t e d A c t s , a n d would
ask t h a t submissions be s e n t t o :

               The I n s t i t u t e of Law R e s e a r c h and Reform,
               4 0 2 Law C e n t r e ,
               The U n i v e r s i t y o f A l b e r t a ,
               Edmonton, A l b e r t a T6G 2H5.

       I n d u e c o u r s e t h e I n s t i t u t e p r o p o s e s t o i s s u e a R e p o r t on
t h e S t a t u t e of Frauds.
                                             CHAPTER I

                                         INTRODUCTION


         The S t a t u t e of Frauds was enacted i n 1677. A s t h e name
i m p l i e s , t h e reason f o r i t s enactment was t o p r e v e n t f r a u d and
perjury.           Indeed t h e opening words of t h e S t a t u t e a r e , "For
p r e v e n t i o n of many f r a u d u l e n t P r a c t i c e s which a r e commonly
endeavoured t o be upheld by P e r j u r y and Subornation of
P e r j u r y . . . I 1 The S t a t u t e seeks t o p r e v e n t f r a u d , p e r j u r y and
s u b o r n a t i o n of p e r j u r y by r e q u i r i n g t r a n s a c t i o n s enumerated i n
t h e S t a t u t e e i t h e r t o be evidenced i n w r i t i n g o r , i n some
c a s e s , a c t u a l l y t o be i n w r i t i n g .

       June 2 4 , 1977 marked t h e t e r c e n t e n a r y of t h e S t a t u t e of
Frauds.       I t i s s t i l l i n f o r c e i n A l b e r t a a s p a r t of t h e law
of England r e c e i v e d i n t o A l b e r t a . Conditions have, of c o u r s e ,
changed c o n s i d e r a b l y over t h e p a s t 300 y e a r s and a review of
t h e provisions contained within the S t a t u t e is desirable.

        I t i s t h e purpose of t h i s Working Paper t o e x p l o r e
whether t h e i n d i v i d u a l p r o v i s i o n s of t h e S t a t u t e of Frauds and
r e l a t e d Acts should be r e t a i n e d , and, i f so, whether they
should be r e t a i n e d i n t h e i r p r e s e n t form.

       The f o l l o w i n g c a t e g o r i e s o r t r a n s a c t i o n s o r u n d e r t a k i n g s
w i l l be d i s c u s s e d i n d i v i d u a l l y i n t h i s Working Paper.

        1.    C o n t r a c t s f o r t h e S a l e of an I n t e r e s t i n Land.
              (Ch. I V of t h i s Working Paper)                    .
        2.    C r e a t i o n s and T r a n s f e r s of I n t e r e s t s i n Land.
              (Ch. V of t h i s Working Paper)                  .
        3.    C o n t r a c t s f o r t h e S a l e of Goods.
              (Ch. V I of t h i s Working Paper)                    .
        4.     C r e a t i o n s and D e c l a r a t i o n s of T r u s t s of Land.
                (Ch. V I I of t h i s Working P a p e r ) .


        5.     Grants and Assignments of I n t e r e s t s under a
               Trust.         (Ch. V I I I of t h i s Working P a p e r ) .


        6.     Guarantees.             (Ch. I X of t h i s Working P a p e r )                .
        7.     C o n t r a c t s Not t o B e Performed Within a Year.
                (Ch. X of t h i s Working P a p e r )               .
        8.     C o n t r a c t s t o Charge an Executor o r A d m i n i s t r a t o r .
                (Ch. X I of t h i s Working P a p e r )               .
        9.     C o n t r a c t s Made Upon C o n s i d e r a t i o n of Marriage.
                (Ch. X I 1 of t h i s Working P a p e r )                 .
       10.     M i s r e p r e s e n t a t i o n s as t o C r e d i t w o r t h i n e s s .
                (Ch. X I 1 1 of t h i s Working P a p e r ) .


       11.     R a t i f i c a t i o n of I n f a n t s '   Contracts.
                (Ch. X I V of t h i s Working P a p e r )                 .
        I n r e s p e c t of e a c h of t h e s e c a t e g o r i e s ,          after a brief
a n a l y s i s of t h e p r e s e n t s t a t e o f t h e law,               the following
q u e s t i o n s w i l l be c o n s i d e r e d :


         1.    OUGHT THERE TO BE ANY W R I T I N G REQUIREMENT
                O
               F R THIS CATEGORY?


         2.    IF A W R I T I N G mQUIREMENT IS TO BE RETAINED WHAT
                H UD
               S O L THAT REQUIREMENT ENTAIL?


        T h i s q u e s t i o n r a i s e s such i s s u e s a s whether t h e under-
t a k i n g ought t o - i n w r i t i n g i n o r d e r t o be v a l i d o r i f it
                      be
ought merely t o be evidenced i n w r i t i n g i n o r d e r t o be e n f o r c e -
-
a b l e ; what should c o n s t i t u t e a s u f f i c i e n t w r i t i n g o r memorandum
 ( i . e . ought t h e w r i t i n g t o evidence only t h a t t h e r e i s a con-
t r a c t o r ought it t o prove a l l t h e m a t e r i a l terms of t h a t
c o n t r a c t ? ) ; and what t y p e s of terms ought t o be c o n s i d e r e d
material.

       3.    IF THERE IS NON-COMPLIANCE                    WITH THE W R I T I N G REQUIRE-
             MENT OUGHT T I E R E TO BE ANY OTHER RELIEF AVAILABLE?


       This q u e s t i o n r a i s e s f o r c o n s i d e r a t i o n t h e a p p l i c a t i o n
of t h e d o c t r i n e of p a r t performance and whether t h e scope
of t h i s d o c t r i n e should be broadened.                 I t a l s o involves a
c o n s i d e r a t i o n of t h e n a t u r e of r e l i e f a v a i l a b l e on t h e grounds
of u n j u s t enrichment, q u a s i - c o n t r a c t ,       etc.

                                                                     e
         Before a n a l y z i n g each of t h e c a t e g o r i e s w s h a l l con-
s i d e r i n Chapter I1 t h e h i s t o r i c a l background of t h e S t a t u t e
of Frauds and i n Chapter I11 t h e f u n c t i o n s which a w r i t i n g
requirement can s e r v e , a s w e l l a s t h e d i s a d v a n t a g e s and c r i t i -
cisms normally a s s o c i a t e d w i t h a w r i t i n g requirement. An
i n i t i a l r e a d i n g of C h a p t e r s I1 and I11 should e n a b l e t h e
reader t o consider i n a b e t t e r perspective the r a t h e r diverse
categories discussed i n following chapters.

       The I n s t i t u t e welcomes comments addressed t o it in w r i t i n g
a t 402 Law Centre, U n i v e r s i t y of A l b e r t a , Edmonton, A l b e r t a ,
T6G 2H5. Cornments should r e f e r by number t o any r e l e v a n t
q u e s t i o n s i n t h i s Working Paper.
                                        CHAPTER I1

                                     F         F
              HISTORICAL BACKGROUND O STATUTE O FRAUDS

        I t has been s a i d t h a t ,                                it i s urged
                                              " F i r s t and foremost,
t h a t t h e Act i s a p r o d u c t of c o n d i t i o n s which have long passed
away    ...       [TI he p r o v i s i o n s of S e c t i o n 4 a r e an anachronism.
A c o n d i t i o n of t h i n g s which was advanced i n r e l a t i o n t o 1 6 7 7
i s backward in r e l a t i o n t o 1937."--Law Revision Committee [of
G r e a t B r i t a i n ] , S i x t h I n t e r i m Report, Cmd. 5449, 1937, a t 6, 7.

        There were a t l e a s t f o u r " f a c t o r s " which e x i s t e d i n
1677 which no l o n g e r e x i s t today.


        F i r s t , p a r t i e s t o an a c t i o n , t h e i r husbands o r wives,
and persons w i t h an i n t e r e s t i n t h e r e s u l t of t h e a c t i o n
were n o t competent t o t e s t i f y .            A s Simpson          (A.W.B.   Simpson,
A H i s t o r y of t h e Common Law of C o n t r a c t , a t 605) has noted t h e
common law d i d n o t         ". . . adopt         the canonical r u l e requiring a
minimum of two w i t n e s s e s f o r proof of a f a c t ; a s i n g l e w i t n e s s
o r i n t h e o r y no w i t n e s s a t a l l would s u f f i c e , t h e p l a i n t i f f ' s
d e c l a r a t i o n p r o v i d i n g him w i t h h i s s o l e o p p o r t u n i t y t o s e t o u t
a s e t of averments which were n o t , of c o u r s e , t e s t a b l e by c r o s s
examination o r i n q u i s i t i o n by t h e c o u r t . "           Given t h i s s t a t e of
a f f a i r s an e v i d e n t i a r y requirement of a w r i t i n g o r memorandum
signed by t h e d e f e n d a n t was v a l u a b l e and may indeed have i n i t i -
a l l y prevented many f r a u d s .

        Second, t r i a l by j u r y was i n a s t a t e of t r a n s i t i o n .              It
was s t i l l p o s s i b l e a t t h e time of t h e enactment of t h e S t a t u t e
of Frauds f o r j u r o r s t o d e c i d e c a s e s on t h e b a s i s of t h e i r own
p e r s o n a l knowledge.        Simpson (Simpson, 604 ) n o t e s t h a t t h e r e
was I t .   ..    a g e n e r a l d i s s a t i s f a c t i o n with t h e o p e r a t i o n of jury
trials      . . ."    and t h a t     ". . .         it was t h i s d i s s a t i s f a c t i o n which
gave r i s e t o t h e d e s i r e t o reform t h e law.             "
        A t h i r d f a c t o r i s t h a t c o n d i t i o n s in England were u n s e t t l e d
a t t h e time of t h e enactment of t h e S t a t u t e .                      There had been a
long period of p o l i t i c a l t u r m o i l .             "No l e g i s l a t i o n had been
enacted a f f e c t i n g ordinary l i t i g a t i o n .    The o r d i n a r y law c o u r t s
had been f u n c t i o n i n g under g r e a t d i f f i c u l t i e s . Subornation and
p e r j u r y e v i d e n t l y were r i f e .   "--[ D r a c h s l e r ,   "The B r i t i s h S t a t u t e
of Frauds--British Reform and American E x p e r i e n c e , " (1958-1960),
A.B.A. S e c t i o n of I n t e r n a t i o n a l and Cooperative Law B u l l e t i n
3-4,    241   .
        F i n a l l y , it s h o u l d be noted t h a t           ". . . contemporaries
were, by modern s t a n d a r d s , extremely l i t i g i o u s , so t h a t oppor-
t u n i t i e s t o b r i n g g r o u n d l e s s s u i t s were l i k e l y t o be taken                ..
. . Litigation           indeed came c l o s e t o a form of s a n c t i o n e d
a g g r e s s i o n , and it was an a g g r e s s i v e age."--[Simpson,     5991.

        The above c o n d i t i o n s e x p l a i n t h e m o t i v a t i o n f o r , and
perhaps j u s t i f y ,      t h e enactment of t h e S t a t u t e of Frauds in
1677.      None of t h e s e c o n d i t i o n s e x i s t s in A l b e r t a today.
There may however be o t h e r compelling r e a s o n s which j u s t i f y
a requirement of e v i d e n c e i n w r i t i n g f o r a t l e a s t some of
t h e c a t e g o r i e s of t r a n s a c t i o n s p r e s e n t l y f a l l i n g w i t h i n t h e
S t a t u t e of Frauds.
                                            CHAPTER I11
                          ADVANTAGES AND DISADVANTAGES OF
                                          F
                                 STATUTE O FRAUDS


          I n d e c i d i n g whether t h e r e q u i r e m e n t of w r i t i n g f o r any
p a r t i c u l a r c a t e g o r y of t r a n s a c t i o n s p r e s e n t l y f a l l i n g w i t h i n
t h e S t a t u t e of F r a u d s o u g h t t o be r e t a i n e d , t h e a d v a n t a g e s
o f r e t a i n i n g t h a t c a t e g o r y must be weighed a g a i n s t t h e p o t e n t i a l
harm o r i n j u s t i c e l i k e l y t o r e s u l t from r e t e n t i o n .        S i n c e we are
of t h e o p i n i o n t h a t t h e S t a t u t e of Frauds s h o u l d n o t be t o t a l l y
r e p e a l e d it w i l l be n e c e s s a r y t h r o u g h t h e c o u r s e of t h i s Working
Paper t o weigh o r 'lbalancell t h e a d v a n t a g e s and d i s a d v a n t a g e s
a s s o c i a t e d with r e t e n t i o n , f o r each category s e p a r a t e l y .           It is
n e v e r t h e l e s s u s e f u l t o a n a l y s e a t t h i s t i m e t h e g e n e r a l func-
t i o n s which t h e S t a t u t e of Frauds c a n s e r v e t o g e t h e r w i t h t h e
d i s a d v a n t a g e s and c r i t i c i s m s of t h e S t a t u t e . Accordingly we
s e t them f o r t h h e r e .

         Advantages of t h e S t a t u t e of Frauds

         1.     Evidentiary Function

        The main f u n c t i o n which t h e S t a t u t e of Frauds s e r v e d a t
t h e t i m e of i t s e n a c t m e n t w a s t h a t of r e q u i r i n g p a r t i c u l a r l y
c o g e n t e v i d e n c e , s i g n e d documents o r memoranda, as a c o n d i t i o n
p r e c e d e n t t o e n f o r c e a b i l i t y of what were c o n s i d e r e d a t t h a t
time p a r t i c u l a r l y s i g n i f i c a n t t r a n s a c t i o n s . A s we n o t e d i n
Chapter I1 t h e c o n d i t i o n s which j u s t i f i e d t h i s s t r i n g e n t
e v i d e n t i a r y r e q u i r e m e n t ( t h e p r e v a l e n c e of p e r j u r y , j u r o r s
d e c i d i n g cases on t h e b a s i s of p e r s o n a l knowledge, t h e incap-
a c i t y of p a r t i e s t o a n a c t i o n t o t e s t i f y , and t h e a g g r e s s i v e n e s s
of l i t i g a t i o n ) no l o n g e r e x i s t . N e v e r t h e l e s s , it i s a t l e a s t
a r g u a b l e t h a t even t o d a y c e r t a i n i m p o r t a n t t r a n s a c t i o n s should
be r e q u i r e d t o be e v i d e n c e d i n w r i t i n g i n o r d e r t o be e n f o r c e -
able.         I t may v e r y w e l l be t h a t , i n so f a r a s c e r t a i n t y p e s of
t r a n s a c t i o n s a r e concerned, more i n j u s t i c e w i l l occur a s a
r e s u l t of allowing c o n t r a c t s o r t r a n s a c t i o n s which never a c t u a l l y
e x i s t e d t o be f r a u d u l e n t l y proved by p a r o l evidence t h a n w i l l
occur a s a r e s u l t of n o t e n f o r c i n g o t h e r w i s e p e r f e c t l y v a l i d
agreements.         I n o t h e r words, i f it i s thought t h a t t h e f r a u d s
which may occur a s a consequence of allowing proof by p a r o l
evidence more t h a n outweigh t h e i n j u s t i c e which w i l l occur a s a
r e s u l t of n o t e n f o r c i n g l e g i t i m a t e b a r g a i n s t h e n t h e e v i d e n t i a r y
f u n c t i o n of t h e S t a t u t e of Frauds may s t i l l be a j u s t i f i c a t i o n
f o r its retention.


        However, i f t h e e v i d e n t i a r y f u n c t i o n of t h e S t a t u t e of
Frauds i s t o be viewed a s t h e s o l e o r major reason f o r r e t e n t i o n
of a w r i t i n g r e q u i r e m e n t i n r e s p e c t of a p a r t i c u l a r c a t e g o r y we
must f u r t h e r ask how t h a t p a r t i c u l a r c a t e g o r y d i f f e r s from
each s i g n i f i c a n t t r a n s a c t i o n n o t f a l l i n g w i t h i n t h e S t a t u t e .
C h a r a c t e r i s t i c s which might be c o n s i d e r e d i n a d e t e r m i n a t i o n of
whether a p a r t i c u l a r c a t e g o r y m e r i t s a s p e c i a l e v i d e n t i a r y
requirement i n c l u d e t h e pecuniary importance of t h a t c a t e g o r y
(many f i n a n c i a l l y s i g n i f i c a n t t r a n s a c t i o n s such a s s a l e s of
s h a r e s a r e n o t w i t h i n t h e ambit of t h e S t a t u t e of F r a u d s ) , t h e
i n t r i n s i c importance of t h a t c a t e g o r y (e.g.               contracts for the
purchase o r s a l e of a house a r e o f t e n t h e most important con-
t r a c t s i n t o which many p e r s o n s w i l l e n t e r i n t h e course of
t h e i r l i v e s ) and t h e t y p e of i n d i v i d u a l who w i l l be " p r o t e c t e d "
by t h e e v i d e n t i a r y requirement ( i . e . i s t h e p o t e n t i a l defendant
u s u a l l y going t o be a b u s i n e s s e n t i t y w i t h ready a c c e s s t o
l e g a l a d v i c e o r w i l l he o f t e n be a non-business                   entity?).

2.      The C a u t i o n a r y Function

        The c a u t i o n a r y f u n c t i o n which a l e g a l f o r m a l i t y can per-
form h a s been d e s c r i b e d by F u l l e r ,          " C o n s i d e r a t i o n and Form"
( 4 1 Col. L.R. 799, 800):
        A f o r m a l i t y may a l s o perform a c a u t i o n a r y o r
        d e t e r r e n t f u n c t i o n by a c t i n g a s a check a g a i n s t
        inconsiderate action.                  The s e a l i n i t s o r i g i n a l
        form f u l f i l l e d t h i s purpose remarkably w e l l .               The
        a f f i x i n g and i m p r e s s i n g of a wax wafer--symbol i n
        t h e p o p u l a r mind o f l e g a l i s m and weightiness--was
        an e x c e l l e n t d e v i c e f o r inducing t h e circumspec-
        t i v e frame of mind a p p r o p r i a t e i n one p l e d g i n g h i s
        future.          To a less e x t e n t any r e q u i r e m e n t of a
        w r i t i n g , of c o u r s e , s e r v e s t h e same purpose, a s do
        requirements of a t t e s t a t i o n , n o t a r i z a t i o n , e t c .


T h i s c a u t i o n a r y f u n c t i o n was emphasized i n Working Paper No.                          20
o f t h e B.C.      Law Reform Commission, pp.                    148-150,         i n s u p p o r t of
t h e p r o p o s a l of t h a t body t h a t g u a r a n t e e s and i n d e m n i t i e s should
n o t be e n f o r c e a b l e u n l e s s t h e y a r e s e t o u t i n w r i t i n g ( a s opposed
t o being merely evidenced i n w r i t i n g ) .                    I t i s a l s o the underlying
purpose of t h e Guarantees Acknowledgment A c t , R.S.A.                                 1970,
c . 163.       The I n s t i t u t e o f Law Research and Reform i n i t s Report
on t h e Guarantees Acknowledgment A c t , a t p.                          2 commented t h a t
t h e purpose of t h e Act i s ,


        ...        t h e p r e v e n t i o n of f r a u d u l e n t p r a c t i c e s .
        More p a r t i c u l a r l y , t h e Guarantees Acknowledgment
        Act i s d e s i g n e d t o p r o t e c t t h e o r d i n a r y i n d i v i d u a l
        who, through l a c k of e x p e r i e n c e o r u n d e r s t a n d i n g ,
        might o t h e r w i s e f i n d himself s u b j e c t t o onerous
        l i a b i l i t i e s a t law, t h e n a t u r e and e x t e n t of which
        he d i d n o t p r o p e r l y a p p r e c i a t e when he e n t e r e d
        i n t o the undertaking i n question.                       The s t a t u t e
        s e e k s t o p r o v i d e t h i s p r o t e c t i o n by r e q u i r i n g t h a t
        t h e person g i v i n g t h e g u a r a n t e e must a p p e a r b e f o r e
        a n o t a r y p u b l i c and t h a t t h e l a t t e r must s a t i s f y
        himself by e x a m i n a t i o n t h a t t h e g u a r a n t o r is aware
        of t h e c o n t e n t s of t h e g u a r a n t e e and u n d e r s t a n d s it.


        3.       The C h a n n e l l i n s F u n c t i o n


        The c h a n n e l l i n g f u n c t i o n of a f o r m a l i t y is t h a t of d e n o t i n g
i n and of i t s e l f t h a t a n u n d e r t a k i n g i s e n f o r c e a b l e , t h a t
n e g o t i a t i o n s have ended, and t h a t c o n t r a c t u a l i n t e n t i o n i s
c o n c l u s i v e l y presumed.        Fuller,       ( 4 1 Col. L.R.         799, 801) has
d e s c r i b e d t h e c h a n n e l l i n g f u n c t i o n of t h e s e a l :
        The s e a l n o t o n l y i n s u r e s a s a t i s f a c t o r y memorial
        of t h e promise and induces d e l i b e r a t i o n i n t h e
        making of it. I t s e r v e s a l s o t o mark o r s i g n a l i z e
        t h e e n f o r c e a b l e promise; it f u r n i s h e s a s i m p l e
        and e x t e r n a l t e s t of e n f o r c e a b i l i t y .


        I t should be n o t e d t h a t most of t h e w r i t i n g requirements
i n t h e S t a t u t e of Frauds a r e n o t good examples of f o r m a l i t i e s
s e r v i n g a c h a n n e l l i n g f u n c t i o n . For example, s a t i s f y i n g t h e
w r i t i n g requirement of s. 4 of t h e S t a t u t e does n o t provide
". . . a       simple and e x t e r n a l t e s t of e n f o r c e a b i l i t y          ..   .I1   of
t h a t undertaking o r promise.        A l l t h e o t h e r e s s e n t i a l elements
of a simple c o n t r a c t must s t i l l be proved, i . e . c o n s i d e r a t i o n ,
c e r t a i n t y , and i n t e n t i o n t o c r e a t e l e g a l r e l a t i o n s .   A s Fuller
goes on t o say ( a t p. 802):

        The S t a t u t e of Frauds, f o r example, has o n l y a
        n e g a t i v e c a n a l i z a t i o n e f f e c t in t h e s e n s e t h a t it
        i n d i c a t e s a way by which one may be s u r e of 7                     not
        being bound.                n
                                 O the positive side, the outlines
        of t h e channel a r e b l u r r e d because t o o many f a c t o r s ,
        i n c l u d i n g c o n s i d e r a t i o n , remain u n a s s i m i l a t e d i n t o
        t h e form.

B.      Disadvantaaes and C r i t i c i s m s of t h e S t a t u t e of Frauds

        1.     The Act Causes I n j u s t i c e


     Probably t h e most s e r i o u s c r i t i c i s m of t h e S t a t u t e of
Frauds i s t h a t it h a s caused more i n j u s t i c e t h a n it has pre-
vented.        An example of such i n j u s t i c e i s demonstrated by t h e
e f f e c t of an admission of t h e e x i s t e n c e of t h e c o n t r a c t by t h e
p a r t y t o be charged when t h e r e has n o t been compliance with t h e
S t a t u t e . Even i f a d e f e n d a n t admits making t h e c o n t r a c t , t h e
S t a t u t e p r o v i d e s a d e f e n c e . This l e a d s t o r e s u l t s such a s
t h o s e expressed by Lord Campbell i n Sievewright v. ~ r c h i b a l d
 (1871), 17 Q.B. 103, 1 1 9 :
        I r e g r e t t o s a y t h a t t h e view which I t a k e of t h e
        law i n t h i s c a s e compels m e t o come t o t h e con-
        c l u s i o n t h a t t h e defendant is e n t i t l e d t o our
        judgment, a l t h o u g h t h e m e r i t s a r e e n t i r e l y a g a i n s t
        him; a l t h o u g h , b e l i e v i n g t h a t he had broken h i s
        c o n t r a c t , he c o u l d o n l y have defended t h e a c t i o n
        i n t h e hope o f m i t i g a t i n g t h e damages; and a l t h o u g h
        he was n o t aware of t h e o b j e c t i o n on which he now
        r e l i e s , till a f e w days b e f o r e t h e t r i a l .


         While t h e S t a t u t e o f Frauds h a s caused i n j u s t i c e in
i n d i v i d u a l c a s e s by p r o v i d i n g a t e c h n i c a l d e f e n c e t o t h e defen-
d a n t who e n t e r e d i n t o a n o r a l c o n t r a c t w i t h t h e f u l l i n t e n t i o n
o f b e i n g bound by it and who s u b s e q u e n t l y d e c i d e d t o r e n e g e on
h i s c o n t r a c t u a l o b l i g a t i o n s , t h e S t a t u t e h a s a l s o had t h e
f u n c t i o n of p r e v e n t i n g i n d i v i d u a l s from b e i n g bound by a l l e g e d
c o n t r a c t s i n t o which t h e y n e v e r e n t e r e d , o r i n t o which t h e y
entered without s u f f i c i e n t d e l i b e r a t i o n .         I t is a s against
t h e s e e v i d e n t i a r y and c a u t i o n a r y f u n c t i o n s t h a t t h e i n j u s t i c e
c a u s e d by t h e S t a t u t e must be weighed.

        2.       The S t a t u t e Causes Unnecessary L i t i g a t i o n

     The E n g l i s h Law R e v i s i o n Committee has commented ( E n g l i s h
Law Revision Committee R e p o r t , 8 ) :


        Apart from i t s p o l i c y t h e S t a t u t e is in p o i n t of
        language o b s c u r e and i l l - d r a f t e d .            'It i s univer-
        s a l l y a d m i t t e d , ' o b s e r v e d t h e o r i g i n a l e d i t o r of
        S m i t h ' s Leading Cases, ' t h a t no Enactment of t h e
        L e g i s l a t u r e h a s become t h e s u b j e c t of so much
        litigation.'             T h i s c o u l d h a r d l y have been so i f
        i t s t e r m s had been r e a s o n a b l y l u c i d .


       The S t a t u t e o f F r a u d s h a s r e s u l t e d in a mass of l i t i g a t i o n
a s t o whether p a r t i c u l a r c a s e s a r e w i t h i n o r w i t h o u t t h e S t a t u t e .
For example, t h e C e n t u r y D i g e s t , t h e F i r s t D i c e n n i a l and t h e
Second D i c e n n i a l l i s t 10,800 c a s e s on t h e S t a t u t e . T h i s o b v i o u s l y
e n t a i l s a considerable public a s w e l l a s private cost.
                                                                                                  11
        T h i s p a r t i c u l a r c r i t i c i s m must however be p l a c e d i n i t s
proper perspective.          F i r s t , a g r e a t many of t h e s e c a s e s may
have been l i t i g a t e d even had t h e r e been no S t a t u t e of Frauds,
p a r t i c u l a r l y s i n c e most of t h e s e c a s e s must by d e f i n i t i o n have
i n v o l v e d o r a l a g r e e m e n t s o r i n s u f f i c i e n t memoranda i n which
t h e d e f e n d a n t was d i s p u t i n g e i t h e r t h e v e r y e x i s t e n c e of an
agreement, o r else t h e t e r m s a s a l l e g e d by t h e p l a i n t i f f .

        Second, t h e r e i s no way of e s t i m a t i n g how many d i s p u t e s
        -
w e r e n o t l i t i g a t e d , s i m p l y because t h e S t a t u t e of Frauds pro-
v i d e d a complete d e f e n c e .


        F i n a l l y , it may be p o s s i b l e t o r e d u c e l i t i g a t i o n by making
t h e a p p l i c a t i o n of t h e S t a t u t e c l e a r e r .   T h i s l a t t e r reform
would n o t e n t a i l r e p e a l .

        3.      The S t a t u t e i s a P r o d u c t of C o n d i t i o n s Which No
                Longer E x i s t

        A s d i s c u s s e d i n C h a p t e r 1 t h e o r i g i n a l c o n d i t i o n s which
                                                 1
l e d t o t h e enactment no l o n g e r e x i s t . While t h e changes i n
c o n d i t i o n s do n o t r e n d e r t h e e v i d e n t i a r y f u n c t i o n of t h e
S t a t u t e a s compelling a reason f o r r e t a i n i n g t h e S t a t u t e , t h i s
p a r t i c u l a r f u n c t i o n i s s t i l l of some use. Also, t h e c a u t i o n a r y
and c h a n n e l l i n g f u n c t i o n s of t h e S t a t u t e , which w e r e n o t a t a l l
t h e r e a s o n s f o r i t s enactment may j u s t i f y t h e r e t e n t i o n of a t
l e a s t some of i t s p r o v i s i o n s .

        4.      The S t a t u t e i s n o t i n Conformity w i t h A c t u a l P r a c t i c e


        I t can be a r g u e d t h a t t h e S t a t u t e s h o u l d be r e p e a l e d s i n c e
it p r e s c r i b e s a method of c o n t r a c t i n g which i s n o t in c o n f o r m i t y
w i t h t h e way b u s i n e s s o r t r a n s a c t i o n s of t h a t s o r t a r e normally
carried.         I f t h e r e i s a d i v e r g e n c e between a c t u a l p r a c t i c e and
t h e l e g a l r e q u i r e m e n t of w r i t i n g set f o r t h i n t h e S t a t u t e , t h e n
t h i s i n i t s e l f would be j u s t i f i c a t i o n enough f o r r e p e a l .
However, t h i s c r i t i c i s m i s l i k e l y more warranted in r e s p e c t of
some p r o v i s i o n s of t h e S t a t u t e t h a n of o t h e r s .     For example,
            e
w h i l e w have no e m p i r i c a l d a t a t o prove t h i s it would seem
l i k e l y t h a t t h e v a s t m a j o r i t y of conveyances of land, c o n t r a c t s
f o r t h e s a l e of l a n d , g u a r a n t e e s , and e x p r e s s c r e a t i o n s of
t r u s t s a r e in f a c t in w r i t i n g .      O t h e o t h e r hand it would seem
                                                      n
t h a t many c o n t r a c t s n o t t o be performed w i t h i n a y e a r , o f t e n
being c o n t r a c t s of s e r v i c e , a r e n o t i n w r i t i n g .

        5.      The S t a t u t e Renders C o n t r a c t s Unenforceable But Does
                Not A f f e c t T h e i r V a l i d i t y

        The E n g l i s h Law Revision Committee in i t s c r i t i c i s m of t h e
S t a t u t e argued (E.L.R.C.,            Report, a t 7 ) :

        The s e c t i o n does n o t reduce c o n t r a c t s which do n o t
        comply w i t h it t o mere n u l l i t i e s , b u t merely makes
        them u n e n f o r c e a b l e by a c t i o n . For o t h e r purposes
        they preserve t h e i r efficacy.

The B r i t i s h Columbia Law Reform Commission p o i n t s o u t (B.C.L.R.C.
Working Paper, 89:

        The s t a t u t e engenders s i t u a t i o n s in which o r a l agree-
        ments a r e u n e n f o r c e a b l e , o s t e n s i b l y because of t h e
        dangers of f r a u d and p e r j u r y , and y e t in which, not-
        w i t h s t a n d i n g t h e same danger of f r a u d and per j u r y ,
        t h e y may be used a s d e f e n c e s i n a c t i o n s t o r e c o v e r
        d e p o s i t s p a i d under a l l e g e d agreements, t o e x p l a i n
        a c t s of p a s t performance i n o r d e r t o e n f o r c e agree-
        ments, o r even ( i n t h e e i g h t e e n t h c e n t u r y ) t o s e r v e
        a s t h e j u s t i f i c a t i o n f o r imprisoning d e f e n d a n t s f o r
        p e r j u r y when t h e y denied agreements.

     While t h e f a c t t h a t c o n t r a c t s w i t h i n t h e S t a t u t e a r e
merely unenforceable and n o t void may seem t o l e a d t o r a t h e r
anomalous r e s u l t s , it should be p o i n t e d o u t t h a t it a l s o pro-
v i d e s f o r a c e r t a i n d e g r e e of f l e x i b i l i t y .   For example it i s
d i f f i c u l t t o s e e how t h e d o c t r i n e of p a r t performance could
                                                                                             13
e v e r have a r i s e n i f f a i l u r e t o s a t i s f y t h e S t a t u t e rendered t h e
c o n t r a c t void.   Because t h e S t a t u t e merely rendered the c o n t r a c t
unenforceable u n t i l c e r t a i n e v i d e n t i a r y r e q u i r e m e n t s were m e t it
i s n o t t o o d i f f i c u l t t o understand how C o u r t s of E q u i t y would
e v e n t u a l l y r e c o g n i z e an a l t e r n a t e form of evidence, a c t s of
p a r t performance, a s being e q u a l l y p r o b a t i v e .            Likewise t h e
f a c t t h a t an u n e n f o r c e a b l e c o n t r a c t can be r a i s e d by way of
defence l e a d s t o t h e p e r f e c t l y s e n s i b l e r e s u l t t h a t an agree-
ment executed by b o t h p a r t i e s cannot be undone.                        I f t h e con-
t r a c t were v o i d , t h e p a r t i e s could presumably demand back any
c o n s i d e r a t i o n t r a n s f e r r e d a s being conveyed o r p a i d under a void
c o n t r a c t . The a b i l i t y t o r a i s e an u n e n f o r c e a b l e c o n t r a c t a s a
defence t o an a c t i o n f o r r e c o v e r y of a d e p o s i t p a i d under an
e n f o r c e a b l e c o n t r a c t does n o t r e a l l y c r e a t e an i n j u s t i c e i f
o n l y because t h e d e p o s i t can be r e t a i n e d o n l y i f t h a t p a r t y i s
w i l l i n g t o perform.
                                      CHAPTER I V

                               O
                    CONTRACTS F R THE SALE OF, OR ANY
                                                   AD
                      INTEREST I N OR CONCERNING, L N

       Section 4 of t h e S t a t u t e of Frauds r e a d s :

       ...        no a c t i o n s h a l l be brought whereby t o charge
       any Executor o r Administrator upon any s p e c i a l
       promise t o answer damages o u t of h i s own E s t a t e o r
       whereby t o charge t h e Defendant upon any s p e c i a l
       promise t o answer f o r t h e debt, d e f a u l t o r miscar-
       r i a g e s of another person o r t o charge any person
       upon any agreement made upon c o n s i d e r a t i o n of
       Marriage o r upon any C o n t r a c t o r S a l e of Lands,
       Tenements o r Hereditaments o r any I n t e r e s t in o r
       concerning them o r upon any Agreement t h a t i s not
       t o be performed w i t h i n t h e space of one year from
       t h e making t h e r e o f u n l e s s t h e Agreement upon which
       such a c t i o n s h a l l be brought o r some Memorandum
       o r Note t h e r e o f s h a l l be i n w r i t i n g and signed by
       t h e p a r t y t o be charged t h e r e w i t h o r some o t h e r
       person t h e r e u n t o by him l a w f u l l y a u t h o r i z e d .

       S e c t i o n 4 , which w e r e f e r t o a s t h e "Contracts s e c t i o n , "
has been t h e most l i t i g a t e d of a l l t h e s e c t i o n s i n t h e S t a t u t e
of Frauds.       I t r e f e r s t o f i v e c a t e g o r i e s of c o n t r a c t s :


       1) C o n t r a c t s t o Charge Executors o r Administrators.

       2)    C o n t r a c t s t o Answer f o r t h e Debt, D e f a u l t , o r
             Miscarriage of Another (Guarantees)

       3)    C o n t r a c t s made upon c o n s i d e r a t i o n of marriage.

       4)    C o n t r a c t s o r s a l e of lands      . . . or       any I n t e r e s t
             i n o r concerning them.

       5)    C o n t r a c t s n o t t o be performed w i t h i n one year.
                                                                                                    15
          Of t h e s e f i v e c a t e g o r i e s t h e most l i t i g a t e d and t h e most
c o n t r o v e r s i a l i n t e r m s o f p o t e n t i a l law r e f o r m i s c o n t r a c t s
r e l a t i n g t o land. A c c o r d i n g l y , i n t h i s c h a p t e r we s h a l l d i s -
c u s s and e v a l u a t e t h e p r e s e n t s t a t e of t h e law of t h i s p a r t i -
c u l a r c a t e g o r y of c o n t r a c t s .   I n Chapter V we d i s c u s s t h e
r e l a t e d (though d i f f e r e n t ) c a t e g o r i e s of C r e a t i o n s and Convey-
a n c e s of I n t e r e s t s i n Land ( s e c t i o n s 1 and 3 of t h e S t a t u t e ) .
A c o n s i d e r a t i o n of t h e o t h e r 4 c o n t r a c t c a t e g o r i e s i s d e f e r r e d
u n t i l C h a p t e r s I X , X , X I , and X I 1     .
        W e s h a l l b e g i n o u r c o n s i d e r a t i o n of c o n t r a c t s c o n c e r n i n g
a n interest in l a n d by a n a l y z i n g t h e c a t e g o r y under t h e
f o l l o w i n g headings:

        A)      I n t e r p r e t a t i o n of t h e p h r a s e 'I.   ..     no a c t i o n
                s h a l l be b r o u g h t    ..    .I1  ( l e g a l i m p l i c a t i o n s of
                unenforceability).

        B)      Requirements f o r a S u f f i c i e n t W r i t i n g o r Note o r
                Memorandum.

        C)     J u d i c i a l i n t e r p r e t a t i o n of " C o n t r a c t o r S a l e of
               Lands Tenements o r Hereditaments o r any I n t e r e s t
               i n o r c o n c e r n i n g them."


        D)     Other r e l i e f i n t h e e v e n t of non-compliance w i t h
               t h e S t a t u t e ( t h i s i n c l u d e s a d i s c u s s i o n of t h e
               d o c t r i n e of p a r t performance)           .
        E)     E v a l u a t i o n o f t h e Law and P r o p o s a l s f o r Reform.

         Headings A and B a r e r e l e v a n t a s w e l l t o t h e o t h e r f o u r
c a t e g o r i e s of c o n t r a c t s mentioned in t h e s e c t i o n . Headings
C and D and E a r e of c o u r s e r e l e v a n t o n l y t o t h i s p a r t i c u l a r
category.
16
A.     "No Action s h a l l be Broughtt1

     While a t one t i m e in t h e long h i s t o r y of t h e S t a t u t e of
Frauds t h e phrase 'I.           ..
                             no a c t i o n s h a l l be brought.             I'        ...
was i n t e r p r e t e d a s r e n d e r i n g t h e c o n t r a c t void.--Carrington            v.
~ o o t s(1837), 2 M & W 249 (Exch. )--it i s now w e l l s e t t l e d
t h a t t h e e f f e c t of non-compliance with t h e S t a t u t e is t o render
t h e c o n t r a c t unenforceable--Leroux v. Brown (1852), 1 2 C.B. 801
(Common P l e a s ) ; Maddison v. Alderson (1883) , 8 App. Cas. 467.

       There a r e s e v e r a l i m p l i c a t i o n s a r i s i n g from t h e f a c t t h a t
a c o n t r a c t may be merely unenforceable and n o t void.                            F i r s t , the
c o n t r a c t may be used a s a defence i n an action--Miles v. New                         -
Zealand Alford E s t a t e (1886), 32 Ch. D. 266.             Thus, i f pursuant
t o an o r a l c o n t r a c t A allows B t o e n t e r upon h i s land and d i g
f o r g r a v e l , B, should he be sued in t r e s p a s s , can r a i s e t h e
o r a l agreement by way of defence.                      n
                                                         O t h e o t h e r hand i f A were
t o t u r n B and h i s machinery o f f t h e land B could not sue A i n
t r e s p a s s , s i n c e t h i s would amount t o enforcement of t h e c o n t r a c t ,
a l b e i t i n d i r e c t l y - - T r e i t e l The Law of C o n t r a c t , 3rd ed. 1 4 4 ,
145. Likewise an a t t e m p t by a purchaser, who i s i n d e f a u l t
under an o r a l agreement, t o recover h i s d e p o s i t can be met by
t h e s u c c e s s f u l defence t h a t t h e monies a r e held pursuant t o a
v a l i d agreement--Thomas            v. Brown (1876), 1 Q.B.D.                   714; S w i t z e r ' s
Investments Ltd. v. Burn ( 1 9 6 4 ) , 49 W.W.R.                    on nick end am v.
                                                                       627;
Leanse ( 1 9 2 3 ) , 39 T.L.R.        445.    However, i f t h e vendor r e p u d i a t e s
t h e money i s r e c o v e r a b l e on t h e ground of t o t a l f a i l u r e of



        A second i m p l i c a t i o n i s t h a t t h e agreement, while unen-
f o r c e a b l e , i s s u f f i c i e n t c o n s i d e r a t i o n t o support a n e g o t i a b l e
instrument.            Thus, i n an a c t i o n on a cheque given a s a d e p o s i t
on o r a l agreement, t h e defence of no c o n s i d e r a t i o n (which i s
normally a v a i l a b l e a s between immediate p a r t i e s t o a n e g o t i a b l e
i n s t r u m e n t ) w i l l be of no a v a i l t o t h e purchaser f o r t h e simple
r e a s o n t h a t t h e agreement, though u n e n f o r c e a b l e , i s s t i l l v a l i d
and t h u s c o n s t i t u t e s c o n s i d e r a t i o n - - J o n e s v. J o n e s (1840) ,
6 M.    & W.                        -
                84 (Exch. ) ; Low v. Fry (1935) 152 L.T.R.                          585.

          F i n a l l y t h e f a c t t h a t t h e agreement i s v a l i d b u t unen-
f o r c e a b l e means t h a t e v i d e n c e s u f f i c i e n t f o r a c o u r t of common
law o r e q u i t y may arise a t a p o i n t in t i m e a f t e r t h e f o r m a t i o n
o f t h e c o n t r a c t , such t h a t t h e agreement t h e n becomes e n f o r c e a b l e .
A t common law t h e e v i d e n c e would have t o be a s u f f i c i e n t n o t e
o r memorandum ( d i s c u s s e d i n f r a ) ; a t e q u i t y t h i s e v i d e n c e would
have t o m e e t t h e r e q u i r e m e n t s of t h e d o c t r i n e of p a r t p e r f o r -
mance.      While t h e c o n t r a c t might become e n f o r c e a b l e o n l y a t t h e
l a t e r d a t e , t h e e x i s t e n c e o f t h e c o n t r a c t d a t e s back t o t h e t i m e
of i t s a c t u a l formation.            Had f a i l u r e t o s a t i s f y t h e r e q u i r e -
ments of t h e S t a t u t e of Frauds been j u d i c i a l l y t r e a t e d a s
r e n d e r i n g t h e c o n t r a c t v o i d , a l a t e r n o t e o r memorandum o r
acts of p a r t performance would be s i g n i f i c a n t o n l y t o t h e e x t e n t
t h a t t h e y c o n s t i t u t e d t h e f o r m a t i o n of a new c o n t r a c t i n com-
p l i a n c e w i t h t h e S t a t u t e o r t h e e q u i t a b l e d o c t r i n e of p a r t
performance.              T h i s might be t h e c a s e some of t h e t i m e b u t
t h e r e a r e c l e a r l y many memoranda which would n o t in t h e m s e l v e s
c o n s t i t u t e f o r m a t i o n of a new c o n t r a c t , e.g., a n o t e r e f e r r i n g
t o t h e p r i o r agreement b u t r e p u d i a t i n g it. Likewise it would
be d i f f i c u l t t o prove from most a c t s of p a r t performance a
"new" o f f e r and a c c e p t a n c e .

        A s we n o t e d e a r l i e r i n o u r d i s c u s s i o n of t h e d i s a d v a n t a g e s
of t h e S t a t u t e ( s u p r a Ch. 1 1 , t h e a p p a r e n t l y anomalous conse-
                                        1 )
quences of mere u n e n f o r c e a b i l i t y has been a major criticism
of t h e S t a t u t e . W e have a l s o commented t h a t a t t h e same t i m e
it p e r m i t s a c e r t a i n d e g r e e of f l e x i b i l i t y in t h e o p e r a t i o n of
t h e S t a t u t e , p a r t i c u l a r l y by a l l o w i n g i n l a t e r e v i d e n c e of t h e
v a l i d , but i n i t i a l l y unenforceable c o n t r a c t .
18
B.       The Requirement of a S u f f i c i e n t Note o r Memorandum

         The i s s u e of whether a given n o t e o r memorandum has s a t i s -
f i e d t h e e v i d e n t i a r y r e q u i r e m e n t s of s e c t i o n 4 of t h e S t a t u t e
                                                                                e
h a s been t h e s o u r c e of a f l o o d of l i t i g a t i o n . W d i s c u s s l a t e r
i n t h i s c h a p t e r some p o s s i b l e approaches t o law reform i n t h i s
a r e a . A t t h i s t i m e , we set o u t , w i t h o u t comment, t h e p r e s e n t
s t a t e of t h e law.

         1.     Time by Which t h e Note o r Memorandum Must be i n
                Existence

         The p h r a s e   ". . . no a c t i o n     s h a l l be brought.        . . ." has
been held t o mean t h a t t h e w r i t i n g must be i n e x i s t e n c e p r i o r
t o t h e commencement of t h e action--Lucas           -        v. Dixon (1889) , 22
Q.B.D. 357 ( C . A . ) .   n
                         O t h e same p r i n c i p l e t h e p l e a d i n g s of a
defendant w i l l be i n s u f f i c i e n t - - J a c k s o n v. Oglander (1865) ,
2 II.      465 (V. Ch. )
         & M.                      .
                                 I t i s however s u f f i c i e n t i f t h e n o t e
o r memorandum i s i n e x i s t e n c e a t t h e time when t h e p a r t y
r e l y i n g on it i s joined t o t h e a c t i o n - - F a r r ,      Smith     &   Co. v.
Messers Ltd.,              [1928] 1 K.B.      397.

         2.     Form of Note o r Memorandum Required

         A s e a r l y a s 1683 it was decided t h a t a w r i t i n g need n o t
be i n any p a r t i c u l a r form t o s a t i s f y t h e Statute--Moore                v.
H a r t 1 Vern. I11 201 (Ch.). Thus w r i t i n g s i n l e t t e r s [see f o r
example T h i r k e l l v. Cambi, [1919] 2 K.B. 590; Maybury v. O'Brien
( 1 9 1 1 ) , 25 O.L.R.     229, r e v e r s e d on t h e f a c t s , 26 O.L.R.            628
(C.A.) I and i n w i l l s [ s e e - Hoyle,
                                       Re                   [18931 1 Ch. 841 have been
h e l d t o be c a p a b l e of c o n s t i t u t i n g s u f f i c i e n t n o t e s o r memoranda.
The n o t e o r memorandum need n o t have been w r i t t e n w i t h t h e i n t e n -
t i o n of s a t i s f y i n g t h e S t a t u t e . A s long a s it s u f f i c i e n t l y
e v i d e n c e s t h e e x i s t e n c e of a c o n t r a c t , t h e n o t e o r memorandum
w i l l s u f f i c e , even i f it amounts t o a r e p u d i a t i o n of t h e
c o n t r a c t ; T h i r k e l l v. Cambi.        However, a l e t t e r showing a
d i s p u t e between t h e p a r t i e s a s t o t h e t e r m s [Archer v.            Baynes
( 1 8 5 0 ) , 5 Exch.       16251 or denying t h e v e r y e x i s t e n c e of t h e
c o n t r a c t w i l l n o t be s u f f i c i e n t .


         Thus i n T i v e r t o n E s t a t e s Ltd. v. Wearwell Ltd.,               [I9751 Ch.
146, t h e E n g l i s h C o u r t of Appeal h e l d t h a t a " s u b j e c t t o c o n t r a c t "
document, even i f it c o u l d be s a i d t o e v i d e n c e a l l t h e m a t e r i a l
t e r m s of a n a l l e g e d c o n t r a c t , was i n s u f f i c i e n t on t h e ground
t h a t it d i d n o t a l s o e v i d e n c e t h e f a c t t h a t t h e r e was a f i n a l l y
concluded agreement [ s e e a l s o Tweddell v. Henderson,                           [I975 I
2 A l l E.R.       1096 (Ch.) 1.


         3.       C o n t e n t s of t h e N o t e o r Memorandum


         Williams,    in h i s book The S t a t e of F r a u d s S e c t i o n IV,
s t a t e s , a t 55:  "      ...
                                t o s a t i s f y t h e S t a t u t e t h e memorandum
must set f o r t h - of t h e c o n t r a c t , and a s a c o n t r a c t e x i s t s
                      all
only i n i t s various t e r m s ,            t h e memorandum must t h e r e f o r e d i s -
close a l l t h e t e r m s o f t h e c o n t r a c t . "

         The more p r e v a l e n t view, however,            i s t h a t t h e memorandum
need o n l y d i s c l o s e a l l t h e m a t e r i a l terms.       T h i s less s t r i c t
s t a n d a r d i s s t a t e d i n C h e s h i r e and F i f o o t , Law of C o n t r a c t ,
8 t h ed.,      1972, a t 185; Anson, Law of C o n t r a c t , 23rd ed.,                   1969,
a t 75; T r e i t e l , The Law o f C o n t r a c t , 3rd e d . ,         1970, a t 140;
Halsbury' s Laws of England, v o l . 8 (3rd ed.                      ,   1954) a t 100; and
C.E.D.        ( W e s t e r n ) , Vol.   5 (2nd ed.      1958) a t 103, 104.          In
McKenzie v. Walsh ( 1 9 2 1 ) , 61 S.C.R.                  312, S i r Louis Davies
C.J.C.        s t a t e d a t 313:


         I have r e a c h e d t h e c o n c l u s i o n t h a t t h e memorandum
         o r r e c e i p t is s u f f i c i e n t .   That it must c o n t a i n a l l
         t h e e s s e n t i a l t e r m s of t h e c o n t r a c t and must show
         t h a t t h e p a r t i e s have a g r e e d t o t h o s e terms i s
         conceded by b o t h s i d e s .            That it does s o , I conclude.
         The e s s e n t i a l t e r m s a r e t h e p a r t i e s , t h e p r o p e r t y
         and t h e p r i c e .
       Besides t h e p a r t i e s , p r o p e r t y and t h e p r i c e , it i s c l e a r
t h a t , depending on t h e c i r c u m s t a n c e s of a c a s e , o t h e r terms
c a n be material--Chapman              v. Kopitoski,          [I9721 6 W.W.R.              525.
Thus in Tweddle v. Henderson t h e payment of t h e purchase p r i c e
i n s t a g e s was c o n s i d e r e d m a t e r i a l and i n H u t t g e s v. Verner
(1975), 1 0 N.B.R.           533 (S.C.Q.B.D.)           t h e r e s e r v a t i o n of a l i f e
                                                                                         a
i n t e r e s t by t h e d e f e n d a n t s e l l e r i n a c o n t r a c t of s a l e w s
h e l d t o be m a t e r i a l .


          The i s s u e of whether a given m a t e r i a l term i s i n f a c t
i n c l u d e d i n t h e memorandum i s complicated by t h e p r i n c i p l e
t h a t it i s s u f f i c i e n t i f t h e term i s d i s c l o s e d by r e a s o n a b l e
inference--Caddick v. Skidmore (1857), 2 DeG. & J. 52 (Ch. ) --
and t h a t p a r o l e v i d e n c e i s a d m i s s i b l e f o r t h e purposes of
e x p l a n a t i o n , though n o t of adding o r v a r y i n g terms--Williams,
59. P r e c i s e l y what c o n s t i t u t e s r e a s o n a b l e i n f e r e n c e and t h e
p o i n t a t which e x p l a n a t i o n c e a s e s and a d d i t i o n s o r v a r i a t i o n s
begin a r e p o i n t s of g r e a t d i f f i c u l t y .     A number of c a s e s
i l l u s t r a t e these distinctions.                 -
                                                    I n C a r r v. Lynch, [1900] 1
Ch. 613 a memorandum of a l e a s e s t a t i n g " i n c o n s i d e r a t i o n of
you having t h i s day p a i d me t h e sum of 50h" w a s held t o be
s u f f i c i e n t i d e n t i f i c a t i o n of t h e l e s s e e , when he proved t h a t
he had paid t h e 50h on t h a t day.                  I n R o s s i t e r v. M i l l e r    (1878),
3 App. Cas. 1124 p a r o l evidence was a d m i s s i b l e t o i d e n t i f y
" p r o p r i e t o r . I' However in P o t t e r v. D u f f i e l d (1874) , L.R. 18
Eq.   4 p a r o l e v i d e n c e was i n a d m i s s i b l e t o i d e n t i f y "vendor.     "
I n P l a n t v. Bourne, [I8971 2 Ch. 281 p a r o l evidence was
a d m i s s i b l e t o i d e n t i f y "twenty-four a c r e s of land at        ...
Totomslow       ...
                 .It;    b u t i n Caddick v. Skidmore a r e c e i p t f o r
money paid t o a p a r t y "on account of h i s s h a r e i n t h e
T i v i d a l e minett could n o t be e x p l a i n e d by p a r o l evidence.

        Even i f a m a t e r i a l t e r m i s o m i t t e d t h e r e i s a u t h o r i t y
f o r t h e p r o p o s i t i o n t h a t i f t h a t term i s f o r t h e s o l e b e n e f i t
of t h e p l a i n t i f f (i.e., n o t f o r t h e j o i n t b e n e f i t of p l a i n t i f f
                                                                                                           21
and d e f e n d a n t ) the o m i s s i o n w i l l n o t p r e c l u d e t h e p l a i n t i f f
from e n f o r c i n g t h e c o n t r a c t a s long a s he waives t h a t t e r m - -
North v. Loomes, [I9191 1 Ch. 378.

         4.     The R e q u i s i t e S i g n a t u r e


         S i g n a t u r e , i n t h e normal use of t h e word, i m p l i e s t h a t a
p a r t y h a s w r i t t e n h i s own name a t t h e end of a document a s a
means of a u t h e n t i c a t i n g it. However, i n t h e c a s e of t h e
S t a t u t e of Frauds, t h e word h a s been g i v e n a more l i b e r a l
interpretation.                F i r s t , i n i t i a l s w i l l be s u f f i c i e n t - - C h i c h e s t e r
v. Cobb ( 1 8 6 6 ) , 1 4 L.T. 433.       Second, t h e s i g n a t u r e may be i n
a n y p a r t of t h e document, n o t n e c e s s a r i l y a t t h e hottom--
D u r r e l l v. Evans ( 1 8 6 2 ) , 1 H. & C. 174; Evans v. Hoare, [I8921
1 Q.B.        593.     T h i r d , t h e s i g n a t u r e may be p r i n t e d - - S c h n e i d e r        v.
N o r r i s ( 1 8 1 4 ) , 2 M. & S. 286.                However, it i s n e c e s s a r y t h a t
t h e " s i g n a t u r e " a u t h e n t i c a t e t h e whole document. A s T r e i t e l
p o i n t s o u t ( T r e i t e l ) , 3 r d ed.,        141):


         These r u l e s a r e l a x , b u t a document i s n o t s i g n e d
         by a p a r t y m e r e l y because h i s name o c c u r s somewhere
         w i t h i n it: t h e s i g n a t u r e must a u t h e n t i c a t e t h e
         whole document.           Thus i f a memorandum i s headed
         ' A r t i c l e s of Agreement between A and B ' and con-
         cluded ' a s w i t n e s s o u r hands               ...
                                                               .' t h e p a r t i e s
         must a c t u a l l y s u b s c r i b e : t h e mention of t h e i r
         names a t t h e b e g i n n i n g i s c l e a r l y n o t i n t e n d e d a s
         a signature.


         I t i s s u f f i c i e n t i f t h e n o t e o r memorandum i s s i g n e d by
t h e a g e n t of t h e p a r t y t o be charged, " l a w f u l l y a u t h o r i z e d . "
Unlike c e r t a i n o t h e r s e c t i o n s of t h e S t a t u t e , s e c t i o n 4 does
n o t r e q u i r e t h e a g e n t t o be a u t h o r i z e d i n w r i t i n g - - C o l e s v.
T r e c o t h i c k ( 1 8 0 4 ) , 9 V e s . Jun. 234 (Ch.).             Whether o r n o t an
a g e n t i s l a w f u l l y a u t h o r i z e d i s a q u e s t i o n of f a c t i n each
c a s e ; however, it i s n o t n e c e s s a r y t h a t t h e a g e n t be a u t h o r i z e d
f o r the e x p r e s s purpose of s a t i s f y i n g t h e S t a t u t e - - D a n i e l s v.
Trefusus,            [I9141 1 Ch. 788.               H e may s i g n h i s own name o r t h a t
of h i s principal--Graham              v. Mosson ( 1 8 3 9 ) , 5 Bing.             (N.C.)      603--
and he may be a g e n t f o r b o t h p a r t i e s - - S i e v e w r i g h t v. A r c h i b a l d
( 1 8 5 1 ) , 17 Q.B. 103. However t h e p l a i n t i f f c a n n o t be t h e
a g e n t f o r t h e defendant--Sharman v. Brandt ( 1 8 7 1 ) , L.R. 6 Q.B.
720.     F i n a l l y , t h e same p r i n c i p l e s a s t o " a u t h e n t i c a t i o n " of
signatures applies t o agents a s w e l l a s t o principals--
           Roe,
Wallace v. - [1903] 1 1 - R e 32-


        F i n a l l y it s h o u l d be emphasized t h a t t h e s i g n a t u r e s of
both p a r t i e s a r e n o t required.            I t i s o n l y t h e " p a r t y t o be
c h a r g e d , " i.e., the d e f e n d a n t , t h a t must s i g n . Thus it i s
p o s s i b l e f o r a p l a i n t i f f , who h a s n o t s i g n e d , t o e n f o r c e a
c o n t r a c t a g a i n s t a d e f e n d a n t who has.

        5.      J o i n d e r of Documents

        I n c i r c u m s t a n c e s where a s i n g l e document d o e s n o t d i s c l o s e
a l l t h e m a t e r i a l t e r m s it may be p o s s i b l e t o j o i n t o g e t h e r two
o r more documents i n o r d e r t o produce a s u f f i c i e n t memorandum.
A d i s t i n c t i o n s h o u l d be made between t h e j o i n i n g of documents,
b o t h of which a r e s i g n e d , and t h e j o i n i n g of s i g n e d and unsigned
documents.


          I n t h e j o i n i n g of s i g n e d and unsigned documents t h e two
must be connected i n some way and t h e a u t h e n t i c a t i n g i n f l u e n c e
of t h e s i g n a t u r e must e x t e n d t o t h e unsigned document.     It
h a s been h e l d t h a t t h e s i g n e d document must come i n t o e x i s t e n c e
i n p o i n t of t i m e a f t e r t h e unsigned document--Turney v.
H a r t l e y (1848), 3 N e w P r a c t . Cas. 96--but it is now s u f f i c i e n t
i f t h e documents come i n t o b e i n g more o r less contemporaneously,
r e g a r d l e s s of order--Timrnins         v. Moreland S t r e e t P r o p e r t y Co.,
 [I9571 3 A l l E.R. 265.


     There i s some d i s p u t e a b o u t what s o r t of c o n n e c t i o n
between t h e t m documents must be e s t a b l i s h e d , and a b o u t t h e
                                                                                          23
a d m i s s i b i l i t y of p a r o l evidence t o e s t a b l i s h t h e i r connection.
There a r e a p p a r e n t l y two t e s t s . The s t r i c t e r t e s t was set o u t
by Baggallay L. J. i n Long v. M i l l a r (1879), 4 C.P.D.                       450, 454:


       The t r u e p r i n c i p l e i s t h a t t h e r e must e x i s t a
       w r i t i n g t o which t h e document signed by t h e p a r t y
       t o be charged can r e f e r , but t h a t t h i s w r i t i n g
       may be i d e n t i f i e d by v e r b a l evidence. "

This was expanded by R u s s e l l J. in Stokes v. Whichar,                         [I9201
1 Ch. 4 1 1 :


       ...         i f you can s p e l l o u t of t h e document a r e f e r -
       ence i n it t o some o t h e r t r a n s a c t i o n , you a r e a t
       l i b e r t y t o g i v e e v i d e n c e a s t o what t h a t o t h e r
       t r a n s a c t i o n i s , and i f t h a t o t h e r t r a n s a c t i o n con-
       t a i n s a l l t h e t e r m s i n w r i t i n g , t h e n you g e t a
       s u f f i c i e n t memorandum w i t h i n t h e S t a t u t e by r e a d i n g
       t h e two t o g e t h e r .

     This s t r i c t t e s t , t h e n , r e q u i r e s t h a t t h e r e be some r e f e r -
ence i n t h e signed document t o t h e unsigned document.

       The more l i b e r a l t e s t , sometimes r e f e r r e d t o a s t h e " s i d e
by s i d e " t e s t was set f o r t h by B r a m m e l l J. i n Long v. M i l l a r
a t 454:


       ...         it becomes a p p a r e n t t h a t t h e agreement
       a l l u d e d t o i s t h e agreement signed by t h e p l a i n t i f f ,
       so soon a s t h e documents a r e placed s i d e by s i d e .
       The agreement r e f e r r e d t o may be i d e n t i f i e d by
       p a r o l evidence.


T h i s was extended i n Olver v. Hunting ( 1 8 9 0 ) , 4 4 Ch. D. 205
where Kekewich J. s t a t e d :      "Whenever p a r o l evidence i s r e q u i r e d
t o connect two w r i t t e n documents t o g e t h e r then t h a t p a r o l
evidence i s a d m i s s i b l e . "

       I t should be noted t h a t both t h e s t r i c t and l i b e r a l tests
r e q u i r e some c o n n e c t i o n t o be shown by o t h e r t h a n p a r o l evidence.
I n t h e l a t t e r t e s t t h e c o n n e c t i o n must be o b v i o u s from p l a c i n g
t h e two documents s i d e by s i d e .                I n t h e former test t h e r e must
be a r e f e r e n c e , e x p r e s s o r i m p l i e d ,   i n t h e s i g n e d document.              If
t h e c o n n e c t i o n can o n l y be drawn by p a r o l e v i d e n c e then t h a t
w i l l be i n s u f f i c i e n t (see T r e i t e l , 1 4 3 ) .

        If a p l a i n t i f f a t t e m p t s t o j o i n two s i g n e d documents it
i s n o t n e c e s s a r y t h a t t h e s i g n a t u r e on one document authen-
t i c a t e s the other.         According t o Williams, S t a t u t e of Frauds
S e c t i o n I V , 142:


        Where two s i g n e d documents r e f e r t o t h e same s u b j e c t
        matter, t h e y may be connected t o g e t h e r t o form a
        w r i t i n g under t h e S t a t u t e , p a r o l e v i d e n c e being
        a d m i s s i b l e t o i d e n t i f y t h e s u b j e c t of r e f e r e n c e .


H e r e l i e s upon A l l e n v.       Bennet ( 1 8 1 0 ) , 3 Taunt.             169; ~ e r l a n d e r
     -
v. Codd ( 1 8 2 3 ) , Turn.          & R.     352; Studds v. Watson                  ( 1 8 8 4 ) , 28
Ch. D.      305; b u t a d m i t s t h a t P o t t e r v. P e t e r s ( 1 8 9 5 ) , 64 L . J .
Ch. 357 i s t o t h e c o n t r a r y .


C.      Meaning of " C o n t r a c t o r S a l e of Lands, Tenements o r
        Hereditaments o r any I n t e r e s t i n o r c o n c e r n i n g them.                   I'




        W e c o n s i d e r i n t h i s s e c t i o n t h e scope of a p p l i c a t i o n of
s e c t i o n 4 i n s o f a r a s it r e l a t e s t o c o n t r a c t s c o n c e r n i n g l a n d .
The wording i n t h e S t a t u t e r e f e r s t o :              I'   . . . any     Contract or
S a l e of Lands Tenements o r Hereditaments o r any I n t e r e s t i n
o r concerning them."                The a p p l i c a b l e E n g l i s h p r o v i s i o n ,   found
i n s. 4 0 ( 1 ) of t h e Law of P r o p e r t y Act, 1925, 15 Geo.                          5, c. 20,
r e f e r s to:     "   . . . any      contract f o r the s a l e or other dis-
p o s i t i o n o f l a n d , o r any i n t e r e s t in land.            "   The a p p l i c a b l e
p r o v i s i o n in B r i t i s h Columbia found i n s. 2 (1) of t h e B.C.
S t a t u t e of F r a u d s r e f e r s t o :     "   . . . agreement           c o n c e r n i n g an
i n t e r e s t i n land.    "
       I n c e r t a i n i n s t a n c e s t h e scope of a p p l i c a t i o n of t h e
S t a t u t e i s obvious, i n o t h e r i n s t a n c e s t h e a p p l i c a t i o n i s less
obvious. A s t h e B.C. Law Reform Commission p o i n t s o u t in i t s
Working Paper, a t p. 4:

       Over t h r e e hundred y e a r s of j u d i c i a l i n t e r p r e t a t i o n
       have l e f t u s w i t h an i m p r e c i s e n o t i o n , t o say t h e
       l e a s t , of what agreements w i l l be c o n s t r u e d a s
       concerning an i n t e r e s t i n land.               To be s u r e , a d i s -
       p o s i t i o n of t h e f e e s i m p l e , an agreement t o convey
       an e q u i t y of redemption, and an agreement t o g r a n t
       a l e a s e , come w i t h i n t h e j u d i c i a l d e f i n i t i o n o f
       i n t e r e s t s i n land.      The same may be s a i d of a g r e e -
       ments c r e a t i n g easements and ' p r o f i t s 2 p r e n d r e ' i n
       land. O t h e o t h e r hand, m e r e l i c e n s e s have been
                       n
       e n f o r c e d on t h e b a s i s of par01 agreements s i n c e a
       l i c e n s e , n o t b e i n g an i n t e r e s t i n l a n d , f a l l s out-
       s i d e t h e S t a t u t e of Frauds.

           D i f f i c u l t i e s have a r i s e n , however, when t h e
       c o u r t s have been asked t o c o n s i d e r agreements which,
       i n t h e n a t u r e of t h i n g s , a r e more ambiguous.               For
       example, because an agreement must, i n t h e words of
       t h e E n g l i s h Law of P r o p e r t y A c t , be ' f o r t h e s a l e
       o r o t h e r d i s p o s i t i o n of an i n t e r e s t i n l a n d ' , agree-
       ments f o r o t h e r p u r p o s e s , n o t w i t h s t a n d i n g a p e r i p -
       h e r a l involvement of an i n t e r e s t i n l a n d , have been
       h e l d t o f a l l o u t s i d e t h e s t a t u t e . Thus c o n t r a c t s t o
       form a p a r t n e r s h i p , o r t o r e c e i v e s h a r e s i n a company,
       each of which i n v o l v e d l a n d , have been excluded.

       W e now r e v i e w s p e c i f i c problem a r e a s which have r e c e i v e d
judicial consideration.

       1.      Produce of t h e S o i l

       A major problem a r e a i s whether a s a l e of p r o d u c t s of
t h e s o i l i s a s a l e of goods o r a s a l e of an i n t e r e s t in land.
Such p r o d u c t s may be d i v i d e d i n t o two classes, f r u c t u s
i n d u s t r i a l e s and f r u c t u s n a t u r a l e s .

       F r u c t u s i n d u s t r i a l e s have been d e f i n e d a s ' c o r n and
       o t h e r growths of t h e e a r t h produced n o t spontaneously,
       b u t by l a b o u r and i n d u s t r y ' ; f r u c t u s n a t u r a l e s a s t h e
       spontaneous p r o d u c t of t h e s o i l , such a s g r a s s and
       even p l a n t e d t r e e s , where ' t h e l a b o u r employed i n
       t h e i r p l a n t i n g b e a r s so small a p r o p o r t i o n t o t h e i r
       n a t u r a l growth.'

                                 [Cheshire & F i f o o t , Law of C o n t r a c t ,
                                                               - -
                                 183 ( 8 t h ed., 19721, r e l v i n s on
                                 ~arshall    v. Green -(1875), 1 C.P.D.           35
                                 p e r Lord oler ridge C J. I
                                 -                               .
F r u c t u s i n d u s t r i a l e s have always been regarded a s goods w h i l e ,
a t common law, t h e s t a t u s of f r u c t u s n a t u r a l e s depended upon
t h e time f o r severance.               I f t h e y were t o remain a t t a c h e d t o
t h e s o i l f o r some time so t h a t t h e buyer would b e n e f i t from
t h e continued a t t a c h m e n t , t h e y were c o n s i d e r e d t o be land--
Cheshire and F i f o o t , Law of C o n t r a c t , 183.


       The s i t u a t i o n h a s been complicated by t h e f a c t t h a t
        (
s. 2 (1) h ) (ii)of t h e S a l e of Goods Act d e f i n e s "goods" a s
including:


       emblements, i n d u s t r i a l growing c r o p s and t h i n g s
       a t t a c h e d t o o r forming p a r t of t h e land t h a t a r e
       agreed t o be severed b e f o r e s a l e o r under t h e
       c o n t r a c t of s a l e .

I n Cheshire & F i f o o t , Law of C o n t r a c t , 184 ( 8 t h Ed. 1 9 7 2 ) , t h e
e f f e c t of t h i s p r o v i s i o n i s d i s c u s s e d and it i s p o i n t e d out
t h a t i n most c a s e s t h e p u r c h a s e r buys t h e produce of t h e s o i l
i n t e n d i n g a t some t i m e t o e f f e c t i t s severance so t h a t t h e
severance w i l l t a k e p l a c e under t h e c o n t r a c t of s a l e . A s a
r e s u l t , f r u c t u s n a t u r a l e s should be c o n s i d e r e d in most c a s e s
a s goods. However i n Saunders v. P i l c h e r , [ I 9 4 9 1 2 ~ l E.R.              l
1097, S i n g l e t o n L . J . s t a t e d t h a t t h e d e f i n i t i o n of "goods" i n
t h e S a l e of Goods Act a p p l i e d only t o t h a t Act. Thus f r u c t u s
n a t u r a l e s may w e l l be c o n s i d e r e d goods f o r t h e purposes of
t h e S a l e of Goods Act and land f o r t h e purpose of s. 4 of t h e
S t a t u t e of Frauds.
     This c o n c l u s i o n could l e a d t o anomalous r e s u l t s .   Section
7 of t h e S a l e of Goods Act ( d i s c u s s e d i n more d e t a i l i n Ch. V I ,
i n f r a ) c o n t a i n s an e v i d e n t i a r y p r o v i s i o n r e q u i r i n g e i t h e r a
signed n o t e o r memorandum, acceptance and r e c e i p t of t h e goods,
o r "something given i n e a r n e s t t o bind t h e c o n t r a c t or i n p a r t
payment.       ...I1 i n order t o render the c o n t r a c t enforceable.
Because of t h e l a t t e r two means of complying w i t h s. 7 of t h e
S a l e of Goods Act, it i s p o s s i b l e f o r t h e r e t o e x i s t a s i t u a t i o n
i n which t h e e v i d e n t i a r y p r o v i s i o n s of t h e S a l e of Goods Act
have been s a t i s f i e d , and i n which t h e r e i s non-compliance with
s. 4 of t h e S t a t u t e of Frauds.      However, s i n c e an agreement
coming w i t h i n both s t a t u t e s must comply w i t h both--DiCastri,
Canadian Law of Vendor and Purchaser 2 4 , 25 (1st ed., 1968)                                            --
t h e agreement would s t i l l be unenforceable.

        To complicate matters even f u r t h e r t h e r e a r e c a s e s i n
which t h e c o u r t h a s n o t looked t o t h e p h y s i c a l n a t u r e of what
was being bought b u t h a s focused i t s a t t e n t i o n on t h e "sub-
s t a n c e of t h e agreement. " A s t h e B.C. Law Reform Commission
p o i n t s o u t i n i t s Working Paper, a t pp.                   11, 1 2 :


        ...         t h e r e a r e c a s e s i n which t h e c o u r t c o n s i d e r s
        t h e agreement a s a whole, and i n so doing may con-
        s t r u e it a s c r e a t i n g merely a l i c e n s e o r permit
        allowing A t o go o n t o B' s land and t a k e timber
        away.         Since a l i c e n s e i s n o t g e n e r a l l y c o n s i d e r e d
        t o be an i n t e r e s t i n l a n d , A could e n f o r c e t h e
        agreement n o t w i t h s t a n d i n g i t s par01 n a t u r e .         Con-
        v e r s e l y , however, t h e r e a r e c a s e s which hold such
        agreements t o be analogous t o p r o f i t s a p r e n d r e ,
        o r l e a s e s , both of which a r e i n t e r e s t s i n land.
        S i m i l a r arguments have been r a i s e d s u c c e s s f u l l y
        w i t h r e g a r d t o d i s p o s i t i o n s of m i n e r a l s and
        growing crops.

           The r e s u l t i n any s p e c i f i c c a s e a p p e a r s t o r e s t
        on such f a c t o r s as t h e l e n g t h of time b e f o r e t h e
        o b j e c t s a r e t o be severed from t h e l a n d , t h e e x t e n t
        of e x c l u s i v e p o s s e s s i o n g r a n t e d under t h e agreement,
        and t h e r e l e v a n t p r o v i s i o n s of any s t a t u t e a t i s s u e .
                Fixtures

          The g e n e r a l r u l e i s t h a t f i x t u r e s a r e i n t e r e s t s in l a n d ,
p a s s i n g w i t h t h e l a n d when it i s t r a n s f e r r e d .      Agreements t o
s e v e r f i x t u r e s have t h u s been h e l d t o be c o n t r a c t s concerning
a n i n t e r e s t i n land--Lee v. Risdon (1816) , 7 Taunt. 188. An
                                  7




e x c e p t i o n t o t h i s r u l e a p p a r e n t l y a r i s e s i n t h e c a s e of a n
agreement t o d i s p o s e o f a t e n a n t ' s f i x t u r e s .               -
                                                                              I n Lee v. G a s k e l l
 ( 1 8 7 6 ) , 1 Q.B.C. 700 it was h e l d t h a t a s a l e of a t e n a n t ' s
f i x t u r e s was n e i t h e r a s a l e of goods ( w h i l e s t i l l a t t a c h e d t o
t h e l a n d ) nor was it a s a l e of an i n t e r e s t i n l a n d s i n c e t h e
t e n a n t had t h e r i g h t t o s e v e r them d u r i n g t h e tenancy.

        3.      S a l e s of M i n e r a l s and O i l s

         Whether c o n t r a c t s c o n c e r n i n g m i n e r a l s , o i l s , n a t u r a l g a s
and t h e l i k e f a l l w i t h i n s. 4 o f t h e S t a t u t e i s a n i s s u e which
c a n n o t be d e c i d e d d e f i n i t i v e l y . A s t h e B.C. Law Reform
Commission p o i n t s o u t i n i t s Working Paper, a t pp. 9-10 :

        Agreements concerned w i t h t h i n g s which a r e n o t merely
        i n t e r e s t s i n l a n d , b u t " t h e land i t s e l f " can b e con-
        s t r u e d a s c o n t r a c t s f o r t h e s a l e of aoods.     I n Benia-
        m i n t s S a l e o f Goods it i s argued t h a t t h e s a l e of
        m i n e r a l s t h a t have been e x t r a c t e d from t h e l a n d , o r
        a n agreement t o s e l l m i n e r a l s which t h e l a n d owner
        i s t o mine a r e , b o t h a t common law and under t h e S a l e
        of Goods A c t , c o n t r a c t s f o r t h e s a l e of goods.
              Other c a s e s , however, s u g g e s t t h a t such agreements
        come w i t h i n t h e S t a t u t e of Frauds, e i t h e r a s c o n t r a c t s
        i n r e s p e c t of an i n t e r e s t i n l a n d , o r a s c o n t r a c t s i n
        r e s p e c t of t h e l a n d i t s e l f .   ...
              The r e a s o n s u n d e r l y i n g t h e i n c o n s i s t e n c i e s e v i d e n t
        i n t h i s a r e a a r e obscure.            I t may b e , where agreements
        w e r e construed a s concerning i n t e r e s t s i n land, t h a t
        t h e c o u r t was i n f a c t c o n c e n t r a t i n g n o t on t h e p h y s i c a l
        n a t u r e of t h e o i l , m i n e r a l s , o r g a s r e f e r r e d t o in t h e
        c o n t r a c t , b u t on t h e 'package of r i g h t s ' t r a n s f e r r e d
        thereunder.
        Finally,       it s h o u l d be n o t e d t h a t i n Emerald Resources Ltd.
v.   S t e r l i n g O i l P r o p e r t i e s Management Ltd.           ( 1 9 6 9 ) , 3 D.L.R.      (3d)
630 ( A l t a . S.C.,       A.D.),      a f f i r m e d ( 1 9 7 1 ) , 15 D.L.R.       (3d) 256
 (S.C.C.)      it w a s h e l d t h a t a r o y a l t y agreement on o i l from l a n d
f e l l o u t s i d e t h e S t a t u t e of Frauds.


        4.      Agreements About P r o c e e d s From S a l e s of Land


        Agreements f o r t h e d i v i s i o n of p r o c e e d s from t h e s a l e of
l a n d have been c o n s i d e r e d i n Canada a s n o t f a l l i n g w i t h s. 4
of t h e Statute--Harris              v. Lindeborg,           [I9311 S.C .R.          235;
S t u a r t v. Mott,       (1893) 23 S.C.R.            153.      I n England t h e p o s i t i o n
might be d i f f e r e n t .       I n a n o b i t e r d i c t u m J e n k i n s L. J. i n
Cooper v. C r i t c h l e y ,      [I9551 1 A l l E.R.           520, 524,        stated:


        ...        t h e r e is, t o m mind, l i t t l e d o u b t t h a t
                                          y
        b e f o r e t h e Law o f P r o p e r t y A c t , 1925, an i n t e r e s t
        i n t h e p r o c e e d s t o a r i s e from a s a l e of l a n d
        would n o t w i t h s t a n d i n g t h e e q u i t a b l e d o c t r i n e of
        c o n v e r s i o n have ranked a s an i n t e r e s t i n l a n d f o r
        t h e p u r p o s e s of s. 4 of t h e A c t of 1677.


        5.      C o l l a t e r a l Aareements


        Sometimes a n a g r e e m e n t i n i s s u e i s c o n s i d e r e d c o l l a t e r a l
t o and i n d e p e n d e n t of a n agreement r e l a t i n g t o l a n d , and
hence n o t w i t h i n t h e S t a t u t e .       An example of an a p p l i c a t i o n of
t h i s p r i n c i p l e c a n be found in Canadian G e n e r a l S e c u r i t e s Co.
v. George ( 1 9 1 8 ) , 43 D.L.R.              20 (Ont. S.C.).,             r e v e r s e d on o t h e r
grounds,       ( 1 9 1 9 ) , 59 S.C.R.       641.      I n t h a t c a s e t h e r e was an
agreement f o r t h e s a l e o f l a n d from t h e p l a i n t i f f s t o t h e
d e f e n d a n t s w i t h a n u n d e r t a k i n g by t h e p l a i n t i f f s t o r e s e l l
f o r t h e defendants.            The l a t t e r u n d e r t a k i n g w a s c o n s i d e r e d
a s c o l l a t e r a l t o t h e c o n t r a c t of sale, and s i n c e it was an
agreement t o s e l l , a s opposed t o a n agreement f o r s a l e , d i d
not f a l l within the S t a t u t e .
       6.     A ~ r e e m e n t St o S e l l o r Purchase Land

       Agreements under which a p a r t y a g r e e s t o buy o r s e l l land
from o r t o a t h i r d p a r t y have g e n e r a l l y been t r e a t e d a s con-
t r a c t s f o r s e r v i c e s , t h u s n o t f a l l i n g w i t h i n s. 4 of t h e
S t a t u t e of Frauds--Archibald v. G o l d s t e i n ( 1 8 8 4 ) , 1 Man. L.R.
45; Horsey v. Graham ( 1 8 6 9 ) , L.R. 5 C.P. 9; Ross v. S c o t t
(1875), 22 G r .      29.

       Homver s. 2 2 o f t h e Real E s t a t e s Agents' L i c e n s i n g A c t ,
R.S.A.   1970, c. 311, p r o v i d e s :

       No a c t i o n s h a l l be brought t o c h a r g e a p e r s o n by
       commission o r o t h e r w i s e f o r s e r v i c e s r e n d e r e d in
       c o n n e c t i o n w i t h t h e s a l e o f l a n d , tenements o r
       hereditaments, o r an i n t e r e s t t h e r e i n , unless

       (a)    t h e c o n t r a c t upon which r e c o v e r y i s sought
              in t h e a c t i o n o r some n o t e o r memorandum
              t h e r e o f i s i n w r i t i n g s i g n e d by t h e p a r t y
              t o be charged o r by h i s a g e n t l a w f u l l y
              authorized i n writing, or
       (b)    t h e p e r s o n sought t o be charged
               (1) h a s a s a r e s u l t of t h e s e r v i c e s of an
                   a g e n t employed by him f o r t h e purpose
                   e f f e c t e d a s a l e o r l e a s e of l a n d s ,
                   tenements and h e r e d i t a m e n t s o r any
                   i n t e r e s t t h e r e i n , and
                      h a s e i t h e r executed a t r a n s f e r o r l e a s e
                      s i g n e d by a l l n e c e s s a r y p a r t i e s and
                      d e l i v e r e d it t o t h e p u r c h a s e r , o r has
                      e x e c u t e d an agreement of s a l e of l a n d s ,
                      tenements and h e r e d i t a m e n t s o r an
                      i n t e r e s t t h e r e i n , s i g n e d by a l l neces-
                      s a r y p a r t i e s , e n t i t l i n g t h e purchaser
                      t o p o s s e s s i o n of t h e l a n d s , tenements
                      and h e r e d i t a m e n t s o r any i n t e r e s t t h e r e i n ,
                      a s s p e c i f i e d in t h e agreement, and has
                      d e l i v e r e d t h e agreement t o t h e p u r c h a s e r .


The e f f e c t of t h i s s e c t i o n i s s i m i l a r t o t h a t of s. 4 of t h e
S t a t u t e of Frauds i n s o f a r a s it merely r e n d e r s c o n t r a c t s n o t
                                                                                                      31
complying w i t h it unenforceable.                     The memorandum requirement
i s , however, s l i g h t l y more s t r i n g e n t i n t h a t a s i g n a t u r e by
t h e a g e n t of t h e p a r t y t o be charged w i l l n o t s u f f i c e u n l e s s
t h a t agent was " l a w f u l l y a u t h o r i z e d i n w r i t i n g . "      The s e c t i o n
a l s o p r o v i d e s an a l t e r n a t e method of compliance i n s u b s e c t i o n
(b)   .
D.        R e l i e f A v a i l a b l e Where There Has Been Non-Compliance


          1.    Doctrine of P a r t Performance

          I t was n o t long a f t e r t h e enactment of t h e S t a t u t e of
Frauds t h a t c o u r t s of e q u i t y when faced with t h e obvious
i n j u s t i c e a r i s i n g i n a t l e a s t some c a s e s a s a r e s u l t of
adhering t o t h e r i g i d r e q u i r e m e n t s of t h e s t a t u t e , would
e n f o r c e t h e c o n t r a c t n o t w i t h s t a n d i n g non-compliance w i t h t h e
statute.         This i n t e r v e n t i o n by t h e c o u r t s of e q u i t y and t h e
"circumstances" which must be proved t o a l l o w e q u i t y t o d i s -
pense w i t h t h e r e q u i r e m e n t of w r i t i n g has become known a s t h e
d o c t r i n e of p a r t performance.            The e a r l i e s t r e p o r t e d c a s e was
Butcher v. S t a p e l y ( 1 6 8 6 ) , 1 Vern 363.                I n i t s modern sense
t h e d o c t r i n e was e s t a b l i s h e d i n t h e n i n e t e e n t h c e n t u r y c a s e
of Maddison v. Alderson (1883), 8 App. Cas. 467.


          I t i s i m p o r t a n t t o review, a t l e a s t b r i e f l y t h e t h e o r e -
t i c a l f o u n d a t i o n s of t h e d o c t r i n e . A s t h e B.C. Law Reform
Commission has noted i n i t s Working Paper a t p. 17,

          The b a s i s f o r t h e i n t e r v e n t i o n ...      is essential
          t o an a p p r e c i a t i o n of i t s f u n c t i o n , and a n a s s e s s -
          ment of i t s adequacy i n p r e v e n t i n g abuses of t h e
          Statute.

          There a r e two t h e o r e t i c a l bases of t h e d o c t r i n e .            The
more orthodox approach t o t h e d o c t r i n e and t h e one t h a t has
r e c e i v e d j u d i c i a l a c c e p t a n c e i n Canada i s t h a t of r e g a r d i n g
it a s a t h e o r y of what we c a l l " a l t e r n a t e evidence." In this
sense a c t s of p a r t performance a r e viewed a s being evidence
s u f f i c i e n t l y c o g e n t t o a l l o w a c o u r t of e q u i t y t o e n f o r c e t h e
c o n t r a c t even though it could n o t be e n f o r c e d a t common law
because of non-compliance w i t h t h e S t a t u t e .                   P r e c i s e l y what
a c t s , and what c i r c u m s t a n c e s must be proved w i l l be d i s c u s s e d
             e
i n f r a . W n o t e h e r e , however, t h a t even r e g a r d i n g a c t s of
p a r t performance a s b e i n g merely an a l t e r n a t e type of evidence,
t h e r e has been d i s p u t e a s t o what a r e s u f f i c i e n t a c t s of p a r t
performance such a s t o a l l o w i n par01 evidence.                           That i s ,
must t h e a c t s prove t h e p r e c i s e t e r m s of t h e a l l e g e d c o n t r a c t ,
                                    -
o r only t h a t t h e r e i s a contract?


        The second t h e o r e t i c a l b a s i s of t h e d o c t r i n e emphasizes
t h e a c t s of p a r t performance n o t so much f o r t h e i r e v i d e n t i a r y
v a l u e , b u t a s r a i s i n g e q u i t i e s i n t h e p l a i n t i f f which r e n d e r
it u n j u s t n o t t o e n f o r c e t h e c o n t r a c t . T h i s approach t o t h e
d o c t r i n e r e c e n t l y h a s r e c e i v e d j u d i c i a l a p p r o v a l i n England.
I n Steadman v. Steadman,                [I9741 3 W.L.R.           56 ( H . L . ) ,   Lord
Simon s t a t e d , a t p.       80:

        I f t h e p l a i n t i f f has so performed h i s o b l i g a t i o n s
        under t h e c o n t r a c t t h a t it would be unconscionable
        f o r t h e d e f e n d a n t t o p l e a d t h e s t a t u t e , it i s
        immaterial whether o r n o t t h e p l a i n t i f f ' s a c t s
        prove t h e c o n t r a c t .    ...
     I n g e n e r a l t e r m s , t h e a c t s of p a r t performance must have
been done by t h e p a r t y a s s e r t i n g t h e c o n t r a c t , with t h e
knowledge o r a c q u i e s c e n c e of t h e o t h e r p a r t y i n pursuance of
t h e t e r m s of t h e c o n t r a c t . However, t h e n a t u r e of t h e a c t s
r e q u i r e d has changed c o n s i d e r a b l y , a t l e a s t in England, s i n c e
t h e nineteenth century.          The c l a s s i c q u o t a t i o n i s t h a t of Lord
Selbourne L.C.          i n Maddison v. Alderson ( 1 8 8 3 ) , 8 App. Cas.
467, 479:
        A l l t h e a u t h o r i t i e s shew t h a t t h e a c t s r e l i e d
        upon a s p a r t performance must be u n e q u i v o c a l l y ,
        and i n t h e i r own n a t u r e , r e f e r a b l e t o some such
        agreement a s t h a t a l l e g e d .


A s i n t e r p r e t e d f o r a b o u t 80 y e a r s by t h e c o u r t s i n England t h e
d o c t r i n e was a p p l i e d v e r y narrowly.      Not o n l y d i d t h e a c t s
have t o r e f e r t o t h e l a n d i n q u e s t i o n , b u t a s was s t a t e d by
Fry L. J. in Fry on S p e c i f i c Performance 276, 277 ( 6 t h ed. )
1921:


        ...      t h e a c t s of p a r t performance must be such
        a s n o t o n l y t o be r e f e r a b l e t o a c o n t r a c t such
        a s t h a t a l l e g e d , b u t t o be r e f e r a b l e t o no o t h e r
        title.


The s t r i c t n e s s of t h e t e s t i s i l l u s t r a t e d by t h e f a c t s of
Maddison v. Alderson.      I n t h a t c a s e a housekeeper who had
served h e r employer f o r many y e a r s w i t h o u t wages a l l e g e d an
o r a l promise t o l e a v e h e r t h e farm.             I t was h e l d t h a t her
c o n t i n u i n g s e r v i c e was n o t a s u f f i c i e n t a c t of p a r t p e r f o r -
mance s i n c e it w a s n o t u n e q u i v o c a l l y r e f e r a b l e t o some such
c o n t r a c t a s t h a t a l l e g e d . A s Lord Selbourne L.C. s t a t e d a t
p. 481 i n r e f e r r i n g t o t h e continued s e r v i c e , " I t was e x p l i c -
a b l e , without supposing any such new c o n t r a c t , a s e a s i l y a s t h e
continuance of a t e n a n t i n p o s s e s s i o n a f t e r t h e e x p i r a t i o n of a
lease."         I n i t i a l l y t h e n , t h e a c t s of p a r t performance served a
c l e a r evidentiary function.


            y
          B 1962 t h i s r a t h e r s t r i n g e n t t e s t had become somewhat
l i b e r a l i z e d . I n Kingswood E s t a t e Co. Ltd. v. Anderson [I9621
3 A l l E.R.     593, Upjohn L. J. s t a t e d , a t p.             604:

        The t r u e r u l e i s , i n m view, s t a t e d in F r
                                       y
        S p e c i f i c Performance : "The t r u e p r i n c i p e       +=
        however, of t h e o p e r a t i o n of a c t s of p a r t p e r f o r -
        mance seems o n l y t o r e q u i r e t h a t t h e a c t s i n
        q u e s t i o n be such a s must be r e f e r r e d t o some
        c o n t r a c t , and may be r e f e r r e d t o t h e a l l e g e d one:
       t h a t t h e y prove t h e e x i s t e n c e of some c o n t r a c t ,
       and a r e c o n s i s t e n t w i t h t h e c o n t r a c t a l l e g e d .


T h i s t e s t was adopted i n Wakeham v. Mackenzie,                      [I9681 1 W.L.R.
1175, 1181. I t i s u s e f u l t o c o n t r a s t t h i s c a s e w i t h Maddison
v. Alderson.    I n Wakeham v. Mackenzie t h e d e f e n d a n t had
promised t h e p l a i n t i f f h i s house i f she would move in and
t a k e c a r e of him.    She d i d s o , and a p p l y i n g t h e l i b e r a l t e s t ,
t h e c o u r t found s u f f i c i e n t a c t s of p a r t performance.       While
t h e c a s e c a n be d i s t i n g u i s h e d from Maddison v. Alderson on
t h e f a c t s (in t h e l a t t e r c a s e t h e r e was a mere c o n t i n u a t i o n
of s e r v i c e , whereas i n Wakeham she moved i n t o t h e house i n
r e l i a n c e on t h e promise) T r e i t e l in T r e i t e l , The Law of
C o n t r a c t 3rd ed.,    147 r e g a r d s Wakeham v. Mackenzie a s r e p r e -
senting a      It.  . . a more l a x approach t o t h e d o c t r i n e of p a r t
performance . . . t h e c o u r t s have become b o l d e r in t h e a p p l i -
c a t i o n of t h e d o c t r i n e . . . Even t h i s l i b e r a l t e s t i s
                                            .I1


c o n s i s t e n t w i t h t h e n o t i o n of t h e d o c t r i n e being b a s i c a l l y
e v i d e n t i a r y i n n a t u r e ; t h e a c t s under t h e l i b e r a l t e s t , however,
need n o t "unequivocally r e f e r " t o t h e c o n t r a c t in q u e s t i o n , but
must prove some c o n t r a c t and be c o n s i s t e n t with t h e one a l l e g e d .


         Steadman v. Steadman, [1974] 3 W.L.R.                      56 (H.L.) marks a
r a d i c a l d e p a r t u r e from even t h e l i b e r a l t e s t set f o r t h i n
Wakeham v. Mackenzie.           I n t h a t c a s e , t h e p a r t i e s , who were
husband and w i f e , e n t e r e d i n t o a c o n t r a c t whereby t h e husband
                                                                        u
would pay lOOh i n r e s p e c t of a r r e a r s of maintenance and a s m
of 1,500h i n c o n s i d e r a t i o n of t h e w i f e conveying her i n t e r e s t
i n t h e house. The w i f e agreed t o a d i s c h a r g e of t h e mainten-
ance o r d e r . The husband p a i d t h e B100 and t h e husband1s
s o l i c i t o r s s e n t t h e t r a n s f e r deeds t o t h e wife, who r e f u s e d t o
complete. The husband l a t e r sought t o s e t up t h e agreement f o r
sale in defence t o t h e w i f e ' s a p p l i c a t i o n in t h e county c o u r t .
The c o u r t found s u f f i c i e n t a c t s of p a r t performance.
          The e f f e c t of t h i s d e c i s i o n was commented on i n a
c r i t i c a l n o t e by H.W.R.    Wade i n 90 L.Q.R.      433, 436:


       Now t h a t t h e t e x t b o o k s must be r e w r i t t e n , what
       a r e t h e y t o s a y ? I t seems t h a t p a r t performance
       i s t o be based m e r e l y upon e q u i t i e s r e s u l t i n g
       from -g e s t a e s u b s e q u e n t t o and a r i s i n g o u t of
                 res
       the contract..          ..      Lord Reid s a i d t h a t " t h e r u l e
       must be t h a t you t a k e t h e whole c i r c u m s t a n c e s ,
       l e a v i n g a s i d e t h e e v i d e n c e a b o u t t h e o r a l con-
       t r a c t , t o see whether it i s proved t h a t t h e a c t s
       r e l i e d on w e r e done i n r e l i a n c e on a c o n t r a c t :
       t h a t w i l l be proved i f it i s shown t o be more
       probable than n o t . "               There seems t o be no need
       f o r t h e s e c i r c u m s t a n c e s t o p o i n t t o any c o n t r a c t
       a b o u t l a n d , s t i l l less a b o u t any p a r t i c u l a r l a n d :
       f o r t h e payment o f & l o 0 of a r r e a r s of maintenance
       under an o b l i g a t i o n a l r e a d y e x i s t i n g i n d e p e n d e n t l y
       of any l a n d , can c l e a r l y have no such c h a r a c t e r .
       O r a l s t a t e m e n t s made t o t h e c o u r t i n m a t r i m o n i a l
       p r o c e e d i n g s w e r e a p p a r e n t l y r e g a r d e d a s p a r t of
       t h e res g e s t a e .       But of a l l t h e s e n o v e l t i e s t h e
       most s u r p r l s l n g must be t h e o p i n i o n of a b a r e
       m a j o r i t y ( n o t i n c l u d i n g Lord Salmon) t h a t t h e
       mere s e n d i n g by t h e p l a i n t i f f of a deed of t r a n s f e r
       f o r t h e s i g n a t u r e by t h e d e f e n d a n t might be p a r t
       performance.             I f a p a r t y t o an u n e n f o r c e a b l e con-
       t r a c t can make it e n f o r c e a b l e by h i s own u n i l a t e r a l
       a c t , w i t h o u t any a s s e n t by t h e d e f e n d a n t , t h e
       s t a t u t e is indeed j u d i c i a l l y repealed.

         While t h e E n g l i s h c o u r t s have been g i v i n g a n i n c r e a s i n g l y
l i b e r a l i n t e r p r e t a t i o n t o t h e d o c t r i n e of p a r t performance,
Canadian c o u r t s have adhered t o t h e s t r i c t e r t e s t .                In
Dealman v. Guarantv T r u s t Co. of Canada & C o n s t a n t i n e a u .
                -        - -             ---
                                          -     -



[1954] 3 D.L.R.          785 (S.C.C.)         C a r t w r i g h t J. s t a t e d , a t 793:

        ...        it i s o n l y a f t e r such a c t s u n e q u i v o c a l l y
       r e f e r a b l e i n t h e i r own n a t u r e t o some d e a l i n g
       w i t h t h e l a n d which i s a l l e g e d t o have been t h e
       s u b j e c t of t h e agreement sued upon have been
       proved t h a t e v i d e n c e of t h e o r a l agreement becomes
       a d m i s s i b l e f o r t h e purpose of e x p l a i n i n g t h o s e
       acts.         I t i s f o r t h i s r e a s o n t h a t a payment of
       purchase money a l o n e can never be a s u f f i c i e n t a c t
       of performance w i t h i n t h e r u l e .
         T h i s s a m e s t r i c t t e s t was a p p l i e d i n Thompson v. Guaranty
T r u s t Co. of Canada ( 1 9 7 4 ) , 39 D.L.R.               (3d) 408 (S.C.C.).   In
t h e r e c e n t A l b e r t a c a s e of Toornbs v. M u e l l e r ( 1 9 7 4 ) , 47 D.L.R.
(3d) 709 (S.C.T.D.)           , McDonald       J.,    a f t e r r e v i e w i n g t h e law,
assumed, w i t h o u t d e c i d i n g , t h a t t h e narrower i n t e r p r e t a t i o n of
t h e d o c t r i n e o f p a r t performance, a p p l i e d i n A l b e r t a . He
r e l i e d i n p a r t upon t h e cases of - v. Wilson (1969) , 69
                                                  Erb
W.W.R.                                                         -
            126 (Sask. Q . B . ) ; M c G i l l i v r a y v. Shaw ( 1 9 6 3 ) , 39 D.L.R.
 (2d) 660 ( A l t a . S.C., A.D.) ; and Brownscombe v. p u b l i c T r u s t e e
of A l b e r t a , [1969] S.C.R. 658. Applying t h e narrow test,
McDonald J. found t h e a c t s done by t h e p l a i n t i f f t o be s u f f i -
c i e n t t o c o n s t i t u t e p a r t performance , b u t s p e c i f i c performance
was r e f u s e d on t h e ground t h a t t h e p l a i n t i f f had n o t shown he
w a s w i l l i n g and a b l e t o c a r r y o u t h i s o b l i g a t i o n s . On a p p e a l ,
t h e d e c i s i o n w a s r e v e r s e d w i t h o u t r e a s o n s [1975] 3 W.W.R.   96
 (A.D.)--see         e d i t o r ' s n o t e , [I9751 5 W.W.R.           520.


        I n s h o r t t h e law i n Canada a p p e a r s t o be t h a t :

        (a)     t h e a c t s of p a r t performance must r e l a t e
                t o t h e land i n question,


        (b)     such a c t s must be u n e q u i v o c a l l y r e f e r a b l e
                t o a c o n t r a c t i n r e l a t i o n t o the lands,

        (c)    p a r t payment o r even f u l l payment w i l l n o t
               of i t s e l f be a s u f f i c i e n t a c t of p a r t
                performance ,

        (d)     t h e d e f e n d a n t must have a c q u i e s c e d i n o r had
                knowledge o f t h e a c t s of p a r t performance,

        (el     a c t s done by t h e d e f e n d a n t w i l l n o t s u f f i c e
                a s a c t s o f p a r t performance--see Robertson
                V.   C o l w e l l ( 1 9 3 2 ) , 5 M.P.R.    451, 459.
          There i s some q u e s t i o n a s t o what types of c o n t r a c t s
t h e d o c t r i n e of p a r t performance a p p l i e s .    I n B r i t a i n v.
R o s s i t e r (1879), 1 Q.B.D.
                              1             123 it was held t h a t it only
a p p l i e d t o s a l e s of i n t e r e s t s i n land. The more commonly
accepted p o s i t i o n , however, i s t h a t e s t a b l i s h e d in McManus v.
Cooke (1887), 35 Ch. D. 681, 697 that t h e d o c t r i n e " a p p l i e s
t o a l l c a s e s i n which a Court of Equity would e n t e r t a i n a
s u i t f o r s p e c i f i c performance i f t h e a l l e g e d c o n t r a c t had
been i n w r i t i n g . " According t o Halsburyl s [36 Halsburyl s
Laws of England 267-271 (3rd ed., 1 9 6 1 ) l t h i s would exclude,
i n t e r a l i a , c o n t r a c t s r e q u i r i n g t h e continued s u p e r v i s i o n
of t h e c o u r t s , c o n t r a c t s f o r personal work o r s e r v i c e and
c o n t r a c t s lacking m u t u a l i t y .

          One f i n a l a r e a of controversy involves t h e q u e s t i o n of
whether t h e d o c t r i n e of p a r t performance a p p l i e s t o support
an a c t i o n f o r damages when s p e c i f i c performance i s not
a v a i l a b l e . This q u e s t i o n a r i s e s because p r i o r t o 1858 t h e
Court of Chancery c o u l d n o t award damages i n s u b s t i t u t i o n o f ,
o r i n a d d i t i o n t o , s p e c i f i c performance.      y
                                                              B t h e Chancery
Amendment Act (Lord C a i r n s 1 ~ c t )            (1858) 21-22 Vict., c. 27,
s 2, it was provided t h a t :
 .


        I n a l l c a s e s i n which t h e Court of Chancery has
        j u r i s d i c t i o n t o e n t e r t a i n an a p p l i c a t i o n f o r an
        i n j u n c t i o n a g a i n s t a breach of any covenant,
        c o n t r a c t , o r agreement, o r a g a i n s t t h e commission
        o r continuance of any wrongful a c t , o r f o r t h e
        s p e c i f i c performance of any covenant, c o n t r a c t ,
        o r agreement, it s h a l l be lawful f o r t h e same
        c o u r t , i f it s h a l l t h i n k f i t , t o award damages t o
        t h e p a r t y i n j u r e d , e i t h e r i n a d d i t i o n t o o r in
        s u b s t i t u t i o n f o r such in junction o r s p e c i f i c
        performance, and such damages may be a s s e s s e d i n
        such manner a s t h e Court s h a l l d i r e c t .

The e q u i v a l e n t p r o b i s i o n i n A l b e r t a i s contained i n s. 34(11)
of t h e J u d i c a t u r e Act, R.S.A.         1970, c. 193, which reads:
38
      I n a l l c a s e s i n which t h e Court h a s j u r i s d i c t i o n t o
      e n t e r t a i n an a p p l i c a t i o n
       (a)   f o r an injunction against
              (i) a breach of covenant, c o n t r a c t o r
                  agreement, o r
             (ii) t h e commission o r c o n t i n u a n c e of a
                  wrongful a c t , o r
       (b)   f o r t h e s p e c i f i c performance o f a c o v e n a n t ,
             c o n t r a c t o r agreement,
      t h e c o u r t i f i t t h i n k s f i t may award damages t o t h e
      injured p a r t y e i t h e r i n a d d i t i o n t o o r in-sub-
      s t i t u t i o n f o r t h e i n j u n c t i o n o r s p e c i f i c performance,
      and t h e damages may b e a s c e r t a i n e d i n s u c h m a t t e r
      as t h e C o u r t may d i r e c t , o r t h e C o u r t may g r a n t
      such o t h e r r e l i e f a s it deems j u s t .


The more t r a d i t i o n a l i n t e r p r e t a t i o n of Lord C a i r n s ' Act is
t h a t it d o e s n o t s i m p l y g i v e a c o u r t of e q u i t y t h e same
j u r i s d i c t i o n t o award damages as e x i s t e d i n a c o u r t of common
law.        I n Lavery v. P u r c e l l ( l 8 8 8 ) , 39 Ch. D. 508, 519 it
w a s h e l d p e r C h i t t y J. that a c o u r t of e q u i t y c o u l d n o t
award damages i n a case where it c o u l d n o t award s p e c i f i c
performance.

       There a r e t h r e e s i t u a t i o n s which must be c o n s i d e r e d :

       (a) where s p e c i f i c performance c o u l d n o t have
           been awarded b e c a u s e it was n o t t h e t y p e
           of c o n t r a c t which a c o u r t of e q u i t y would
           s p e c i f i c a l l y e n f o r c e , e.g., c o n t r a c t s
           requiring continuing supervision.

       (b)    where s p e c i f i c p e r f onnance would have been
              r e f u s e d on a d i s c r e t i o n a r y ground, e.g.,
              delay.
            (c)    where s p e c i f i c performance could not have
                   been granted because it was impossible given
                   the f a c t s of t h a t case, e.g., land sold t o a
                   t h i r d party.

    I t would seem t h a t i f Lavery v. P u r c e l l has any a p p l i c a t i o n
    i n Canada it would apply t o s i t u a t i o n ( a ) . Y e t i n Dobson v.
    Winton 61 Robbins Ltd. (1960), 2 0 D.L.R.                     (2d) 1 6 4 t h e Supreme
    Court of Canada a p p a r e n t l y undermined t h e b a s i c holding i n
    Lavery v. P u r c e l l . While t h e c a s e d i d n o t d i r e c t l y d e a l with
    p a r t performance it d i d involve an i n t e r p r e t a t i o n of Lord
    Cairns1 Act (which was r e t a i n e d i n t h e Ontario J u d i c a t u r e
    A c t ) . The case involved an enforceable c o n t r a c t f o r the
    s a l e of land i n which s p e c i f i c performance w s impossible
                                                                      a
     ( a s a r e s u l t of a s a l e t o a t h i r d p a r t y ) . Lord Cairns1 Act
    w a s r a i s e d by way of defence t o t h e a c t i o n f o r damages.
'   The c o u r t s t a t e d , a t 166:

            The p r e r e q u i s i t e i n t h e Court of Chancery t o t h e
            e x e r c i s e of j u r i s d i c t i o n under t h i s l e g i s l a t i o n i n
            c o n t r a c t c a s e s was the r i g h t t o r e l i e f by way of
            s p e c i f i c performance.             I f , f o r any reason, a liti-
            gant was before t h e c o u r t without any such r i g h t
            t o r e l i e f , damages could not be awarded and t h e
            p l a i n t i f f was s t i l l l e f t t o hear the remedy, i f any,
            i n a c o u r t of law.
               This j u r i s d i c t i o n a l d i f f i c u l t y disappeared with
            the J u d i c a t u r e Act.    ...         The problem now i s not
            one of j u r i s d i c t i o n o r s u b s t a n t i v e law, but t h e
            narrow one of pleading.           ...
    Other Canadian c a s e s i n which damages have been awarded des-
    p i t e the u n a v a i l a b i l i t y of s p e c i f i c performance a r e McIntyre
    v. Stockdale (1913), 27 O.L.R.                    4 6 1 (H.C.);   P f i e f e r v. P f i e f e r ,
    [1950] 2 W.W.R.          1227; and Brownscombe v. P u b l i c Trustee of
    Alberta, 119691 S.C.R.                 658.
         O t h e o t h e r hand t h e r e i s a s u f f i c i e n t number of c a s e s
          n
which follow Lavery v. P u r c e l l so t h a t t h e law i s s t i l l uncer-
 tain.                                                   -
              See f o r example, Hipgrave v. Case ( 1 8 8 5 ) , 28 Ch. D.
 356; Pearson v. Skinner School Buslines ( S t . Thomas) Ltd.,,
 [I9681 2 O.R. 329 (I.I.C.); C a r t e r v. I r v i n g O i l Co. Ltd.,
 [I952 4 D.L.R. 128 (N. S. S.C. ) ; Robinson v. MacAdam, [I9481
 2 W.W.R. 425.


         A f u r t h e r anomaly a r i s i n g from Lord C a i r n s ' Act i s t h e
p o s s i b i l i t y t h a t t h e measure of damages may, i n t h e d i s c r e t i o n
of t h e c o u r t , be d i f f e r e n t t h a n would be t h e c a s e a t common
law. Thus in Wroth v. T y l e r , [I9731 2 W.L.R. 405, Megarry J.
 s e i z i n g upon t h e wording i n t h e Act t h a t damages may be g r a n t e d
 " i n s u b s t i t u t i o n f o r I' s p e c i f i c perf ormance o r an i n j u n c t i o n ,
 c a l c u l a t e d damages a s of d a t e of judgment i n s t e a d of t h e d a t e
 f o r performance of t h e agreement, t h e l a t t e r being t h e common
 law c r i t e r i o n f o r measuring damages.

         2.     The S t a t u t e of Frauds Cannot Be Used a s an
                Instrument o f Fraud


     It i s long s e t t l e d t h a t t h e S t a t u t e of Frauds cannot be
used a s an i n s t r u m e n t of fraud--'Halfpenny v. B a l l e t (1699 ) ,
2 Vern. 373.     However, t h e i n t e r p r e t a t i o n given t o t h i s
maxim has s e v e r e l y r e s t r i c t e d i t s a p p l i c a t i o n . The most
important r e s t r i c t i o n i s t h a t t h e mere r e f u s a l t o s i g n a
memorandum i s n o t fraud--Maxwell v. Mountacute (1719) , P r e c
               -
Ch. 526; Wood v. Midgley (1854), 5 De G.M.                         & G.    41.     Even i f
t h e defendant a d m i t s t h e c o n t r a c t and t h e n s e e k s t o r a i s e
t h e s t a t u t e i n d e f e n c e , t h i s w i l l n o t be c o n s i d e r e d fraud--
Rondeau v. Wyatt ( 1 7 9 2 ) , 2H. Blk 63; Moore v. ~ d w a r d s(17981,
 (1798), 4 Ves. 23; Cooth v. Jackson (1801), 6 V e s . 1 2 ;
                                                                 -
Plagden v. Bradbear ( 1 8 0 6 ) , 12 Ves. 466; Rowe v. Teed (1808) P
1 5 Ves. 372 (see S t e v e n s , " E t h i c s and t h e S t a t u t e of Frauds,            "
(1952) 37 C o r n e l l L.Q.        355.)
        Apparently what i s r e q u i r e d t o b r i n g t h e maxim i n t o opera-
t i o n i s something more a c t i v e , e.g., f r a u d u l e n t l y p r e v e n t i n g
t h e w r i t t e n evidence of an agreement from coming i n t o e x i s t e n c e
--Maxwell v. Mountacute.

         I n Wakeham v. MacKenzie, [I9681 2 A l l E.R. 783 (Ch. D.)
Stamp J. i n an o b i t e r dictum a t p. 788, suggested t h a t t h e
r e p u d i a t i o n of a c o n t r a c t could be f r a u d , b u t d i d n o t d e c i d e
t h e i s s u e s i n c e it had n o t been pleaded. T h i s s u g g e s t i o n
would obviously be a r a d i c a l d e p a r t u r e from t h e t r a d i t i o n a l
position.

       W e a g r e e w i t h t h e B.C.          Law Reform Commission (Working
Paper, p.       40) t h a t    ". . .        t h e r e s t r i c t e d a p p l i c a t i o n of t h i s
doctrine      even i n England, and i t s conspicuous absence in
Canadian      j u r i s p r u d e n c e s u g g e s t s t h a t l i t t l e weight ought t o
b e given     t o it a s a d e v i c e which s i g n i f i c a n t l y reduces t h e
hardship      of t h e s t a t u t e . "


       3.      Quasi-Contract

          While    plaintiff                        unable      enforce          contract
f a l l i n g within t h e s t a t u t e , he may be a b l e t o r e c o v e r money
on t h e b a s i s of q u a s i - c o n t r a c t .    This r i g h t a r i s e s by opera-
                                -
t i o n of law and n o t e x c o n t r a c t u .

                (a)    Money had and r e c e i v e d

         Some heads of r e c o v e r y under t h e a c t i o n f o r money had
and r e c e i v e d a r e s t a t e d i n Goff & Jones, The Law of
R e s t i t u t i o n (1966) , 1st ed., p. 3:

       The a c t i o n f o r money had and r e c e i v e d l a y t o re-
       cover money which t h e p l a i n t i f f had paid t o t h e
       defendant, on t h e ground t h a t it had been paid
       under a mistake o r compulsion, o r f o r a consid-
       e r a t i o n which had wholly f a i l e d . By t h i s a c t i o n
       t h e p l a i n t i f f could a l s o recover money which t h e
       defendant had r e c e i v e d from a t h i r d p a r t y , a s when
                a
                                            ...
       he w s accountable o r had a t t o r n e d t o t h e p l a i n t i f f
       i n r e s p e c t of t h e money.

The most common occurrence i n which a p l a i n t i f f w i l l be a b l e
t o recover money under t h i s head i s wfien a d e p o s i t has been
paid under an unenforceable c o n t r a c t and t h e defendant r e f u s e s
t o perform. Here t h e p l a i n t i f f can recover on t h e b a s i s of
t o t a l f a i l u r e of c o n s i d e r a t i o n . However, he cannot sue t o
recover t h e money i f t h e defendant i s w i l l i n g and a b l e t o
perform s i n c e t h e r e i s then no f a i l u r e of c o n s i d e r a t i o n
                                   -           -
 [ s e e Goff & Jones, 283; Meek v. Gass (1877), 2 R. & C. 243
(N.S.S.C.)].


               (b)   Account s t a t e d

         To succeed under t h i s head of q u a s i - c o n t r a c t t h e p l a i n t i f f
must be a b l e t o show t h a t he has f u l l y executed h i s p a r t of t h e
c o n t r a c t and t h a t t h e defendant has admitted t h a t he owes t h e
p l a i n t i f f money on t h e c o n t r a c t . This i s i l l u s t r a t e d by t h e
                            -
case of Cocking v. Ward (1845), 1 C.B. 858 i n which t h e p l a i n -
t i f f , a t e n a n t on a farm, had surrendered possession t o t h e
l e s s o r and had secured from t h e l e s s o r t h e acceptance of t h e
defendant a s t e n a n t . The p l a i n t i f f having f u l l y performed
h i s p a r t of t h e c o n t r a c t , t h e defendant r e f u s e d t o pay t h e
p l a i n t i f f t h e agreed upon sum of 5 1 0 0 .      I t was held t h a t t h e
defendant having acknowledged h i s l i a b i l i t y , t h e p l a i n t i f f
was e n t i t l e d t o r e c o v e r t h e 5100 upon an account s t a t e d .

               (c)    Quantum meruit

        Quantum m e r u i t claims l i e t o recover reasonable remunera-
t i o n f o r s e r v i c e s rendered. The l e a d i n g Canadian c a s e i s
Deglman v. Guaranty T r u s t Co. of Canada & Constantineau, [I9541
3 D.L.R.        785 (S.C.C.).      I n t h a t case t h e r e was an alleged
c o n t r a c t under which t h e p l a i n t i f f was t o perform c e r t a i n
s e r v i c e s and t h e defendant t o devise c e r t a i n lands. The
s e r v i c e s w e r e rendered but t h e land was n o t devised. Since
t h e r e was no w r i t t e n note o r memorandum and the p l a i n t i f f
could not e s t a b l i s h s u f f i c i e n t a c t s of p a r t performance the
c o n t r a c t was not t o be enforced. Nevertheless damages were
awarded on a quantum meruit b a s i s .                 The judgment i s c l e a r l y
n o t based on c o n t r a c t b u t upon p r i n c i p l e s of u n j u s t enrich-
ment and r e s t i t u t i o n . A s Cartwright J. s t a t e d , a t 795:


       ...      when the S t a t u t e of Frauds was pleaded t h e
       express c o n t r a c t was thereby rendered unenforce-
       a b l e but t h e deceased having received t h e b e n e f i t s
       of t h e f u l l performance of t h e c o n t r a c t by the
       respondent, t h e law imposed upon her, and so on
       her e s t a t e , t h e o b l i g a t i o n t o pay the f a i r value
       of s e r v i c e s rendered t o her.

      While these heads of quasi-contract provide some relief
t o a p a r t y i n t h e c a s e of an unenforceable c o n t r a c t , they must
be kept i n p e r s p e c t i v e .

        F i r s t , n e i t h e r a claim f o r money had and received nor
a claim f o r quantum meruit has t h e e f f e c t of enforcing the
c o n t r a c t . I n the case of recovery of money paid t h e e f f e c t
i s t o place t h e p l a i n t i f f i n t h e same p o s i t i o n a s i f t h e r e
w e r e no c o n t r a c t . H e w i l l n o t be compensated f o r l o s s of
bargain. A recovery on a quantum meruit b a s i s only compen-
s a t e s the p l a i n t i f f t o t h e e x t e n t of reasonable payment f o r
s e r v i c e s rendered, r e g a r d l e s s of t h e f a c t t h a t t h e c o n t r a c t
i t s e l f provided f o r more v a l u a b l e compensation.              This i s i l l u s -
t r a t e d by the Deglman case i n which the award of $3,000 -                       as
quantum meruit was f a r less than t h e value of t h e property
t h e p l a i n t i f f m u l d have received had t h e c o n t r a c t been
enforceable.

         Second, n e i t h e r head of recovery w i l l compensate f o r
e f f o r t s expended o r expenditures made         r e l i a n c e on t h e
c o n t r a c t . A c l a i m f o r money had and r e c e i v e d r e q u i r e s t h a t
monies be paid t o t h e defendant. Y e t it i s p o s s i b l e f o r the
p l a i n t i f f t o i n c u r expenses, i n r e l i a n c e on t h e c o n t r a c t , by
paying money t o t h i r d p a r t i e s .    Likewise, quantum m e r u i t w i l l
be a v a i l a b l e o n l y when t h e defendant has r e c e i v e d t h e b e n e f i t
of those s e r v i c e s .

E.      E v a l u a t i o n of the Law and Proposals f o r Reform

         I n t h i s s e c t i o n we c o n s i d e r under a number of d i f f e r e n t
headings p o s s i b l e avenues of law reform i n r e s p e c t of c o n t r a c t s
concerning land. W e have attempted t o b a l a n c e t h e advantages
of a p a r t i c u l a r reform a g a i n s t t h e d i s a d v a n t a g e s , and where
a p p r o p r i a t e we have s t a t e d o u r c o n c l u s i o n s .

        1.      C o n t r a c t s f o r t h e S a l e of Land; t h e Q u e s t i o n of
                Repeal

        I n Chaper 3 we noted t h e f u n c t i o n s which a requirement
o f w r i t i n g can s e r v e : e v i d e n t i a r y , c a u t i o n a r y , and c h a n n e l l i n g .
W e a l s o took n o t e of t h e t r a d i t i o n a l criticisms which have
been l e v i e d a g a i n s t t h e S t a t u t e .

          I n o u r view t h e s t r o n g e s t argument in favour of t o t a l
r e p e a l of t h i s p a r t i c u l a r c a t e g o r y i s t h e f a c t t h a t a t l e a s t
i n some cases i n d i v i d u a l s have s u f f e r e d h a r d s h i p a s a r e s u l t
of being precluded from e n f o r c i n g c o n t r a c t s which were c l e a r l y
i n t e n d e d t o be l e g a l l y binding.

         While t h e S t a t u t e may have l e d t o h a r d s h i p o r i n j u s t i c e
i n i n d i v i d u a l c a s e s , we a l s o noted t h a t the S t a t u t e has a l s o
prevented i n j u s t i c e by p r o v i d i n g a complete defence i n
s i t u a t i o n s where a p l a i n t i f f would o t h e r w i s e have p e r j u r e d
himself in a t t e m p t i n g t o e n f o r c e a n o n - e x i s t e n t c o n t r a c t .
This, of c o u r s e , i s t h e e v i d e n t i a r y f u n c t i o n which t h e S t a t u t e
s e r v e s and was t h e major m o t i v a t i o n f o r i t s o r i g i n a l enactment.
If t h i s were t h e only f u n c t i o n of the S t a t u t e r e p e a l would
probably be j u s t i f i e d .     While t h e r e i s no way of e m p i r i c a l l y
proving t h i s , we s u s p e c t t h a t t h e r e have been more i n s t a n c e s
of v a l i d c o n t r a c t s which have been rendered unenforceable by
t h e S t a t u t e than of p o t e n t i a l frauds prevented. A s well, the
c o u r t s seem q u i t e capable of discerning p e r j u r e d testimony and
of deciding disputed f a c t u a l m a t t e r s upon o t h e r than documentary
evidence.          (Indeed i n c r i m i n a l cases, where the consequences
a r e more s i g n i f i c a n t than the enforcement of a c o n t r a c t , the
c o u r t s every day decide c a s e s upon par01 and c i r c u m s t a n t i a l
evidence.) Also, the c o n d i t i o n s i n e x i s t e n c e in 1677, i.e.,
prevalence of p e r j u r y , i n a b i l i t y of p a r t i e s t o t e s t i f y , e t c . ,
no longer provide t h e same compelling need f o r documentary
evidence.

          However, two o t h e r f u n c t i o n s of the S t a t u t e augment t h e
p o s i t i o n i n favour of r e t e n t i o n . I t s e r v e s a v a l u a b l e cau-
t i o n a r y function by warning i n d i v i d u a l s t h a t before a bargain
i s t o be e f f e c t i v e c e r t a i n formal s t e p s must be taken.           I t thus
has t h e e f f e c t of inducing more thoughtful c o n s i d e r a t i o n and
prevents i n d i v i d u a l s from being bound i n circumstances where
perhaps unconsidered, rash d e c i s i o n s have been made. W e a l s o
noted in Chapter I11 t h e more limited channelling e f f e c t which
i s caused by a w r i t i n g requirement.


        I t i s thus n o t merely a s a g a i n s t f r a u d s prevented t h a t
t h e hardship caused by r e t e n t i o n must be balanced, but a l s o
a g a i n s t rash, unconsidered bargains which a r e prevented from
becoming e f f e c t i v e .

          W a r e of t h e opinion t h a t most c o n t r a c t s entered i n t o
            e
w i t h an i n t e n t i o n t o be bound ought t o be enforceable regard-
less of t h e rashness w i t h which one of t h e p a r t i e s may have
acted. This i s t h e g e n e r a l r u l e i n t h e law of c o n t r a c t s , the
reason f o r it being t h e p r o t e c t i o n of t h e e x p e c t a t i o n and
r e l i a n c e i n t e r e s t s of t h e o t h e r party. The question t h a t must
be asked i s whether, given combined e v i d e n t i a r y and c a u t i o n a r y
o b j e c t i v e s , t h e r e should be a d e v i a t i o n from the g e n e r a l r u l e
in t h e case of c o n t r a c t s concerning land. W e have come t o
t h e conclusion t h a t c o n t r a c t s concerning land have c h a r a c t e r i s -
t i c s which, when looked a t t o g e t h e r , j u s t i f y a requirement of
writing:

       1.     They a r e normally of s i g n i f i c a n t pecuniary
              value.         This, by i t s e l f , i s n o t a j u s t i f i c a t i o n
              for retention since there are other financially
              s i g n i f i c a n t t r a n s a c t i o n s n o t r e q u i r e d t o be
              evidenced i n w r i t i n g .

       2.     Such t r a n s a c t i o n s a r e e n t e r e d i n t o by l a r g e
              numbers of l a y persons, n o t j u s t business
              e n t i t i e s . This p a r t i c u l a r c h a r a c t e r i s t i c i s
              s i g n i f i c a n t because it r e n d e r s a l l t h e more
              s i g n i f i c a n t the cautionary objectives. A
              type of t r a n s a c t i o n which i s p r i m a r i l y e n t e r e d
              i n t o by b u s i n e s s e n t i t i e s probably does n o t
              r e q u i r e f o r m a l i t i e s f o r t h e purposes of
              inducing due and t h o u g h t f u l c o n s i d e r a t i o n ,
              whereas in t h e i n s t a n c e of f i n a n c i a l l y s i g n i -
              f i c a n t t r a n s a c t i o n s which a r e e n t e r e d i n t o by
              l a r g e numbers of l a y people, a much s t r o n g e r
              case can be made f o r a c a u t i o n a r y f o r m a l i t y .

       3.     Apart from any pecuniary s i g n i f i c a n c e , c o n t r a c t s
              concerning land o f t e n have an i n t r i n s i c
              importance f o r l a r g e numbers of people.                       The
              buying o r s e l l i n g of a home, f o r many i n d i v i d u a l s ,
              may be t h e most important c o n t r a c t i n t o which
              they w i l l e n t e r i n t h e course of t h e i r l i v e s .
              Such c o n t r a c t s may involve emotional and
              s e n t i m e n t a l c o n s i d e r a t i o n s which, a p a r t from
              t h e money involved, j u s t i f y t h e need f o r a
              cautionary formality.
        4.     The requirement i s probably in accord w i t h
               a c t u a l p r a c t i c e . Most such c o n t r a c t s a r e
               probably evidenced i n w r i t i n g i n any e v e n t
               and a r e probably b e l i e v e d by most people t o
               be r e q u i r e d t o be so. This h a s t h e e f f e c t of
               minimizing t h e h a r d s h i p s normally a s s o c i a t e d
               with t h i s S t a t u t e .

          I n s h o r t , it i s t h e combination of t h e above c h a r a c t e r i s -
t i c s t h a t makes r e t e n t i o n d e s i r a b l e : t h e f a c t t h a t the con-
t r a c t i s s i g n i f i c a n t , both f i n a n c i a l l y and o t h e r w i s e , t o l a r g e
numbers of l a y people.                  I t i s our o p i n i o n t h a t t h e combined
c a u t i o n a r y and e v i d e n t i a r y e f f e c t s of r e t e n t i o n outweigh t h e
i n j u s t i c e and h a r d s h i p caused t o i n d i v i d u a l p l a i n t i f f s . This
h a r d s h i p could be f u r t h e r l e s s e n e d by changes i n t h e law f a l l i n g
s h o r t of t o t a l r e p e a l .      ( W e c o n s i d e r such p o s s i b l e changes
later in t h i s s e c t i o n . ) W e a l s o n o t e t h a t t h i s p a r t i c u l a r
f o r m a l i t y has n o t been r e p e a l e d in any Canadian province, nor
i n England, and t h a t a l l l a w reform bodies which have consid-
e r e d t h e m a t t e r , have recommended i t s r e t e n t i o n , though some-
times w i t h a l t e r a t i o n s (see Appendix 1).


Question 1

                Would you a d v o c a t e a w r i t i n g r e q u i r e m e n t f o r
                some o r a l l c o n t r a c t s r e l a t i n g t o t h e s a l e
                of land? I f s o , f o r which c o n t r a c t s ? Why?


         2.     Whether C o n t r a c t s f o r the S a l e of Land Should
                                        -
                be Required t o be in Writing


          S e c t i o n 4 of t h e S t a t u t e of Frauds c a n be s a t i s i f i e d a t
p r e s e n t e i t h e r i f t h e agreement is i n w r i t i n g o r i f t h e r e is
a n o t e o r memorandum of t h e agreement signed by t h e p a r t y t o
be charged. W e have a l r e a d y noted t h a t one of t h e implica-
t i o n s of t h i s i s t h a t it i s p o s s i b l e f o r t h e S t a t u t e t o be
s a t i s f i e d by a n o t e o r memorandum which comes i n t o e x i s t e n c e
a f t e r t h e i n i t i a l formation of t h e c o n t r a c t . F u r t h e r , a s
l o n g a s such n o t e o r memorandum was signed by t h e d e f e n d a n t
and c o n t a i n s a l l t h e m a t e r i a l terms it i s n o t n e c e s s a r y t h a t
t h e memorandum have been s i g n e d with t h e i n t e n t i o n of s a t i s f y i n g
t h e S t a t u t e o r of v a l i d a t i n g o r a f f i r m i n g t h e c o n t r a c t .    In
f a c t , t h e memorandum c o u l d be a r e p u d i a t i o n of t h e c o n t r a c t ,
a l t h o u g h it cannot deny i t s e x i s t e n c e . The f a c t t h a t a n o t e
o r memorandum subsequent t o t h e formation of t h e c o n t r a c t
c a n s a t i s f y t h e S t a t u t e d e f i n i t e l y p r o v i d e s more f l e x i b i l i t y
t h a n would be t h e c a s e i f t h e requirement was t h a t of t h e
c o n t r a c t being i n w r i t i n g .         Obviously t h e r e would be more
c a s e s of c o n t r a c t s r e n d e r e d unenforceable i f such c o n t r a c t s
           -
had t o be i n w r i t i n g .          S i n c e t h e n o t e o r memorandum must
i n d i c a t e t h e e x i s t e n c e of a c o n t r a c t as w e l l as i t s m a t e r i a l
t e r m s , t h e n o t e o r memorandum requirement i s a l s o c o n s i s t e n t
w i t h t h e e v i d e n t i a r y f u n c t i o n s of t h e S t a t u t e .

            n
          O t h e o t h e r hand, t h e p o s s i b i l i t y of s a t i s f y i n g t h e
S t a t u t e by a subsequent, perhaps i n a d v e r t e n t memorandum, does
n o t f u l f i l t h e c a u t i o n a r y o b j e c t i v e s a s w e l l a s would a
requirement t h a t t h e c o n t r a c t be in w r i t i n g .               I f a party
r a s h l y e n t e r s i n t o an o r a l c o n t r a c t it i s d i f f i c u l t t o see
how a subsequent l e t t e r e i t h e r r e p u d i a t i n g t h e agreement o r
perhaps a t t e m p t i n g t o g a i n concessions, makes t h e i n i t i a l
d e c i s i o n any less r a s h .         I f t h e requirement were one of t h e
agreement being i n w r i t i n g , t h e o n l y way f o r t h e S t a t u t e t o
be s a t i s f i e d a f t e r an i n e f f e c t i v e o r a l agreement would be
f o r t h e p a r t i e s t o p u t t h e a c t u a l agreement t o w r i t i n g .        Such
a s t e p would o b v i o u s l y enhance t h e chances of t h o u g h t f u l
c o n s i d e r a t i o n being g i v e n t o t h e agreement.
        A d e c i s i o n whether t o change t h e p r e s e n t l a w t o r e q u i r e
t h e agreement t o be in w r i t i n g e n t a i l s a weighing of t h e b e t t e r
f u l f i l l m e n t of c a u t i o n a r y o b j e c t i v e s a g a i n s t the f u r t h e r
i n f l e x i b i l i t y which is n e c e s s a r i l y i n c i d e n t a l t o such a change.
  e
W i n v i t e comment on t h i s q u e s t i o n .

QUESTION 2


                Should S e c t i o n 4 a s it relates t o c o n t r a c t s
                f o r t h e s a l e of l a n d be changed t o r e q u i r e
                t h e agreement t o be i n w r i t i n g ?

        3.      The Requirement of a S u f f i c i e n t Note o r Memorandum

          The p r e s e n t s t a t e of Canadian law i s t h a t f o r a n o t e o r
memorandum t o be s u f f i c i e n t it must c o n t a i n a l l t h e m a t e r i a l
t e r m s . This r a t h e r s t r i n g e n t requirement has been t h e source
     much criticism.       the B.C. Law Ref o m Commission p o i n t s
o u t in i t s Working Paper a t p. 128:

        What o f t e n r e s u l t s i s a defendant e s c a p i n g
        l i a b i l i t y under a w r i t t e n agreement which he
        has signed, by proving t h a t , i n f a c t , he and
        t h e p l a i n t i f f had a g r e e d t o a n a d d i t i o n a l t e r m .
        Because t h e term is n o t embodied i n t h e w r i t t e n
        document, t h e S t a t u t e of Frauds i s n o t complied
        w i t h and t h e agreement i s unenforceable.                     ...
              The p r e s e n t l a w in Canada a s t o t h e e f f e c t
        of omitted terms i s c l e a r l y u n s a t i s f a c t o r y .       If
        a t e r m i s deemed " e s s e n t i a l " t o t h e agreement
        a t i s s u e , i t s absence, r e g a r d l e s s of a determin-
        a t i o n a s t o t h e e x i s t e n c e of an agreement
        e v i d e n c e d ' b y t h e signed h i t i n g , w i l l r e n d e r
        t h e whole agreement unenforceable.

          The p r e s e n t law could be l i b e r a l i z e d by r e q u i r i n g t h a t
                                                                              -
t h e w r i t i n g need o n l y e v i d e n c e t h e e x i s t e n c e of a c o n t r a c t ,
a l l o w i n g in p a r 0 1 e v i d e n c e t o prove t h e p r e c i s e terms. A
somewhat less r a d i c a l d e p a r t u r e from e x i s t i n g law would be
t o r e q u i r e t h e w r i t i n g t o e v i d e n c e o r i n d i c a t e a c o n t r a c t of
t h e g e n e r a l n a t u r e of t h e t y p e a l l e g e d .    Any change a l o n g
t h e s e l i n e s would o b v i o u s l y l e s s e n b o t h t h e e v i d e n t i a r y and
c a u t i o n a r y e f f e c t s of t h e w r i t i n g r e q u i r e m e n t , t h e f i r s t
t e s t more so t h a n t h e second.

        A n example of a change of t h e l a t t e r type i s found i n
t h e C o n t r a c t s Enforcement A c t proposed by t h e B.C. Law Reform
Commission in i t s Working Paper, a t p. 143, which r e a d s i n
part:


        10.     N c o n t r a c t concerning an interest in l a n d
                  o
                s h o u l d be e n f o r c e a b l e u n l e s s ;

                 (a)    t h e r e i s some e v i d e n c e i n w r i t i n g
                        which i n d i c a t e s t h a t a c o n t r a c t h a s
                        been made between t h e p a r t i e s , r e a s o n -
                        a b l y i d e n t i f i e s t h e s u bject-matter of
                        t h e c o n t r a c t , and i s s i g n e d by t h e
                        p a r t y t o be charged o r by h i s a g e n t ; o r
                 ( b ) & (c)         (Not r e l e v a n t t o p r e s e n t d i s c u s s i o n . )

                A w r i t i n g r e q u i r e d by t h e S t a t u t e should n o t
                be i n s u f f i c i e n t merely because it o m i t s or
                i n c o r r e c t l y s t a t e s a term a g r e e d upon.

        An example of a s i m i l a r p r o p o s a l c a n be found in t h e
American Unif o m Land T r a n s a c t i o n s A c t , s e c t i o n 2-2 0 1 , which
reads i n part:

        a)      N o t w i t h s t a n d i n g agreement t o t h e c o n t r a r y and
                e x c e p t a s p r o v i d e d in s u b s e c t i o n ( b ) , a con-
                t r a c t t o convey r e a l e s t a t e is n o t e n f o r c e a b l e
                by j u d i c i a l proceeding u n l e s s t h e r e i s a
                w r i t i n g s i g n e d by o r on b e h a l f o f t h e p a r t y
                a g a i n s t whom enforcement i s s o u g h t which des-
                c r i b e s t h e r e a l e s t a t e and i s s u f f i c i e n t t o
                i n d i c a t e t h a t a c o n t r a c t t o convey has been
                made by t h e p a r t i e s .

The e x p l a n a t o r y comments on t h i s s e c t i o n i n d i c a t e t h a t b e s i d e s
r e j e c t i n g t h e " m a t e r i a l terms" r e q u i r e m e n t , t h e i n t e n t i s :
        ...         n o t t h a t t h e c o n t r a c t o r memorandum of
        t h e c o n t r a c t be i n w r i t i n g , n o r t h a t t h e w r i t i n g
        be s u f f i c i e n t t o i t s e l f e s t a b l i s h t h a t a con-
        t r a c t h a s been made.              I t need merely be s u f f i -
        c i e n t t o afford a basis for believing t h a t the
        o f f e r e d o r a l evidence t h a t a c o n t r a c t w s i n a
        f a c t made rests on a r e a l t r a n s a c t i o n . For
        example, a w r i t t e n o f f e r w i t h a s u f f i c i e n t
        d e s c r i p t i o n , p r o p e r l y s i g n e d , would be a s u f f i -
        c i e n t memorandum a g a i n s t t h e s i g n e r even though
        t h e r e i s no w r i t i n g i n d i c a t i n g t h a t t h e o f f e r
           a
        w s in f a c t a c c e p t e d .

          Obviously t h e e f f e c t which any change in t h e law would
have i n t h i s area depends t o a l a r g e d e g r e e on t h e p r e c i s e
wording used i n any l e g i s l a t i o n . A t t h e p r e s e n t t i m e w a r e       e
n o t p r e p a r e d t o p r o p o s e any s p e c i f i c p i e c e s of d r a f t l e g i s -
                   e
l a t i o n . W do however p o i n t o u t t h a t any l i b e r a l i z a t i o n of
t h e l a w would be a s t e p away from a c h i e v i n g e v i d e n t i a r y and
c a u t i o n a r y o b j e c t i v e s and toward e n f o r c i n g c o n t r a c t u a l
b a r g a i n s and more f l e x i b i l i t y . Given t h e s e i n c o n s i s t e n t
o b j e c t i v e s , we i n v i t e comment on whether t h e r e s h o u l d be
any change i n t h e l a w .

QUESTION 3

        Should a s u f f i c i e n t n o t e o r memorandum be r e q u i r e d
        t o c o n t a i n a l l t h e material terms o f t h e agreement?

        4.    C o n t r a c t s Executed bv Both P a r t i e s

          I n most cases of c o n t r a c t s f u l l y performed by b o t h p a r t i e s
t h e i s s u e of e n f o r c e a b i l i t y w i l l n o t arise. Any a t t e m p t by one
p a r t y t o undo t h e c o n t r a c t ( r e c o v e r p r o p e r t y conveyed o r money
p a i d ) can be m e t by t h e s u c c e s s f u l d e f e n c e - t h a t s u c h p r o p e r t y
w a s conveyed o r money p a i d under a v a l i d c o n t r a c t . One cir-
c u m s t a n c e i n which t h e i s s u e o f e n f o r c e a b i l i t y w i l l arise i n
c o n t r a c t s e x e c u t e d by b o t h p a r t i e s i s when a p a r t y s e e k s
damages f o r b r e a c h of w a r r a n t y . W e i n v i t e comment on t h e
following question.
QUESTION 4


        Should c o n t r a c t s completely executed by both p a r t i e s
        be e n f o r c e a b l e , n o t w i t h s t a n d i n g t h e absence of a
        note o r memorandum?

        5.    Doctrine of P a r t Performance

        W e have examined in some d e p t h t h e p r e s e n t s t a t e of t h e
law r e l a t i n g t o p a r t performance. To b r i e f l y r e c a p i t u l a t e t h e
Canadian p o s i t i o n , t h e a c t s o f p a r t performance must r e l a t e
t o t h e land in q u e s t i o n , must be unequivocally r e f e r a b l e t o a
c o n t r a c t such a s t h a t a l l e g e d , and must have been acquiesced i n
by t h e defendant.                I n c o n t r a s t t o t h e Canadian p o s i t i o n i s t h e
i n c r e a s i n g l y l i b e r a l i n t e r p r e t a t i o n given t o the d o c t r i n e of
p a r t performance by the E n g l i s h c o u r t s , c u l m i n a t i n g in t h e
d e c i s i o n i n Steadman v. Steadman, under which t h e a c t s need
n o t r e l a t e s p e c i f i c a l l y t o t h e land and need o n l y prove on a
b a l a n c e of p r o b a b i l i t i e s t h e e x i s t e n c e of - agreement.
                                                                        an

       A good c a s e c a n be made t h a t t h e d o c t r i n e of p a r t per-
formance should be l i b e r a l i z e d .                  Since, f o r t h e d o c t r i n e t o
have any a p p l i c a t i o n i n t h e f i r s t p l a c e , t h e d e f e n d a n t must
have consented o r acquiesced in t h e a c t s of t h e p l a i n t i f f ( t h e
acquiescence o f t h e defendant being t h e s u b s t i t u t e f o r h i s
s i g n a t u r e ) , it seems r e a s o n a b l e t o assume t h a t t h e defendant
h a s decided t o a f f i r m t h e o r a l agreement, however r a s h o r
i l l - c o n s i d e r e d h i s o r i g i n a l d e c i s i o n may have been.        Thus,
t h e o b j e c t i v e of p r o t e c t i n g p a r t i e s from r a s h d e c i s i o n s would
seem t o be of less importance i n t h i s c o n t e x t . The acquies-
e n c e of t h e d e f e n d a n t a l s o provides s u f f i c i e n t evidence of h i s
i n t e n t i o n t o be c o n t r a c t u a l l y bound.

       A second a s p e c t of t h e d o c t r i n e of p a r t performance is
t h a t i n many c a s e s the p l a i n t i f f w i l l have r e l i e d on t h e con-
                                                                                               53
t r a c t t o h i s d e t r i m e n t , sometimes i n c i r c u m s t a n c e s under which
he could r e c e i v e no compensation under a head of q u a s i - c o n t r a c t .
T h i s t o would seem t o weigh t h e s c a l e s i n favour of e n f o r c i n g
c l e a r l y intended c o n t r a c t u a l bargains.


       Given t h e s e f a c t o r s it i s a r g u a b l e t h a t t h e d o c t r i n e of
p a r t performance ought t o encompass any a c t , i n c l u d i n g
d e p o s i t s , a c q u i e s c e d i n by t h e d e f e n d a n t , and n o t j u s t a c t s
r e l a t i n g t o land.           Indeed s. 7 of t h e S a l e of Goods A c t , R.S.A.
1970, c. 327 r e c o g n i z e s t h i s p r i n c i p l e :

        7. (1) A c o n t r a c t f o r t h e s a l e of any goods of t h e
               v a l u e of f i f t y d o l l a r s o r upwards i s n o t
               e n f o r c e a b l e by a c t i o n
                 a ) u n l e s s t h e buyer a c c e p t s p a r t of t h e
                     goods s o s o l d and a c t u a l l y r e c e i v e s t h e
                     s a m e , o r g i v e s something i n e a r n e s t t o
                     bind the c o n t r a c t o r in p a r t payment, or

                 b) u n l e s s some n o t e o r memorandum i n w r i t i n g
                    of t h e c o n t r a c t i s made and signed by
                    t h e p a r t y t o be charged o r h i s a g e n t in
                    t h a t behalf,
           (3) There i s a n a c c e p t a n c e of goods w i t h i n t h e
               meaning of t h i s s e c t i o n when t h e buyer does
               anv a c t , i n r e l a t i o n t o t h e aoods. t h e
               r e c o g n i z e s a p r e - e x i s t i n g c o n t r a c t of s a l e
               whether t h e r e i s a n acceptance in performance          -
               of t h e c o n t r a c t o r c o n t r a c t .

       The B.C. Law Reform Commission h a s proposed i n i t s
Working Paper a r a d i c a l change i n t h e d o c t r i n e of p a r t p e r f o r -
mance.    S e c t i o n s 10 and 1 2 of i t s proposed C o n t r a c t s Enforcement
A c t read i n p a r t :


        10.    NO  c o n t r a c t concerning an i n t e r e s t i n l a n d
                should be e n f o r c e a b l e u n l e s s ;
                (b) t h e p a r t y t o be charged a c q u i e s c e s i n
                    a c t s of t h e p a r t y a l l e g i n g t h e c o n t r a c t ,
                    which i n d i c a t e t h a t a c o n t r a c t , n o t
                    i n c o n s i s t e n t w i t h t h a t a l l e g e d , has
                    been made between t h e p a r t i e s ;
        12.     Without l i m i t i n g t h e g e n e r a l i t y of t h e
                meaning of " a c t s of t h e p a r t y a l l e g i n g t h e
                c o n t r a c t " i n Proposal 1 0 ( b ) , t h a t t e r m
                should i n c l u d e t h e s i t u a t i o n where t h e p a r t y
                a l l e g i n g t h e c o n t r a c t has made a d e p o s i t , o r
                p a r t payment of t h e purchase p r i c e .

        Besides i n c l u d i n g any a c t s of t h e p l a i n t i f f w i t h i n t h e
ambit of t h e d o c t r i n e , t h e B.C. Law Reform Commission p r o p o s a l
would markedly change t h e s t a n d a r d of proof from "unequivocal
r e f e r a b i l i t y " t o t h a t of merely i n d i c a t i n g a c o n t r a c t , "not
inconsistent with t h a t alleged. "

       A somewhat less r a d i c a l change i n t h e s t a n d a r d of proof
c o u l d be one i n which t h e a c t s must a t l e a s t i n d i c a t e a
c o n t r a c t of t h e t y p e a l l e g e d .

       A p o s s i b l e compromise between t h e ~ r i t i s hColumbia Law
Reform Commission p r o p o s a l and t h e p r e s e n t Canadian law i s
found in s e c t i o n 2-201 of t h e Uniform Land T r a n s a c t i o n s A c t
which r e a d s i n p a r t :

        (b)    A c o n t r a c t n o t evidenced by a w r i t i n g
                s a t i s f y i n g t h e requirements of s u b s e c t i o n
                ( a ) but which i s v a l i d i n o t h e r r e s p e c t s ,
                is enforceable i f :
                (2)    The buyer h a s taken p o s s e s s i o n of the
                       real e s t a t e and has p a i d a l l o r a p a r t
                       of t h e p r i c e ;
                (4)    e i t h e r p a r t y , in r e a s o n a b l e r e l i a n c e
                       upon t h e c o n t r a c t and upon t h e c o n t i n -
                       u i n g a s s e n t of t h e p a r t y a g a i n s t whom
                       enforcement i s sought, has changed h i s
                       p o s i t i o n t o t h e e x t e n t t h a t an unreason-
                       a b l e r e s u l t can be avoided o n l y by
                       enforcing the contract;

       The o n l y r e a l argument i n favour of r e t e n t i o n of t h e
p r e s e n t ~ a n a d i a nlaw i s t h a t t h e p r e s e n t d o c t r i n e a t least
r e q u i r e s a c t s which e v i d e n c e a c o n t r a c t i n r e l a t i o n t o t h e
                                                                                         55
l a n d i n q u e s t i o n , whereas both t h e Unif orm Land T r a n s a c t i o n
Act and t h e B r i t i s h Columbia Law Reform Commission p r o p o s a l
envisage a c t s which might i n d i c a t e a c o n t r a c t , b u t n o t nec-
e s s a r i l y one of t h e l a n d in q u e s t i o n , nor indeed of any l a n d .
For example, a d e p o s i t r e t a i n e d by t h e d e f e n d a n t , might be
s u f f i c i e n t evidence of a c o n t r a c t , b u t c e r t a i n l y n o t one
r e l a t i n g t o a p a r t i c u l a r p i e c e of land. Thus t h e p r e s e n t
p o s i t i o n in Canada better s e r v e s an e v i d e n t i a r y f u n c t i o n .
Balanced a g a i n s t t h i s , a r e t h r e e f a c t o r s , which s t r o n g l y favour
a less s t r i n g e n t s t a n d a r d :

       1.     The c a u t i o n a r y impact of t h e w r i t i n g
              requirement i s of less importance
              where t h e r e h a s been acquiescence t o
              a c t s of p a r t performance.

       2.     I n many c a s e s of p a r t performance t h e
              p l a i n t i f f w i l l have r e l i e d on t h e
              c o n t r a c t t o an e x t e n t t h a t i n j u s t i c e
              can be avoided o n l y by e n f o r c i n g t h e
              contract.

       3.     I n any e v e n t t h e a c t s of p a r t performance
              would n o t of themselves be t h e f i n a l proof
              of t h e c o n t r a c t a l l e g e d . The elements of
              a v a l i d c o n t r a c t i n c l u d i n g f i n a l i t y of
              agreement and c e r t a i n t y , a s w e l l a s the
              terms would s t i l l have t o be proved by
              par01 e v i d e n c e .

       W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n s .

Question 5

              Should t h e d o c t r i n e of p a r t performance be
              expanded t o i n c l u d e a c t s , which e v i d e n c e a
              c o n t r a c t , done by t h e P l a i n t i f f and acquiesced
                 i n by t h e Defendant, o t h e r t h a n a c t s r e l a t i n g
                 t o t h e land i n question?

Question 6

                 Should t h e d o c t r i n e of p a r t performance s p e c i -
                 f i c a l l y i n c l u d e t h e g i v i n g of a d e p o s i t o r p a r t
                 payment?

Question 7

                 Should t h e p r e s e n t s t a n d a r d of l l u n e q u i v o c a l
                 r e f e r a b i l i t y " b e lowered?



         6.      A c t s Done bv t h e Defendant


        Under e x i s t i n g l a w a c t s o f p a r t performance must be t h o s e
o f t h e p l a i n t i f f which have been a c q u i e s c e d in by t h e d e f e n d a n t .
The a c q u i e s c e n c e of t h e d e f e n d a n t t o t h e s e a c t s p r o v i d e s t h e
n e c e s s a r y a l t e r n a t e e v i d e n c e in s u b s t i t u t i o n of t h e s i g n a t u r e .
Y e t , p o s i t i v e a c t s done by t h e d e f e n d a n t c a n n o t , under p r e s e n t
law, be acts of p a r t performance.                       T h i s a s p e c t of t h e law h a s
been c r i t i c i z e d a s b e i n g i l l o g i c a l :


        There is, however, no d o u b t t h a t t h e c r u c i a l
        element of t h e d o c t r i n e of p a r t performance i s ,
        under t h e p r e s e n t l a w , t h e a c q u i e s c e n c e of t h e
        defendant i n acts of t h e p l a i n t i f f .            We f i a l
        t o see why o s i t i v e a c t s of a d e f e n d a n t which
        e s t a b l i s h t a t h e bound h i m s e l f should n o t be
        of e q u a l v a l u e .
                                             -B.C.  Law Reform Commission
                                               Working Paper, p. 142

Such criticism seems j u s t i f i e d .       P o s i t i v e a c t s do seem t o
b e even better e v i d e n c e t h a n m e r e a c q u i e s c e n c e .
                                                                                      57
QUESTION 8

       Should t h e d o c t r i n e o f p a r t performance i n c l u d e a c t s
       of t h e d e f e n d a n t ?



       7.      Damages

       The r i g h t of a p l a i n t i f f t o r e c e i v e damages i n circum-
s t a n c e s where s p e c i f i c performance c o u l d n o t o r would n o t be
awarded, even though s u f f i c i e n t a c t s of p a r t performance
have been proved, i s , a t b e s t , u n c e r t a i n , T h e r e are t h r e e
s i t u a t i o n s i n which acts o f p a r t performance might be proved
and in which s p e c i f i c performance might n o t be awarded:

       1)     Where t h e c o n t r a c t i s n o t t h e t y p e of
              c o n t r a c t f o r which a c o u r t o f e q u i t y
              c o u l d award s p e c i f i c performance,                (This
              h a s no r e l e v a n c e i n t h e p r e s e n t c o n t e x t
              s i n c e c o n t r a c t s c o n c e r n i n g l a n d are
              c l e a r l y t h e t y p e of c o n t r a c t o v e r which
              a c o u r t o f e q u i t y had j u r i s d i c t i o n . )

       2)     Where s p e c i f i c performance i s n o t
              a v a i l a b l e on d i s c r e t i o n a r y g r o u n d s such
              as undue d e l a y , i n e q u i t a b l e c o n d u c t of
              the p l a i n t i f f , etc.


       3)     Where s p e c i f i c performance i s i m p o s s i b l e
              on t h e f a c t s , e - g , , t h e l a n d h a s been
              sold t o a t h i r d party.

The p o l i c y c o n s i d e r a t i o n s r e l a t i n g t o whether damages s h o u l d
b e a v a i l a b l e d i f f e r f o r c a t e g o r i e s 2 and 3 ,  I n t h e c a s e of
c a t e g o r y 3 it i s d i f f i c u l t t o s e e why a p l a i n t i f f should n o t be
a b l e t o r e c o v e r damages, merely because t h e d e f e n d a n t h a s done
some act, such a s sale t o a t h i r d p a r t y , which r e n d e r s s p e c i f i c
performance p h y s i c a l l y i m p o s s i b l e ,
          Where, however, s p e c i f i c performance would n o t have been
awarded on d i s c r e t i o n a r y grounds ( c a t e g o r y 2 ) , such a s d e l a y o r
i n e q u i t a b l e conduct, it i s a r g u a b l e t h a t t h e conduct which has
b a r r e d s p e c i f i c performance should a l s o be a b a r t o a damages
award.

QUESTION 9

       Where t h e r e a r e s u f f i c i e n t a c t s of p a r t performance
       should damages be a v a i l a b l e where s p e c i f i c p e r f o r -
       mance would be b a r r e d on d i s c r e t i o n a r y grounds?

QUESTION 10

       Where t h e r e a r e s u f f i c i e n t a c t s of p a r t performance,
       should damages be a v a i l a b l e where s p e c i f i c p e r f o r -
       mance would n o t be p o s s i b l e on t h e f a c t s ?

        8.      Quasi-Contractual Remedies

          I n our d i s c u s s i o n of q u a s i c o n t r a c t u a l r e l i e f , w noted
                                                                                        e
t h a t where a c o n t r a c t i s u n e n f o r c e a b l e , a p a r t y can n o n e t h e l e s s
r e c o v e r monies p a i d o r be compensated f o r s e r v i c e s rendered
which have u n j u s t l y e n r i c h e d t h e o t h e r p a r t y .           However no such
r e c o v e r y i s a v a i l a b l e where t h e e x p e n d i t u r e of money o r e f f o r t
i n r e l i a n c e on t h e c o n t r a c t does n o t c o n s t i t u t e a b e n e f i t
c o n f e r r e d on t h e o t h e r p a r t y .

        It i s a r g u a b l e t h a t a s a compromise measure t h e r e should
b e compensation i n such s i t u a t i o n s .             I t i s n o t an i n d i r e c t
way of e n f o r c i n g t h e c o n t r a c t ; o n l y compensation f o r l o s s of
b a r g a i n would accomplish t h a t . A t t h e same time compensating
a p a r t y f o r e x p e n d i t u r e s made i n r e l i a n c e on t h e c o n t r a c t does
m i t i g a t e some of t h e h a r d s h i p c r e a t e d by t h e S t a t u t e . The
B.C.     Law Reform Commission i n i t s Working Paper proposed, a t
pp. 145, 146, t h a t a c o u r t should a t l e a s t have t h e d i s c r e t i o n
t o award compensation f o r e x p e n d i t u r e s made which do n o t
c o n s t i t u t e a b e n e f i t f o r t h e defendant. S e c t i o n 13 of i t s
proposed C o n t r a c t s Enforcement A c t r e a d s :

       Where a c o n t r a c t i s u n e n f o r c e a b l e p u r s u a n t t o
       our p r o p o s a l s , a c o u r t should be a b l e t o g r a n t
       t o t h e p l a i n t i f f such r e l i e f ,

       (a)    by way of r e s t i t u t i o n of any b e n e f i t r e c e i v e d
              by t h e p a r t y t o be charged, and
       (b)    by way of compensation of moneys expended in
              r e l i a n c e on t h e c o n t r a c t ,
       as i s j u s t .

        W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n .


 QUESTION 11

        Where a c o n t r a c t i s u n e n f o r c e a b l e should t h e r e be
        compensation a s o f r i g h t f o r e x p e n d i t u r e s made i n
        r e l i a n c e on t h e c o n t r a c t , and which do n o t c o n f e r
        a b e n e f i t on t h e p a r t y t o be charged, and if n o t ,
        should such compensation be a v a i l a b l e in t h e
        d i s c r e t i o n of t h e court?


         9.     Real E s t a t e Agency C o n t r a c t s

            e
          W have s e e n t h a t s e c t i o n 4 of t h e S t a t u t e of Frauds
 d o e s n o t cover c o n t r a c t s between a r e a l e s t a t e a g e n t and
 vendor. This is because t h e s e have been t r e a t e d n o t a s
 c o n t r a c t s f o r t h e s a l e of an i n t e r e s t in land b u t a s c o n t r a c t s
 of s e r v i c e . However, s e c t i o n 2 2 of t h e Real E s t a t e Agents
 L i c e n s i n g A c t , R.S.A. 1970, c . 311 d o e s impose a requirement
 of w r i t i n g f o r such c o n t r a c t s . The s e c t i o n p r o v i d e s :
         o
       N a c t i o n s h a l l be brought t o c h a r g e a person
       by commission o r o t h e r w i s e f o r s e r v i c e s
       r e n d e r e d in c o n n e c t i o n w i t h t h e s a l e of l a n d ,
       tenement o r h e r e d i t a m e n t s , o r a n i n t e r e s t
       therein, unless
       (a)     t h e c o n t r a c t upon which r e c o v e r y is
               sought in t h e a c t i o n o r some n o t e o r
               memorandum t h e r e o f i s in w r i t i n g signed
               by t h e p a r t y t o be charged o r by h i s
               a g e n t l a w f u l l y a u t h o r i z e d in w r i t i n g , o r
       (b)     t h e p e r s o n sought t o be charged
                 ( i ) h a s a s a r e s u l t of t h e s e r v i c e s of
                       an a g e n t employed by him f o r t h e
                       purpose e f f e c t e d a s a l e o r l e a s e
                       of l a n d s , tenements and h e r e d i t a -
                       ments o r any i n t e r e s t t h e r e i n , and
               (ii) has e i t h e r e x e c u t e d a t r a n s f e r o r
                    lease signed by a l l o t h e r n e c e s s a r y
                    p a r t i e s and d e l i v e r e d it t o t h e
                    p u r c h a s e r , o r h a s executed an a g r e e -
                    ment of s a l e of l a n d s , tenements and
                    h e r e d i t a m e n t s o r an interest t h e r e i n ,
                    s i g n e d by a l l n e c e s s a r y p a r t i e s ,
                    e n t i t l i n g t h e purchaser t o possession
                    of l a n d s , tenements and h e r e d i t a m e n t s
                    o r any i n t e r e s t t h e r e i n , as s p e c i f i e d
                    i n t h e agreement, and has d e l i v e r e d
                    t h e agreement t o t h e p u r c h a s e r .

       S e c t i o n 22 ( a ) w a s e n a c t e d in t h e f i r s t s i t t i n g of t h e
f i r s t l e g i s l a t u r e of t h e newly c r e a t e d p r o v i n c e of Alberta--
S.A. 1906, c. 27, s. 1. S. 22 ( b ) was added i n t h e S t a t u t e
Law Amendment Act, S.A. 1920 c. 4, s. 38 (1). These two s t a t u t e s
w e r e joined t o form t h e Real Estates Commission A c t , R.S.A.
1922, c. 139. The s e c t i o n w a s f i n a l l y i n c o r p o r a t e d i n t o t h e
p r e s e n t Real E s t a t e s Agent A c t by S.A. 1947, c. 15. L e g i s l a -
t i o n t o s i m i l a r e f f e c t has been e n a c t e d in Saskatchewan ( ~ e a l
E s t a t e Brokers A c t S.S. 1968, c. 58, s. 4 1 ) ; Manitoba
 (Real E s t a t e Brokers A c t R.S.M. 1970, c . R-20) ; New Brunswick
 ( S t a t u t e of F r a u d s R.S.N.B.    1973, c. S-14, s. 6 ) ; and
O n t a r i o (Real Estate and Business Brokers A c t                         R.S. 0 .   1970,
c. 401, s. 3 4 ) .
           Under s u b s e c t i o n ( b ) i f a s a l e h a s been e f f e c t e d and,
 e i t h e r a document of conveyance o r a n agreement f o r sale
 has been executed and d e l i v e r e d t o t h e p u r c h a s e r , t h e n t h e
 c o n t r a c t of agency i s e n f o r c e a b l e even i f n o t evidenced i n
 w r i t i n g . The c r i t e r i o n of e n f o r c e a b i l i t y under t h i s sub-
 s e c t i o n t h u s seems t o be t h e a b i l i t y of t h e p u r c h a s e r t o
e n f o r c e a c o n t r a c t of s a l e . I n e f f e c t , this s u b s e c t i o n
limits, f o r a l l p r a c t i c a l purposes, t h e r e q u i r e m e n t of
w r i t i n g t o two t y p e s of agency c o n t r a c t s :

             Those where t h e a g e n t has e f f e c t e d a c o n t r a c t o f
             s a l e , b u t where n e i t h e r a document of conveyance
             nor an agreement of s a l e , e n t i t l i n g t h e p u r c h a s e r
             t o p o s s e s s i o n , h a s been b o t h e x e c u t e d by t h e
             vendor and d e l i v e r e d t o t h e p u r c h a s e r .            One c a n
             query whether t h e u s u a l i n t e r i m agreement i s one
             " e n t i t l i n g t h e purchaser t o possession".                    I f so,
             -
             most o r a l agency c o n t r a c t s through which a c o n t r a c t
             of s a l e i s e v e n t u a l l y made by way of a w r i t t e n
             i n t e r i m agreement w i l l be e n f o r c e a b l e . However,
             i f t h e vendor d o e s n o t have t i t l e o r i f a
             n e c e s s a r y dower a c t c o n s e n t c a n n o t be p r o c u r e d ,
             t h e n t h e i n t e r i m agreement would n o t be one
             " e n t i t l i n g t h e p u r c h a s e r t o p o s s e s s i o n " and t h e
             o r a l agency c o n t r a c t would be u n e n f o r c e a b l e .

      2.      Those which p r o v i d e f o r payment t o t h e a g e n t
              even where a c o n t r a c t of s a l e i s n o t u l t i m a t e l y
              consummated, e.g. on t h e i n t r o d u c t i o n of a
              p r o s p e c t i v e p u r c h a s e r , o r t h e making of an
              o f f e r which i s n o t a c c e p t e d .

      The s u b s t a n t i v e law on t h i s p o i n t i s set o u t i n
1.   H a l s b u r y ' s Laws of England (3rd ed. 1 9 5 2 ) , 1 9 9 :
        If t h e a g e n t d e s i r e s t o bind t h e p r i n c i p a l t o
        pay commission, n o t o n l y on sales b u t on t h e
        i n t r o d u c t i o n of a person who makes a n o f f e r t o
        purchase as c o n t r a s t e d w i t h one who a c t u a l l y
        buys, he must use clear and unequivocal language
        to that effect.

        S e c t i o n 2 2 o f t h e R e a l E s t a t e Agents L i c e n s i n g A c t expands
t h e common l a w r e q u i r e m e n t of clear and unambiguous language
t o t h a t of r e q u i r i n g such c l a r i t y i n w r i t i n g .


        W e r e c o g n i z e t h a t t h e r e i s some i n c o n s i s t e n c y in r e q u i r -
i n g w r i t i n g f o r t h i s p a r t i c u l a r kind of s e r v i c e c o n t r a c t and
n o t f o r o t h e r s . However, t h e impact of t h e s e c t i o n i s s u c h
t h a t it a p p l i e s i n limited circumstances.                      T h i s type of
s e r v i c e c o n t r a c t , w h i l e n o t uncommon, d o e s impose an u n u s u a l
l i a b i l i t y upon t h e p r i n c i p a l . W e a l s o n o t e t h a t because r e a l
e s t a t e agency c o n t r a c t s are f r e q u e n t l y e n t e r e d i n t o by l a y
p e o p l e w i t h o u t t h e b e n e f i t of l e g a l a d v i c e t h e w r i t i n g r e q u i r e -
ment s e r v e s a n i m p o r t a n t c a u t i o n a r y f u n c t i o n .

           An argument can be made, t h e r e f o r e , t h a t b e f o r e an
employer should be l i a b l e upon, say, t h e mere i n t r o d u c t i o n
of a p r o s p e c t i v e p u r c h a s e r , o r upon t h e making of an o f f e r
which i s n o t a c c e p t e d , t h e r e should be w r i t t e n evidence of
such a c o n t r a c t u a l t e r m .         Because of t h e n a t u r e of t h e l i a -
b i l i t y , s p e c i a l c a u t i o n a r y p r o t e c t i o n i s perhaps d e s i r a b l e .
Also, t h e r e q u i r e m e n t of w r i t i n g w i l l s e r v e a u s e f u l eviden-
t i a r y f u n c t i o n i n what would o t h e r w i s e be a n a r e a prone t o
l i t i g a t i o n - - s e e e.g. Luxor v. Cooper, [1941] A.C. 108. W e
i n v i t e comment on t h e f o l l o w i n g q u e s t i o n :

QUEST ION 1 1 A :

        Should t h e r e be a requirement of w r i t i n g f o r
        c o n t r a c t s between vendors of land and real
        e s t a t e agents?
                                              CHAPTER V

                         CONVEYANCES OF INTERESTS I N LAND


A.      S e c t i o n s 1 and 3 of t h e S t a t u t e of Frauds


          I n Chapter 4 we c o n s i d e r e d t h e f o r m a l i t i e s under t h e
S t a t u t e of Frauds n e c e s s a r y t o r e n d e r a c o n t r a c t t o convey
enforceable.         In addition t o the section 4 formalities,
S e c t i o n s 1 and 3 a l s o impose f o r m a l i t i e s i n t h e c a s e of t h e
a c t u a l conveyances themselves.

      S e c t i o n 1 r e l a t e s t o t h e c r e a t i o n of an e s t a t e o r i n t e r e s t
i n land - -
           de novo, whereas S e c t i o n 3 r e l a t e s t o t h e t r a n s f e r of
an a l r e a d y e x i s t i n g e s t a t e , whether such t r a n s f e r be by way of
assignment, common g r a n t , o r s u r r e n d e r .      S e c t i o n 4 , of c o u r s e ,
d e a l s w i t h c o n t r a c t s t o convey o r c r e a t e an i n t e r e s t , a s
opposed t o t h e conveyance i t s e l f .                 -   see Leith         &   Smith,
B l a c k s t o n e ' s Commentaries on t h e Laws of England Applicable
t o Real P r o p e r t y 327 (2nd ed., 1880)                   .
                                                    Falling within Section
1 a r e t h e c r e a t i o n of l e a s e h o l d e s t a t e s ( a s opposed t o t h e
assignment o r s u r r e n d e r of p r e s e n t l y e x i s t i n g l e a s e h o l d
e s t a t e s ) and l i f e e s t a t e s .     Most o t h e r conveyances f a l l w i t h i n
S e c t i o n 3. Under S e c t i o n 1 t h e i n t e r e s t conveyed must be put
i n w r i t i n g and s i g n e d by t h e p a r t y c r e a t i n g t h e i n t e r e s t o r by
h i s a g e n t l a w f u l l y a u t h o r i z e d i n w r i t i n g ; t h e e f f e c t of a
conveyance n o t complying w i t h S e c t i o n 1 i s t o r e n d e r t h e
i n t e r e s t o r e s t a t e c r e a t e d an " e s t a t e a t w i l l " .       I n the case
of S e c t i o n 3 t h e conveyance must be by "deed o r n o t e i n
w r i t i n g " signed by t h e p a r t y conveying o r by h i s a g e n t law-
f u l l y a u t h o r i z e d i n w r i t i n g ; no mention i s made of t h e e f f e c t
of f a i l u r e t o comply.

          I n a d d i t i o n t o S e c t i o n s 1 and 3 of t h e S t a t u t e of Frauds
S e c t i o n 56 of t h e Land T i t l e s Act, R.S.A.           1970, c. 198 provides:
       A f t e r a c e r t i f i c a t e of t i t l e has been g r a n t e d
       f o r any l a n d , no i n s t r u m e n t i s e f f e c t u a l t o
       p a s s any e s t a t e o r i n t e r e s t i n t h a t land ( e x c e p t
       a leasehold i n t e r e s t f o r three years o r f o r a
       l e s s p e r i o d ) o r t o r e n d e r t h a t land l i a b l e a s
       s e c u r i t y f o r t h e payment of money, u n l e s s t h e
       instrument i s executed i n accordance with t h e
       p r o v i s i o n s of t h i s Act and i s d u l y r e g i s t e r e d
       thereunder, b u t upon t h e r e g i s t r a t i o n of any
       such i n s t r u m e n t i n t h e manner h e r e i n b e f o r e
       prescribed the e s t a t e o r i n t e r e s t specified
       t h e r e i n p a s s e s o r , a s t h e c a s e may be, t h e
       land becomes l i a b l e a s s e c u r i t y i n manner and
       s u b j e c t t o t h e covenants, c o n d i t i o n s and
       c o n t i n g e n c i e s set f o r t h and s p e c i f i e d in t h e
       instrument o r by t h i s Act d e c l a r e d t o be
       implied i n i n s t r u m e n t s of a l i k e n a t u r e .

        S e c t i o n 56 h a s been i n t e r p r e t e d a s r e q u i r i n g r e g i s t r a t i o n
i n order t o p r o t e c t t h i r d parties.              However a s between a
t r a n s f e r o r and t r a n s f e r e e , an i n t e r e s t i n land can p a s s even
p r i o r t o r e g i s t r a t i o n of an i n s t r u m e n t of conveyance.            In
Re Church, [I9231 3 W.W.R.                 405, 409 (S.C.C.)           I d l i n g t o n , J.
considered t h e e f f e c t of S e c t i o n 4 1 , a p r e d e c e s s o r s e c t i o n t o
S e c t i o n 56:


       I t i s suggested t h a t t h i s r e c o g n i t i o n of an
       e q u i t a b l e i n t e r e s t belonging t o t h e p u r c h a s e r
       under a s a l e agreement cannot be r e l i e d on where
       t h e r e p r e v a i l s a land t i t l e s system such a s t h a t
       i n f o r c e i n A l b e r t a . And t h e respondent c i t e s
       S e c t i o n 4 1 of The Land T i t l e s Act, A l b e r t a , 1906,
       ch. 24, under which, a f t e r a c e r t i f i c a t e of
       t i t l e has been g r a n t e d f o r any l a n d , "no
       i n s t r u m e n t u n t i l r e g i s t e r e d under t h i s Act s h a l l
       be e f f e c t u a l t o p a s s any e s t a t e o r i n t e r e s t i n
       any land. "
        I t would p r o b a b l y be s u f f i c i e n t t o s a y t h a t
        S e c t i o n 4 1 i s mainly intended f o r t h e p r o t e c t i o n
        of t h i r d p a r t i e s who have o b t a i n e d r e g i s t r a t i o n
        and t h a t t h e respondent claiming under her
        f a t h e r ' s w i l l is n o t i n a b e t t e r p o s i t i o n than
        t h e l a t t e r would have been t o contend t h a t an
        e q u i t a b l e i n t e r e s t d i d n o t pass t o Lockerbie
        under t h e s a l e agreement. By g i v i n g t o S e c t i o n
        4 1 and s i m i l a r p r o v i s i o n s f u l l e f f e c t f o r t h e
        p r o t e c t i o n of t h i r d p a r t i e s who have complied
        w i t h t h e A c t , it d o e s n o t a p p e a r p o s s i b l e , and
        c e r t a i n l y n o t i n t e r p a r t e s , t o e x c l u d e from
        The Land T i t l e s Act e q u i t a b l e i n t e r e s t s i n
        p r o p e r t y r e s u l t i n g from s a l e agreements.

        While I d l i n g t o n J. was r e f e r r i n g t o t h e e q u i t a b l e i n t e r e s t
c r e a t e d by a c o n t r a c t of s a l e , it i s a l s o t r u e t h a t a conveyance
which compli-es w i t h t h e S t a t u t e of F r a u d s ( i . e . , i n d i c a t e s
an i n t e n t i o n t o v e s t i m m e d i a t e l y t i t l e i n t h e t r a n s f e r e e and
which a c c u r a t e l y d e s c r i b e s t h e p r o p e r t y ) b u t which d o e s n o t
comply w i t h The Land T i t l e s Act ( e i t h e r b e c a u s e of n o n - r e g i s t r a -
t i o n o r because t h e i n s t r u m e n t i s n o t i n s t a t u t o r y form) a l s o
t r a n s f e r s an i n t e r e s t i n l a n d as between t h e immediate p a r t i e s
t o t h e t r a n s a c t i o n : J e l l e t t v. W i l k i e (1896) 2 6 S.C.R. 282.

       The l e g a l e f f e c t i v e n e s s of a conveyance w i l l be a t i s s u e
 i n two d i f f e r e n t c o n t e x t s : a ) where a conveyance h a s been
 a l l e g e d p u r s u a n t t o a c o n t r a c t t o convey, and, b ) where a
 conveyance h a s been a l l e g e d by way of a g i f t .

      I f a conveyance h a s been a l l e g e d p u r s u a n t t o a c o n t r a c t
 which i s e n f o r c e a b l e ( e i t h e r because t h e r e i s a s u f f i c i e n t
 memorandum or b e c a u s e t h e r e are s u f f i c i e n t a c t s of p a r t
 performance) tlie i s s u e of an a l l e g e d conveyance complying w i t h
 S e c t i o n s 1 and 3 w i l l n o t n o r m a l l y arise, s i n c e an o r d e r f o r
 s p e c i f i c performance c o u l d be o b t a i n e d under t h e c o n t r a c t .
 I f a conveyance h a s been a l l e g e d p u r s u a n t t o a v a l i d b u t
 u n e n f o r c e a b l e c o n t r a c t , t h e i s s u e of compliance w i t h S e c t i o n s
 1 and 3 of t h e S t a t u t e , and p o s s i b l y w i t h S e c t i o n 56 of The
 Land T i t l e s Act, w i l l a r i s e . T h i s i s so, b e c a u s e i f t h e r e h a s
 been an e f f e c t i v e conveyance under an u n e n f o r c e a b l e c o n t r a c t
 a n a t t e m p t t o g e t t h e l a n d reconveyed can be m e t by t h e
 d e f e n c e t h a t t h e l a n d was conveyed p u r s u a n t t o a v a l i d
 conveyance.              I n o r d e r f o r t h i s d e f e n c e t o p r e v a i l t h e r e must,
 o f c o u r s e , be an e f f e c t i v e conveyance. An e f f e c t i v e convey-
 a n c e f o r t h i s p u r p o s e would be one complying w i t h t h e S t a t u t e
of Frauds and, p o s s i b l y , with t h e f o r m a l i t i e s p r e s c r i b e d i n
The Land T i t l e s Act.

        I n t h e c a s e of a conveyance made by way of g i f t , compli-
ance w i t h t h e r e q u i s i t e f o r m a l i t i e s would seem t o be necessary
f o r t h e p e r f e c t i o n of t h e g i f t .   Thus an o r a l conveyance with
a t a k i n g of p o s s e s s i o n by t h e donee i s i n s u f f i c i e n t .

       There i s however, one e x c e p t i o n t o t h e r u l e t h a t t h e r e
cannot be an o r a l conveyance.                   I f a donee who has taken
p o s s e s s i o n of l a n d i n r e l i a n c e on an a l l e g e d g i f t t o him, has
expended money, such a s i n c o n s t r u c t i o n of a b u i l d i n g , e q u i t y
would recognize t h e t i t l e of t h e donee. This d o c t r i n e , while
analogous t o p a r t performance, i s i n f a c t based upon e s t o p p e l .
- s e e Dillwyn v. Llewelyn ( 1 8 6 2 ) , 4 De. G.F. & J. 517;
Campbell v. Campbell, [1932] 3 D.L.R.       501 (N.S.S.C.) ; Brogden
v. Brogden ( 1 9 2 0 ) , 53 D.L.R. 362 (Alta. A.D.)                       .
        Given o u r recommendation t h a t t h e r e should be f o r m a l i t i e s
i n r e s p e c t of c o n t r a c t s concerning land we can s e e no reason
f o r p e r m i t t i n g o r a l conveyances i n performance of c o n t r a c t s .
I f t h e c o n t r a c t i s e n f o r c e a b l e e q u i t y w i l l e n f o r c e t h e con-
t r a c t i n any e v e n t .     I f the contract is not enforceable
p e r m i t t i n g o r a l conveyances could r e s u l t i n a s i t u a t i o n where
a p a r t y could s u c c e s s f u l l y claim t i t l e t o land n o t on t h e
b a s i s of c o n t r a c t b u t on t h e b a s i s of a s u c c e s s f u l o r a l con-
veyance. W t h i n k t h a t such a claim should be based upon
                e
proof of t h e c o n t r a c t e i t h e r by v i r t u e of a w r i t i n g o r a c t s of
p a r t performance.           Consistency t h u s demands t h a t i n t h e c a s e
of conveyances p u r s u a n t t o a c o n t r a c t t o convey t h e r e should
be a requirement of w r i t i n g .

        I n t h e c a s e of o r a l conveyances a l l e g e d l y made by way of
g i f t t h e r e a r e d i f f e r e n t p o l i c y c o n s i d e r a t i o n s . The r e a l
i s s u e h e r e i s what f o r m a l i t i e s , i f any, should be necessary t o
p e r f e c t a g i f t of l a n d , o r of an i n t e r e s t in land.              One p o i n t
of view, expressed by t h e B r i t i s h Columbia Law Reform Commis-
s i o n , a t page 1 1 7 of i t s Working Paper, i s t h a t t h e r e should
be no s t a t u t o r y f o r m a l i t i e s i n r e s p e c t of g i f t s of land. The
Commission argued t h a t such g i f t s a r e o f t e n made i n circum-
s t a n c e s where f o r m a l i t i e s a r e n o t observed, e.g.            between
f a m i l y members and t h a t t h e common law requirements of a g i f t ,
i . e . c l e a r evidence of t h e d o n o r ' s i n t e n t i o n and a c t u a l o r
c o n s t r u c t i v e d e l i v e r y , c l e a r l y s a t i s f y any e v i d e n t i a r y
objectives.


       There a r e however, s t r o n g arguments t o be made i n f a v o r
of f o r m a l i t i e s i n t h e c a s e of g i f t s of land.      F i r s t , the
requirement of a c t u a l o r c o n s t r u c t i v e d e l i v e r y i s a somewhat
e l u s i v e e v i d e n t i a r y p r o t e c t i o n when t h e p a r t i e s may a t t h e
time of t h e a l l e g e d d e l i v e r y a l r e a d y be l i v i n g t o g e t h e r on
t h e same p i e c e of land.            I n such c a s e s a l l e g a t i o n s of con-
s t r u c t i v e d e l i v e r y a r e e a s i l y made and d i f f i c u l t t o d i s p r o v e .
Second, it i s a r g u a b l e t h a t t h e c a u t i o n a r y purpose of a
f o r m a l i t y i s even more i m p o r t a n t in t h e c a s e of a g r a t u i t o u s
d i s p o s i t i o n t h a n i n t h e c a s e of a c o n t r a c t . I n t h e c a s e of a
                                                       e
g i f t t h e donor has more t o l o s e . W i n v i t e comment on t h e
following questions :


QUESTION 1 2


        Should a conveyance p u r s u a n t t o a c o n t r a c t t o convey
        be r e q u i r e d t o be i n w r i t i n g ?


QUESTION 13
                                                                   1


        Should a conveyance by way of g i f t be r e q u i r e d t o be
        i n writing?
B.      S e c t i o n 2 of t h e S t a t u t e of Frauds


        S e c t i o n 2 o f t h e S t a t u t e of F r a u d s p r o v i d e s an e x c e p t i o n
t o t h e r e q u i r e m e n t of w r i t i n g :


        Except n e v e r t h e l e s s a l l l e a s e s n o t e x c e e d i n g
        t h e t e r m of t h r e e y e a r s from t h e making t h e r e o f ,
        whereupon t h e r e n t r e s e r v e d t o t h e l a n d l o r d ,
        d u r i n g such t e r m , s h a l l amount u n t o two t h i r d
        p a r t s a t t h e l e a s t of t h e f u l l improved v a l u e
        of t h e t h i n g demised.
                  '




        Our d i s c u s s i o n of t h i s S e c t i o n b r e a k s down i n t o two
segments, an a n a l y s i s of t h e l a w as w e p r e s e n t l y b e l i e v e it t o
b e , and an e v a l u a t i o n of t h e law.

        1.      A n a l y s i s of t h e Law


        The words " t h r e e y e a r s from t h e making t h e r e o f              'I   have
been i n t e r p r e t e d a s meaning t h a t a p a r t i c u l a r c a s e w i l l be
w i t h i n t h e e x c e p t i o n u n l e s s it must of n e c e s s i t y l a s t f o r more
than t h r e e years.        -     R e Knight, Ex P a r t e Voisey (1882) , 21 Ch.
D. 422.         I t would seem t o f o l l o w t h a t a lease f o r less t h a n
t h r e e y e a r s w i t h a n o p t i o n t o renew would f i t w i t h i n t h e
e x c e p t i o n , and it w a s so h e l d i n Le C o r p o r a t i o n E p i s c o p a l e
D e S t . A l b e r t v. Sheppard & Co. ( 1 9 1 3 ) , 3 W.W.R.            814 ( A l t a .
S.C.) , r e l y i n g on t h e E n g l i s h Court of Appeal d e c i s i o n i n
-            -
Hand v. H a l l ( 1 8 7 7 ) , 2 Ex. D. 355. However, it w a s d e c i d e d
                                                                       -
t o t h e c o n t r a r y i n t h e more r e c e n t c a s e of P a i n v. Dixon,
[1923], 3 D.L.R.            1167 (Ont. S.C.),             r e l y i n g on t h e Exchequer
                                  -
D i v i s i o n d e c i s i o n i n Hand v. H a l l ( 1 8 7 7 ) , 2 Ex. D.           318.        The
former p o s i t i o n i s p r o b a b l y c o r r e c t .

        W e n o t e t h a t S e c t i o n 97 of The Land T i t l e s Act p r o v i d e s
a n e x c e p t i o n t o r e g i s t r a t i o n f o r a lease " f o r a term of more
t h a n t h r e e y e a r s " whereas S e c t i o n 2 of t h e S t a t u t e of F r a u d s
p r o v i d e s an e x c e p t i o n f o r " a l l l e a s e s n o t e x c e e d i n g t h e t e r m
of t h r e e y e a r s from t h e making t h e r e o f . "            Hence, f o r t h e
purpose of t h e S t a t u t e of Frauds,                 it i s n o t t h e l e n g t h of t h e
l e a s e which i s r e l e v a n t , b u t r a t h e r t h e l e n g t h of time between
t h e making of t h e c o n t r a c t and t h e t e r m i n a t i o n of t h e l e a s e .
A l e a s e t o l a s t f o r t h r e e y e a r s and t o b e g i n a t a d a t e sub-
s e q u e n t t o t h e f o r m a t i o n of t h e c o n t r a c t i s t h e r e f o r e r e q u i r e d
t o be i n w r i t i n g    -
                          F o r s t e r v. Reeves, 118921 2 Q.B. 255 (C.A.)
-  b u t r a t h e r anomalously would be exempt from r e g i s t r a t i o n
under The Land T i t l e s A c t .


        I n a d d i t i o n t o b e i n g n o t more t h a n three y e a r s , it i s
n e c e s s a r y t h a t t h e r e n t be " t w o - t h i r d p a r t s a t t h e l e a s t of
t h e f u l l improved v a l u e of t h e t h i n g demised" t o a v o i d t h e
r e q u i r e m e n t of w r i t i n g . There a r e t h r e e p o s s i b l e i n t e r p r e t a -
t i o n s on t h i s c l a u s e .


        Under t h e f i r s t i n t e r p r e t a t i o n t h e c l a u s e i s t a k e n i n i t s
l i t e r a l s e n s e , s o t h a t t h e r e n t must be e q u a l t o t w o - t h i r d s of
t h e f a i r market v a l u e of t h e land.                Support f o r t h i s i n t e r p r e -
t a t i o n can be found i n Cody v. Quarterman (1853) , 12 GA. 386,
399.      T h i s i n t e r p r e t a t i o n i s however, a b i t u n r e a s o n a b l e .       To
f i t w i t h i n t h e e x c e p t i o n , t h e r e n t must be a t l e a s t t w o - t h i r d s
of t h e v a l u e of t h e l a n d and t h i s would mean t h a t v i r t u a l l y no
l e a s e would m e e t t h e r e q u i r e m e n t s .      Even i f t h i s c l a u s e w e r e
r e a d a s meaning t h a t a r e n t of t w o - t h i r d s          of t h e v a l u e of t h e
l a n d must be p a i d i n t o t a l o v e r a t h r e e - y e a r         period,      this
would n o t make s e n s e from a commercial p o i n t of view.


        The second i n t e r p r e t a t i o n i s t h a t t h e r e n t must e q u a l a t
l e a s t t w o - t h i r d s of t h e a n n u a l v a l u e of t h e land.           Several
a u t h o r i t i e s r e f e r t o S e c t i o n 2 a s r e q u i r i n g a l e a s e of n o t
more t h a n three y e a r s a t g r e a t e r t h a n t w o - t h i r d s        of " r a c k
rent".       -     see C h i t t y on C o n t r a c t s 84 ( 1 6 t h ed., 1 9 1 2 ) ; 18
H a l s b u r y ' s Laws o f England 384 (1st ed., 1 9 1 1 ) ; Suqden on
Vendors and P u r c h a s e r s 175 ( 1 4 t h ed.,              1873).       "Rack r e n t " i s
d e f i n e d i n E l p h i n s t o n e , Rules f o r t h e I n t e r p r e t a t i o n of Deeds
618 a s " r e n t of o r approaching t o t h e f u l l annual v a l u e of t h e
p r o p e r t y o u t of which it i s s u e s . " The Nova S c o t i a S t a t u t e of
Frauds, R.S.N.S.    1967 c . 290 s. 2 a l s o p r o v i d e s an e x c e p t i o n
t o t h e requirement of w r i t i n g when t h e time of t h e l e a s e does
n o t exceed t h r e e y e a r s "whereupon t h e r e n t r e s e r v e d amounts t o
two-thirds a t t h e l e a s t of t h e annual v a l u e of t h e land
demised. I'


       The t h i r d i n t e r p r e t a t i o n i s t h a t a c c e p t e d most f r e q u e n t l y
by t h e American a u t h o r i t i e s : The p r o v i s o t h a t t h e r e n t
r e s e r v e d i n such l e a s e s must amount t o ' t w o - t h i r d s         a t the
l e a s t of t h e t h i n g demised' r e f e r s t o t w o - t h i r d s of t h e r e n t a l
v a l u e and n o t of t h e f e e        -
                                   Page on t h e Law of C o n t r a c t s 2187
(2nd ed., 1920)          .
                         According t o B l a c k ' s Law D i c t i o n a r y 1 4 6 1
( 4 t h ed.,    1968) a t p.         1461, " r e n t a l v a l u e " i s

        t h e v a l u e of l a n d f o r use f o r purposes f o r which
        it i s adapted i n t h e hands of a prudent occupant
        ..  . f a i r r e n t a l v a l u e of l a n d , but n o t t h e con-
        j e c t u r a l o r probable p r o f i t s t h e r e of...

I t i s impossible t o say which of t h e s e t h r e e i n t e r p r e t a t i o n s
p r o p e r l y e x p r e s s e s t h e law i n A l b e r t a .

        A f u r t h e r problem e x i s t s i n d e t e r m i n i n g t o which s e c t i o n s
t h e p r o v i s i o n s of S e c t i o n 2 p r o v i d e an e x c e p t i o n . Read l i t e r -
a l l y , t h e w r d s "except n e v e r t h e l e s s " f o l l o w i n g immediately
a f t e r S e c t i o n 1 would seem t o i n d i c a t e t h a t it a p p l i e s only t o
t h e p r o v i s i o n s of S e c t i o n 1.     This i s t h e view taken by L e i t h
and Smith, B l a c k s t o n e ' s Commentaries Adapted t o t h e P r e s e n t
S t a t e of t h e Law i n O n t a r i o , 2nd Edn.,              1880, page 357:
        I t w i l l be observed, t h i s e x c e p t i o n t o t h e
        o p e r a t i o n of S e c t i o n 1 does n o t apply t o
        S e c t i o n 4 ; so t h a t t h e r e i s t h i s s i n g u l a r i t y ;
        t h a t a l e a s e n o t exceeding t h r e e y e a r s a t such
        a r e n t , i f a c t u a l l y made ,- s good-by p a r o l ,
                                                 i
        w h i l s t a p a r 0 1 asreement f o r such a l e a s e i s
       void a s a g a i n s t t h e p a r t y making it. This i s
       t h e r e v e r s e of t h e p o l i c y of t h e l e g i s l a t u r e ,
       which was t o p l a c e t h e a c t u a l c r e a t i o n of an
       i n t e r e s t on a - h i g h e r f o o t i n g t h a n an agreement
       f o r i t s c r e a t i o n ; t h u s , i n t h e l a t t e r c a s e , it
       w i l l be seen t h e y r e q u i r e d only v e r b a l a u t h o r i t y
       t o t h e a g e n t , b u t i n t h e former a w r i t t e n one.

       However, a c o n t r a r y p o s i t i o n was taken i n t h e c a s e of
Lord Bolton v. Tomlin (1836) 5 Ad. & E. 856, 1 1 E.R.
                                              1                                       1391.
The c a s e concerned a p a r o l l e a s e f o r a term of l e s s than t h r e e
years.        I n a d d i t i o n t o t h e l e a s e , t h e p a r t i e s a l s o agreed t o
c e r t a i n c o n d i t i o n s which were n o t t o be performed w i t h i n one
y e a r from t h e making t h e r e o f       (Section 4 S t a t u t e of F r a u d s ) .
The l e a s e was e n f o r c e a b l e s i n c e it was o b v i o u s l y excepted from
t h e S t a t u t e by S e c t i o n 2, b u t t h e i s s u e a r o s e a s t o whether
S e c t i o n 2 a l s o e x c e p t e d t h e c o n t r a c t u a l covenants. Lord
Denman, C . J . h e l d , a t page 1394, t h a t it would be f o o l i s h t o
e n f o r c e t h e l e a s e and n o t e n f o r c e t h e covenants;


        .. . l e a s e s n o t exceeding t h r e e y e a r s have always
       been c o n s i d e r e d a s excepted by t h e second s e c t i o n
       from t h e o p e r a t i o n of t h e f o u r t h ; and it seems
       absurd t o s a y t h a t a p a r o l l e a s e s h a l l be good,
       and y e t t h a t it c a n n o t c o n t a i n any s p e c i a l s t i p u -
       l a t i o n s o r agreements...

       Whether S e c t i o n 2 i s a l s o an e x c e p t i o n t o s e c t i o n 3
(which r e q u i r e s assignments o r s u r r e n d e r s of l e a s e s t o be in
writing) is also uncertain.                    Taken in a l i t e r a l s e n s e , t h e r e
i s no reason why S e c t i o n 2 should be an e x c e p t i o n t o S e c t i o n
3. S e c t i o n 2 o n l y r e f e r s t o " a l l l e a s e s " ; it makes no mention
of t r a n s f e r s o r s u r r e n d e r s of l e a s e s . However, i n 18 Hals-
b u r y ' s Laws of England 546 (1st Ed.,                 1 9 1 1 ) it i s implied t h a t
S e c t i o n 2 i s an e x c e p t i o n t o S e c t i o n 3 by t h e s t a t e m e n t t h a t
t h e s u r r e n d e r of a l e a s e n o t exceeding t h r e e y e a r s a t a r e n t
g r e a t e r than t w o - t h i r d s r a c k r e n t need n o t be evidenced by
deed.  (See t h e d i s c u s s i o n of t h e Real P r o p e r t y Amendment Act,
(1845) 8 & 9 V i c t . c . 106 i n t h e s e c t i o n immediately following.)
        2.     E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform


        The main r a t i o n a l e f o r e x c e p t i n g l e a s e s under t h r e e y e a r s
from t h e r e q u i r e m e n t of w r i t i n g (and from r e g i s t r a t i o n under
The Land T i t l e s A c t ) i s t h a t because of t h e i r r e l a t i v e l y s h o r t
d u r a t i o n t h e y a r e less s i g n i f i c a n t , and because many such
l e a s e s would p r o b a b l y n o t comply w i t h t h e r e q u i r e d f o r m a l i t i e s
( t h u s c a u s i n g a n u n a c c e p t a b l e amount of h a r d s h i p ) .    W e can see
no j u s t i f i c a t i o n f o r r e p e a l i n g t h i s e x c e p t i o n .

        The r e q u i r e m e n t t h a t i n o r d e r t o f a l l w i t h i n t h e excep-
t i o n t h e l e a s e must be performed w i t h i n t h r e e y e a r s from t h e
making t h e r e o f i s a r c h a i c and n o t i n c o n f o r m i t y w i t h The Land
T i t l e s A c t e x c e p t i o n (which i s based on t h e t e r m of t h e l e a s e ) .
W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n .


QUESTION 1 4


        Should t h e r e be an e x c e p t i o n f o r l e a s e s under 3 y e a r s ?
        and i f so, s h o u l d such e x c e p t i o n be f o r l e a s e s of a
        t e r m of t h r e e y e a r s o r less, r e g a r d l e s s of t h e time
        d i f f e r e n t i a l between t h e making of t h e l e a s e and i t s
        completion?


        W e have s t a t e d t h a t t h e b e t t e r view of t h e law i s t h a t
o p t i o n s t o renew a r e n o t c o n s i d e r e d i n d e t e r m i n i n g t h e d e f i n i -
t i o n a l q u e s t i o n o f whether a p a r t i c u l a r l e a s e i s under three
years.        C e r t a i n l y , from a commercial p o i n t of view, s h o r t t e r m
leases w i t h o p t i o n s t o renew a r e more s i g n i f i c a n t t h a n t h o s e
w i t h o u t such o p t i o n s , and t h u s p e r h a p s w a r r a n t more c a u t i o n a r y
and e v i d e n t i a r y p r o t e c t i o n . However, i f such o p t i o n s t o renew
a r e widespread t h e i n c l u s i o n of t h e o p t i o n p e r i o d i n t h e
c a l c u l a t i o n of t i m e would s e r i o u s l y d e t r a c t from t h e e f f i c a c y
of t h e e x c e p t i o n .    W e i n v i t e comments on t h e f o l l o w i n g
question.
QUESTION 15


       Should t h e time p e r i o d f o r determining whether a
       l e a s e i s excepted i n c l u d e p o s s i b l e f u r t h e r terms
       which may a r i s e by reason of t h e e x e r c i s i n g of an
       o p t i o n t o renew?


       The p r e s e n t r e q u i r e m e n t t h a t o n l y l e a s e s of a c e r t a i n
v a l u e , whichever i n t e r p r e t a t i o n of "two-thirds of f u l l
improved v a l u e " i s a c c e p t e d , i s a r c h a i c , n o t i n conformity
w i t h The Land T i t l e s Act, and impossible t o determine in
              e
advance. W s e e no r e a s o n f o r r e t a i n i n g t h i s c r i t e r i o n .


QUESTION 1 6


        Should t h e r e be a c r i t e r i o n f o r e x c e p t i n g s h o r t
        term l e a s e s based on p r o p e r t y o r r e n t a l v a l u e ?

        e
       W have noted t h e p r e s e n t u n c e r t a i n t y i n t h e law about
whether agreements t o l e a s e and c o n t r a c t u a l covenants a r e a l s o
excepted by S e c t i o n 2.          I t does seem anomalous t h a t a par01
l e a s e may be e n f o r c e a b l e y e t covenants i n t h a t l e a s e may n o t
          e
be. W i n v i t e comment on t h e f o l l o w i n g q u e s t i o n .

OUESTION 17


        Should agreements t o l e a s e and c o n t r a c t u a l
       covenants i n a l e a s e be excepted from t h e r e q u i r e -
       ment of w r i t i n g where such l e a s e s would be excepted?


          There i s a l s o u n c e r t a i n t y about whether assignments o r
s u r r e n d e r s of l e a s e s a r e excepted a t p r e s e n t .           e
                                                                              W can see no
m a t e r i a l c o n c e p t u a l d i s t i n c t i o n between a c r e a t i o n of a l e a s e
of l e s s t h a n t h r e e y e a r s and an assignment o r s u r r e n d e r of
such a l e a s e .         Both i n v o l v e t h e t r a n s f e r of a s h o r t term
l e a s e h o l d e s t a t e ; it i s o n l y t h e l e g a l mechanism by which such
an e s t a t e i s t r a n s f e r r e d t h a t i s d i f f e r e n t .


          I f t h e r e i s t o be an e x c e p t i o n f o r t r a n s f e r s o r s u r r e n -
d e r s of l e a s e s t h e proper c r i t e r i o n i s probably t h e unexpired
p o r t i o n of t h e l e a s e which i s being t r a n s f e r r e d o r s u r r e n d e r e d
and n o t t h e i n i t i a l t e r m of t h e l e a s e .     I f t h e proper c r i t -
e r i o n of s i g n i f i c a n c e i s t h e t e r m of y e a r s being t r a n s f e r r e d
t h e n an assignment of a l e a s e i n i t i a l l y made f o r f i v e y e a r s ,
w i t h two y e a r s t o run a t t h e time of assignment, should be
j u s t a s m e r i t o r i o u s of e x c e p t i o n a s an i n i t i a l c r e a t i o n of a
l e a s e f o r two y e a r s .       e
                                     W i n v i t e comment on t h e f o l l o w i n g
question.


OUESTION 18


        Should t h e e x c e p t i o n f o r l e a s e s apply t o assignments
        and s u r r e n d e r s of l e a s e s and t o agreements t o a s s i g n
        and s u r r e n d e r l e a s e s , and i f so, should t h e proper
        c r i t e r i o n i n t e r m s of time be t h e unexpired p o r t i o n
        of t h e l e a s e so a s s i g n e d o r s u r r e n d e r e d ?

C.      S e c t i o n 3 of t h e Real P r o p e r t y Amendment Act

        S e c t i o n 3 of t h e Real P r o p e r t y Amendment Act (1845) 8                   &   9
V i c t . c. 106 r e a d s :

        Be it enacted by t h e Queen's most E x c e l l e n t
        Majesty, by and w i t h t h e Advice and Consent of
        t h e Lords S p i r i t u a l and Temporal, and Commons,
        i n t h i s p r e s e n t P a r l i a m e n t assembled, and by
        t h e A u t h o r i t y of t h e same, a s follows; ( t h a t
        is t o say,)
        111. That a Feoffment, made a f t e r t h e s a i d
        F i r s t Day of October, One thousand e i g h t
        hundred and f o r t y f i v e , o t h e r than a Feoffment
        made under a Custom by an I n f a n t , s h a l l be
        void a t Law, u n l e s s evidenced by Deed; and
       t h a t a P a r t i t i o n , and an Exchange, of any
       Tenements o r Hereditaments, n o t being Copyhold,
       and a Lease, r e q u i r e d by Law t o be i n Writing,
       of any Tenements o r Hereditaments, and an
       Assignment of a C h a t t e l I n t e r e s t , n o t being
       Copyhold, i n any Tenements o r Hereditaments,
       and a S u r r e n d e r i n Writing of an I n t e r e s t i n
       any Tenements o r Hereditaments, n o t being a
       Copyhold I n t e r e s t , and n o t being an I n t e r e s t
       which might by Law have been c r e a t e d w i t h o u t
       Writing, made a f t e r t h e s a i d F i r s t Day of October
       One thousand e i g h t hundred and f o r t y - f i v e , s h a l l
       a l s o be void a t Law, u n l e s s made by Deed:
       Provided always, t h a t t h e s a i d Enactment so
       f a r a s t h e same r e l a t e s t o a Release o r a
       Surrender s h a l l n o t extend t o I r e l a n d .

     The e f f e c t of t h i s S e c t i o n with r e g a r d t o t h e S t a t u t e of
Frauds i s t o r e q u i r e a deed f o r l e a s e s r e q u i r e d by law t o be
i n w r i t i n g , f o r a s s i g n m e n t s of l e a s e s , whether o r n o t t h e
l e a s e i s r e q u i r e d by law t o be in w r i t i n g , and f o r s u r r e n d e r s
of i n t e r e s t s , f r e e h o l d o r l e a s e h o l d , r e q u i r e d by law t o be i n
writing.


        Although a l e a s e exceeding t h r e e y e a r s o r a t a r e n t of
l e s s t h a n t m - t h i r d s of t h e f u l l and proved v a l u e of t h e land
which i s n o t made by deed i s void, it w i l l be c o n s t r u e d a s
an agreement f o r a l e a s e .            --
                                 Bond v. ~ o s l i n g (1861) , 1 B. C
S. 371.   See a l s o Rogers v. N a t i o n a l Drug C Chemical Co. ( 1 9 1 1 1 ,
24 O.L.R.       486 (Ont. C.A.)             and Gebler v. Palmason [1930], 1 D.L.R.
475 (Man. C.A.)          .
       The d i f f e r e n c e between a l e a s e and an agreement f o r a l e a s e
i s s e t o u t i n 18 H a l s b u r y ' s Laws of England 366 (1st Ed., 1911):


       An i n s t r u m e n t by which t h e c o n d i t i o n s of a
        c o n t r a c t of l e t t i n g a r e f i n a l l y a s c e r t a i n e d ,
        and which i s i n t e n d e d t o v e s t t h e r i g h t of
        exclusive possession i n the lessee--either
        a t once, i f t h e term i s t o commence immed-
        i a t e l y , o r a t a f u t u r e d a t e , i f t h e term i s
        t o commence subsequently--is a l e a s e ; it i s
        s a i d t o o p e r a t e by way of a c t u a l demise, and
       when t h e lessee h a s e n t e r e d under it t h e r e l a -
       t i o n of l a n d l o r d and t e n a n t i s f u l l y c r e a t e d .
       An i n s t r u m e n t which o n l y b i n d s t h e p a r t i e s , t h e
       one t o c r e a t e and t h e o t h e r t o a c c e p t a l e a s e
       h e r e a f t e r , i s a n agreement f o r a l e a s e , and
       a l t h o u g h t h e i n t e n d i n g lessee e n t e r s , t h e l e g a l
       r e l a t i o n of l a n d l o r d and t e n a n t is n o t c r e a t e d
       u n l e s s he a l s o pays r e n t , i n which c a s e he
       becomes t e n a n t from y e a r t o y e a r , upon t h e t e r m s
       of t h e agreement s o f a r a s a p p l i c a b l e t o a
       y e a r l y tenancy.          I f , however, a q u e s t i o n of t h e
       l e g a l r i g h t s and l i a b i l i t i e s of t h e p a r t i e s
       a r i s e s i n a c o u r t which h a s j u r i s d i c t i o n t o
       o r d e r s p e c i f i c performance of t h e agreement,
       and i f t h e agreement is one of which s p e c i f i c
       performance w i l l be o r d e r e d , t h e n t h e p a r t i e s
       a r e t r e a t e d a s having t h e same r i g h t s and a s
       b e i n g s u b j e c t t o t h e same l i a b i l i t i e s a s i f t h e
       l e a s e had been g r a n t e d ; c o n s e q u e n t l y t h e l e s s o r
       i s e n t i t l e d t o d i s t r a i n , and t h e lessee, on t h e
       o t h e r hand, i s e n t i t l e d t o h o l d f o r t h e a g r e e d
       term.

        By t h u s t r e a t i n g l e a s e s which do n o t comply w i t h t h e
above s e c t i o n a s a g r e e m e n t s f o r a l e a s e e q u i t y can e n f o r c e
s u c h "agreements".            A s a r e s u l t t h e e f f e c t of S e c t i o n 3 of t h e
Real P r o p e r t y Amendment A c t h a s been l a r g e l y n u l l i f i e d .


       By S e c t i o n 97 o f The Land T i t l e s A c t l e a s e s f o r a t e r m of
more t h a n t h r e e y e a r s must be e x e c u t e d in a p r e s c r i b e d form.
                               OM
The p r e s c r i b e d form, F R 16, i s n o t t h a t of a deed.         Thus it
i s p o s s i b l e t o comply w i t h The Land T i t l e s A c t and n o t t h e
R e a l P r o p e r t y Amendment A c t .         W e can see no u s e f u l purpose in
t h e requirement of S e c t i o n 3 of t h e Real P r o p e r t y Amendment
A c t t h a t a s s i g n m e n t s of l e a s e s and l e a s e s which a r e r e q u i r e d
t o be i n w r i t i n g must be by way of deed.

QUESTION 19

       Should a s s i g n m e n t s of l e a s e s and l e a s e s which a r e
       r e q u i r e d t o be i n w r i t i n g a l s o be r e q u i r e d t o be
       i n t h e form of a deed?
                                     CHAPTER V I
                                               OD
                    CONTRACTS FOR THE SALE OF G O S

     S e c t i o n 7 of t h e S a l e of Goods Act, R.S.A.                1970, c. 327
provides :


      (1) A c o n t r a c t f o r t h e s a l e of any goods of
          t h e v a l u e of f i f t y d o l l a r s o r upwards i s
          n o t e n f o r c e a b l e by a c t i o n

             (a)     u n l e s s t h e buyer a c c e p t s p a r t of
                     t h e goods so sold and a c t u a l l y
                     r e c e i v e s t h e same, o r g i v e s some-
                     t h i n g in e a r n e s t t o bind t h e c o n t r a c t
                     o r i n p a r t payment, o r
             (b)     u n l e s s some note o r memorandum i n
                     w r i t i n g of t h e c o n t r a c t i s made and
                     signed by t h e p a r t y t o be charged o r
                     h i s agent i n t h a t behalf.
             The p r o v i s i o n s of t h i s s e c t i o n apply t o
             e v e r y such c o n t r a c t n o t w i t h s t a n d i n g t h a t
             t h e goods may be intended t o be d e l i v e r e d
             a t some f u t u r e time, o r may n o t , a t t h e
             time of t h e c o n t r a c t , be a c t u a l l y made,
             procured o r provided o r f i t o r ready f o r
             d e l i v e r y o r t h a t some a c t may be r e q u i s i t e
             f o r t h e making o r completing t h e r e o f o r
             r e n d e r i n g t h e same f i t f o r d e l i v e r y .
      (3)    There i s a n acceptance of goods w i t h i n t h e
             meaning of t h i s s e c t i o n when t h e buyer does
             any a c t , i n r e l a t i o n t o t h e goods, t h a t
             r e c o g n i z e s a p r e - e x i s t i n g c o n t r a c t of s a l e
             whether t h e r e i s an acceptance i n performance
             of t h e c o n t r a c t o r n o t ,


      This i s a r e v i s e d v e r s i o n of S e c t i o n 1 6 of t h e S t a t u t e of
Frauds a s amended by S e c t i o n 7 of Lord T e n t e r d e n ' s Act (1828)
9 Geo, 4 , c, 1 4 .


      A s i s t h e c a s e w i t h S e c t i o n 4 of t h e S t a t u t e of Frauds
non-compliance w i t h S e c t i o n 7 of t h e S a l e of Goods Act w i l l
r e s u l t i n a c o n t r a c t being merely unenforceable and n o t void.
78
  e
W r e f e r t h e r e a d e r t o o u r d i s c u s s i o n i n c h a p t e r IV of t h e
l e g a l i m p l i c a t i o n s of "mere" u n e n f o r c e a b i l i t y .

       Unlike S e c t i o n 4 of t h e S t a t u t e of Frauds S e c t i o n 7 of
t h e S a l e of Goods Act s t i p u l a t e s t h r e e a l t e r n a t e means of
compliance:


       1)      A note o r memorandum of t h e c o n t r a c t signed
               by t h e p a r t y t o be charged:

       2)      r e c e i p t and a c c e p t a n c e of t h e goods by t h e
               buyer ;

       3)      t h e g i v i n g by t h e buyer of "something i n
               e a r n e s t " o r in p a r t payment.

       The "note o r memorandum" requirement i s p r e c i s e l y t h e
same a s t h a t f o r c o n t r a c t s i n r e l a t i o n t o land. Thus w e w i l l
n o t r e p e a t our a n a l y s i s of t h a t requirement here.

       Our review of t h i s s e c t i o n s h a l l c o n s i s t f i r s t , of an
a n a l y s i s of t h e two o t h e r methods of compliance.                     Then we
s h a l l c o n s i d e r what t y p e s of c o n t r a c t s f a l l w i t h i n t h e meaning
of t h e words, " c o n t r a c t f o r t h e s a l e of any goods of t h e v a l u e
of f i f t y d o l l a r s o r upwards. " F i n a l l y , we s h a l l examine
whether t h i s s e c t i o n should be r e p e a l e d and some measures of
law reform f a l l i n g s h o r t of r e p e a l .


A.     Receipt and Acceptance of t h e Goods


       S e c t i o n 7 ( 3 ) d e f i n e s acceptance :

       There i s an a c c e p t a n c e of goods w i t h i n t h e
       meaning of t h i s s e c t i o n when t h e buyer does
       any a c t , i n r e l a t i o n t o t h e goods, t h a t
       r e c o g n i z e s a p r e - e x i s t i n g c o n t r a c t of s a l e
       whether t h e r e i s an acceptance i n performance
       of t h e c o n t r a c t o r n o t .
        This s u b - s e c t i o n i s b a s i c a l l y a c o d i f i c a t i o n of t h e
requirement of a c c e p t a n c e developed by j u d i c i a l i n t e r p r e t a t i o n
of S e c t i o n 7 of Lord T e n t e r d e n ' s Act--see Morton v. Tibbet
(1850) 15 Q.B.          428, Kibble v. Gough ( 1 8 7 8 ) , 38 L.T.                    204 (C.A.).


        A s S e c t i o n 7 ( 3 ) i m p l i e s , acceptance under S e c t i o n 7 i s
d i f f e r e n t from and l e s s t h a n "acceptance i n performance.                       It

Acceptance i n performance r e l a t e s o n l y t o t h e buyer' s r i g h t t o
r e j e c t t h e goods f o r b r e a c h of c o n d i t i o n . (Under S e c t i o n
1 4 ( 4 ) of t h e S a l e of Goods Act i f t h e r e has been acceptance i n
performance, t h e n , u n l e s s t h e r e i s a term i n t h e c o n t r a c t t o
t h e c o n t r a r y , t h e buyer i s precluded from r e j e c t i n g t h e goods,
i . e . r e s c i n d i n g t h e c o n t r a c t , and i s t h u s r e l e g a t e d t o a
remedy i n damages. ) S e c t i o n s 35 and 36 of t h e S a l e of Goods
Act r e l a t e t o a c c e p t a n c e i n performance. Under S e c t i o n 35 a
buyer s h a l l n o t be deemed t o have a c c e p t e d t h e goods u n t i l he
h a s had a r e a s o n a b l e o p p o r t u n i t y t o examine them.             Since t h i s
s e c t i o n r e l a t e s o n l y t o acceptance i n performance, it i s
p o s s i b l e f o r t h e r e t o be acceptance w i t h i n t h e s p e c i a l meaning
of t h a t word s e t f o r t h i n S e c t i o n 7 ( 3 ) , even where a buyer
s h a l l n o t be deemed t o have accepted i n performance.                     Section
36 s e t s f o r t h t h r e e s e t s of c i r c u m s t a n c e s i n which a buyer
s h a l l be deemed t o have accepted in performance.                              Briefly,
t h o s e t h r e e s e t s of c i r c u m s t a n c e s a r e e x p r e s s i n t i m a t i o n ,
a c t s i n c o n s i s t e n t w i t h t h e s e l l e r ' s ownership, and l a p s e
of time.          I t i s c l e a r t h a t where a buyer is deemed t o have
accepted i n performance under S e c t i o n 36 t h e r e w i l l a l s o be
acceptance under S e c t i o n 7--Re               A Debtor,        [1938] 4 A l l E.R.              308.
I n s h o r t , while t h e absence of a c c e p t a n c e i n performance does
n o t p r e c l u d e a f i n d i n g of a c c e p t a n c e under S e c t i o n 7, a f i n d i n g
of a c c e p t a n c e i n performance n e c e s s a r i l y i m p l i e s acceptance
under S e c t i o n 7.

        S e c t i o n 7 ( 3 ) s t a t e s t h a t t h e a c t of t h e buyer need o n l y
                -
recognize a pre-existing                 c o n t r a c t and n o t - p r e - e x i s t i n g
                                                                   the
80
 contract.       Hence, t h e r e may be a r e j e c t i o n of t h e goods, but
an a c t so a s t o r e c o g n i z e t h e e x i s t e n c e of a c o n t r a c t and t o
c o n s t i t u t e acceptance. --Abbott         v. Wolsey,        [I8951 2 Q.B.         97.

          S i x p o i n t s w i t h r e g a r d t o t h e requirement of acceptance
w i t h i n S e c t i o n 7 ( 3 ) a r e set o u t i n Benjamin on S a l e , ( 8 t h ed.,
1950) 199:


        1.      I t a d o p t s t h e d i s t i n c t i o n , drawn i n Morton v.
                T i b b e t t , between a p r o v i s i o n a l and a f i n a T
                acceptance;
        2.      There must be an a c t ;

        3.     The a c t may be done, n o t o n l y t o , b u t
               merely i n r e l a t i o n t o , t h e goods;
        4.     The a c c e p t a n c e i s n o t an a c c e p t a n c e of t h e
               goods, b u t o n l y a r e c o g n i t i o n of a c o n t r a c t ;
        5.     The c o n t r a c t must be p r e - e x i s t i n g ;
        6.     Acceptance i s a d i f f e r e n t t h i n g from a c t u a l
               receipt.


        To s a t i s f y t h e S a l e of Goods Act t h e r e must be r e c e i p t
and acceptance. Whereas a c c e p t a n c e r e f e r s t o a c t s done in
r e l a t i o n t o t h e goods, r e c e i p t r e f e r s t o a change i n p o s s e s s i o n ,
 i.e.   delivery--Blackburn            on S a l e (3rd ed.,            1910) 38.      I n most
 c a s e s , whether t h e r e h a s been d e l i v e r y w i l l be r e l a t i v e l y
e a s y t o determine.        There a r e however, some f a c t s i t u a t i o n s
which r a i s e s p e c i a l problems.

        The f i r s t i s where p r i o r t o t h e c o n t r a c t of s a l e t h e
goods a r e a l r e a d y i n t h e b u y e r ' s p o s s e s s i o n a s b a i l e e f o r t h e
 s e l l e r . The t e s t f o r r e c e i p t i n such c a s e is set o u t i n
 L i l l y w h i t e v. Devereaux (1846), 15 M. & W. 285, a s summarized
 i n Benjamin on S a l e , 208:
        ...         i f it a p p e a r s t h a t t h e conduct of a defen-
        d a n t i n d e a l i n g w i t h t h e goods a l r e a d y i n h i s
        p o s s e s s i o n i s wholly i n c o n s i s t e n t with t h e
        s u p p o s i t i o n t h a t h i s former p o s s e s s i o n c o n t i n u e s
        unchanged, he may p r o p e r l y be s a i d t o have
        accepted and a c t u a l l y r e c e i v e d such goods under
        a contract.         ..
        A second s i t u a t i o n o c c u r s when t h e goods a r e in t h e
p o s s e s s i o n of a t h i r d p a r t y a s b a i l e e f o r t h e s e l l e r . This
i s governed by S e c t i o n 30 ( 5 ) of t h e S a l e of Goods Act:


        (5)     Where t h e goods a t t h e t i m e of t h e s a l e a r e
                in p o s s e s s i o n of a t h i r d person t h e r e i s no
                d e l i v e r y by t h e s e l l e r t o t h e buyer u n t i l t h e
                t h i r d person acknowledges t o t h e buyer t h a n
                he h o l d s t h e goods on h i s b e h a l f .

        A t h i r d problem a r e a i s t h e q u e s t i o n of whether t h e r e
can be r e c e i p t o r d e l i v e r y i f t h e s e l l e r has become b a i l e e
of t h e goods f o r t h e buyer, a l b e i t t h e r e has been no p h y s i c a l
change i n p o s s e s s i o n . Presumably i f t h e s e l l e r has p o s s e s s i o n
of t h e goods i n a c a p a c i t y a s b a i l e e f o r t h e buyer and n o t i n
h i s c a p a c i t y a s s e l l e r , t h e n t h i s should amount t o a con-
s t r u c t i v e change i n p o s s e s s i o n , i . e .   d e l i v e r y t o t h e buyer.
According t o Blackburn on S a l e , 4 1 :


        ...      i n many of t h e c a s e s [ r e l a t i n g t o t h i s t h i r d
        problem a r e a ] t h e t e s t f o r d e t e r m i n i n g whether t h e r e
        has been a c t u a l r e c e i p t by t h e p u r c h a s e r , has been
        t o e n q u i r e whether t h e seller has l o s t h i s l i e n .

However, by S e c t i o n 4 1 ( 2 ) of t h e S a l e of Goods Act:


        The seller may e x e r c i s e h i s r i g h t of l i e n notwith-
        s t a n d i n g t h a t he i s i n p o s s e s s i o n of t h e goods a s
        a g e n t o r b a i l e e f o r t h e buyer.

Hence, it would seem t h a t t h i s i s n o t a p a r t i c u l a r l y s u i t a b l e
test.
       The f i n a l problem a r e a i n v o l v e s d e l i v e r y of t h e goods t o
a carrier.        By S e c t i o n 33 (1) of t h e S a l e of Goods Act:

       Where in pursuance of a c o n t r a c t of s a l e t h e
       s e l l e r i s a u t h o r i z e d o r r e q u i r e d t o send t h e
       goods t o t h e buyer, d e l i v e r y of t h e goods t o t h e
       c a r r i e r , whether named by t h e buyer o r n o t , f o r
       t h e purpose of t r a n s m i s s i o n t o t h e buyer s h a l l
       prima f a c i e be deemed t o be a d e l i v e r y of t h e
       goods t o t h e buyer.

However, d e l i v e r y t o a c a r r i e r w i l l only amount t o r e c e i p t i f
t h e goods a r e in accordance with t h e contract--Gorman                       v. Boddy
(1845), 2 Car.         &   K.   145--and    i f t h e s e l l e r does n o t r e t a i n a
r i g h t of disposal--Benjamin            on S a l e , 216.

B.     The Giving of Something i n E a r n e s t t o Bind t h e C o n t r a c t
       o r i n P a r t Payment


       I n a d d i t i o n t o a s i g n e d n o t e o r memorandum and r e c e i p t
and acceptance t h e r e w i l l a l s o be compliance with S e c t i o n 7
i f something h a s been g i v e n i n e a r n e s t t o bind t h e c o n t r a c t
o r in p a r t payment. According t o Blackburn on S a l e , 4 1 :


       "Earnest" i s some t a n g i b l e token o r g i f t , which
       need n o t be money, g i v e n o r a c t u a l l y t r a n s f e r r e d
       by t h e buyer t o t h e s e l l e r t o mark t h e c o n c l u s i o n
       of t h e b a r g a i n .

Earnest i s n o t given a s p a r t of t h e p r i c e and i s an o u t r i g h t
g i f t t o the s e l l e r .    Both e a r n e s t and p a r t payment must be
independent of t h e c o n t r a c t ; they cannot be i n pursuance of
t h e terms of t h e c o n t r a c t i n o r d e r t o meet t h e s t a t u t o r y
requirements. Thus i n Walker v. Nussey ( 1 8 4 7 ) , 1 6 M. & W.
302 t h e r e was a term in t h e c o n t r a c t of s a l e t h a t t h e s e l l e r
should deduct from t h e p r i c e t h e amount of a d e b t which he
owed t h e buyer.            Because t h i s s e t - o f f was p a r t of t h e a c t u a l
p r o c e s s of c o n t r a c t i n g and t h u s n o t independent of t h e
                                                                                                   83
c o n t r a c t , it d i d n o t c o n s t i t u t e p a r t payment w i t h i n t h e
meaning of t h a t t e r m i n S e c t i o n 7.

        I t s h o u l d be n o t e d t h a t p a r 0 1 e v i d e n c e i s n e c e s s a r y t o
prove a c c e p t a n c e and r e c e i p t , e a r n e s t and p a r t payment.

C.      Meanins o f C o n t r a c t f o r t h e S a l e of Goods


        One problem a r e a i s t h e d e f i n i t i o n of "goods."                   Section 2
   (
(1) h ) of t h e S a l e of Goods Act s t a t e s :


                "goods" i n c l u d e s

                  (i) a l l c h a t t e l s p e r s o n a l o t h e r t h a n t h i n g s
                      i n a c t i o n o r money, and

                 (ii) emblements, i n d u s t r i a l growing c r o p s
                      and t h i n g s a t t a c h e d t o o r forming p a r t
                      of t h e l a n d t h a t a r e a g r e e d t o be
                      s e v e r e d b e f o r e sale o r under t h e con-
                      t r a c t of sale;

S e c t i o n 2 ( l ) ( h ) ( i ) i s f a i r l y c l e a r ; "goods" i n c l u d e s c h a t t e l s
p e r s o n a l b u t n o t c h o s e s i n a c t i o n such a s money, s h a r e s ,
insurance o r debts.               S e c t i o n 2 ( l ) ( h ) i i ) h a s a l r e a d y been
d i s c u s s e d in C h a p t e r I V and r e p l a c e s t h e common law d i s t i n c t i o n
between f r u c t u s n a t u r a l e s and f r u c t u s i n d u s t r i a l e s . (For a
more d e t a i l e d d i s c u s s i o n of t h e d e f i n i t i o n of "goods" see
Benjamin on S a l e , 171-189).

        Another problem p r e s e n t e d by S e c t i o n 7 a r i s e s a s a r e s u l t
of t h e l e g a l d i s t i n c t i o n between a c o n t r a c t f o r t h e s a l e of
goods and a c o n t r a c t f o r t h e supply of s k i l l and l a b o u r , t h e
l a t t e r t y p e of c o n t r a c t n o t having t o comply w i t h t h e formal-
i t i e s of t h e S a l e of Goods Act.               P r e c i s e l y what a t t r i b u t e s
d i s t i n g u i s h a c o n t r a c t f o r t h e s a l e of goods from one f o r
t h e s u p p l y of s k i l l and l a b o u r i s , i n r e a l i t y , a m e t a p h y s i c a l
question.         T h i s i s i l l u s t r a t e d by t h r e e c a s e s .
84
         I n Clay v. Yates ( 1 8 5 0 ) , 1 H.              & N.   73 (Exch.) t h e p l a i n -
 t i f f p r i n t e r e n t e r e d i n t o a c o n t r a c t with t h e d e f e n d a n t t o
 p r i n t a book.     R e f e r r i n g t o t h e d i s t i n c t i o n between c o n t r a c t s
 f o r t h e s a l e of goods and t h o s e f o r t h e supply of s k i l l and
 l a b o u r Pollock C.B.         s a i d , a t p.   78:


         ...       t h e t r u e c r i t e r i o n i s , whether work i s of
         t h e e s s e n c e of t h e c o n t r a c t , o r whether it i s
         the materials supplied.

 The c o u r t u l t i m a t e l y h e l d t h a t t h e c o n t r a c t t o p r i n t t h e book
 was n o t a c o n t r a c t f o r t h e s a l e of goods.


         I n - v. G r i f f i n ( 1 8 6 1 ) , 30 L.J.Q.B. 252, 1 B . & S. 272
              Lee
 a c o n t r a c t t o make a s e t of d e n t u r e s w a s held t o be a c o n t r a c t
 f o r t h e s a l e of goods.     The c o u r t r e j e c t e d a c o n t e n t i o n t h a t
 t h e t e s t t o be used was t h e v a l u e of t h e work a s opposed t o
 t h e v a l u e of t h e m a t e r i a l s .   As a result,         i n t h e view of
 Blackburn J., a t 254, i f one employs a famous s c u l p t o r t o
 make a s t a t u t e and t h e s c u l p t o r s u p p l i e s t h e marble, t h i s is a
 s a l e of goods, even though t h e v a l u e of t h e marble may be much
 l e s s t h a n t h e v a l u e of t h e l a b o u r . T h i s s t a t e m e n t is, however,
 d i f f i c u l t t o r e c o n c i l e w i t h t h e next case.


         I n Robinson v. Graves 119351 1 K.B.                       579 (C.A.)       the
 defendant commissioned an a r t i s t t o p a i n t a p i c t u r e . This
 was held t o be a c o n t r a c t f o r t h e supply of s k i l l and labour
 and n o t f o r t h e s a l e of goods.             The c o u r t s t a t e d t h a t i f t h e
                                                a
 "substance" of t h e c o n t r a c t w s s k i l l and labour and i f t h e
 m a t e r i a l s s u p p l i e d were o n l y " a n c i l l a r y " t h e c o n t r a c t then
 it i s a c o n t r a c t f o r s k i l l and labour.          (Contra, s e e I s a a c s
 v. Hardy (1884), Cab. & E l . 287 i n which a c o n t r a c t t o p a i n t
 a p i c t u r e w a s h e l d t o be a c o n t r a c t f o r t h e s a l e of goods.)

        I f a c o n t r a c t i s formed f o r t h e s a l e of a c h a t t e l which
 i s t o be a f f i x e d t o l a n d o r t o a n o t h e r c h a t t e l b e f o r e t h e
p r o p e r t y i s t o p a s s , t h i s r e l a t e s t o l a b o u r and n o t goods, a s
t h e c o n t r a c t i s f o r t h e improvement of t h e land o r p r i n c i p a l
c h a t t e l . --Benjamin on S a l e , 167.

        One f u r t h e r problem a r e a a r i s e s a s a r e s u l t of t h e words,
"of t h e v a l u e of $50 o r upwards."                I f several c h a t t e l s are
bought in one t r a n s a c t i o n , each of t h e v a l u e of l e s s than $50,
b u t with a t o t a l v a l u e of over $50, t h i s w i l l be a c o n t r a c t
f o r t h e s a l e of goods of more than $50--Baldey                      v. Parker (1823),
2 B.    & C.    37.      This n e c e s s i t a t e s determining whether goods
have been bought i n a s e r i e s of t r a n s a c t i o n s o r a s i n g l e
transaction.           F a c t o r s such a s whether t h e p r i c e i s paid a s a
lump sum, whether t h e goods a r e bought a t t h e same time and
whether t h e goods a r e i n c l u d e d in one account may be r e l e v a n t - -
Benjamin on S a l e , 190. Auction s a l e s a r e i n a somewhat
d i f f e r e n t position. By S e c t i o n 58 ( b ) of t h e S a l e of Goods Act:

        ...        where goods a r e p u t up f o r s a l e by a c t i o n i n
        l o t s , e a c h l o t s h a l l be prima f a c i e deemed t o be t h e
        s u b j e c t of a s e p a r a t e c o n t r a c t o f a l e .

D.      E v a l u a t i o n of t h e Law and P r o ~ o s a l sf o r Reform


     I n c o n s i d e r i n g whether S e c t i o n 7 of t h e S a l e of Goods Act
should be r e p e a l e d we have come t o t h e c o n c l u s i o n t h a t c o n t r a c t s
f o r t h e s a l e of goods do n o t have t h e same unique c h a r a c t e r i s -
t i c s which j u s t i f y f o r m a l i t i e s f o r c o n t r a c t s concerning land.
Whereas c o n t r a c t s concerning land a r e almost always of monetary
s i g n i f i c a n c e , t h e r e a r e many c o n t r a c t s f o r t h e s a l e of goods
of over $50 which c a n n o t be so c h a r a c t e r i z e d .             Hence, c a u t i o n a r y
o b j e c t i v e s a r e less i m p o r t a n t .   (This p a r t i c u l a r f a c t in i t s e l f
would n o t j u s t i f y r e p e a l , o n l y a r a i s i n g of t h e d o l l a r v a l u e
o f c o n t r a c t s covered by t h e Act.)                Land, being immoveable, i s
unique; t h u s t h e r e may be s e n t i m e n t a l c o n s i d e r a t i o n s n e c e s s i -
t a t i n g f o r m a l i t i e s a s a c a u t i o n a r y d e v i c e . Most goods, on t h e
o t h e r hand, have s u b s t i t u t e s on t h e open market.                   A person may
need some p r o t e c t i o n from r a s h l y c o n t r a c t i n g t o s e l l h i s farm
where he has l i v e d f o r 20 y e a r s .        I t i s d i f f i c u l t t o make t h e
same argument a s f o r c e f u l l y i n t h e i n s t a n c e of a r a s h l y e n t e r e d
c o n t r a c t t o s e l l a used t r a c t o r . H e c a n n o t n e c e s s a r i l y buy an
e q u i v a l e n t p i e c e o f l a n d ; he c a n always buy a n o t h e r t r a c t o r .
Whereas many i n d i v i d u a l s w i l l e n t e r c o n t r a c t s f o r t h e sale o r
p u r c h a s e of l a n d a t most o n l y a few t i m e s i n t h e c o u r s e of
t h e i r l i v e s , most p e o p l e c a n be expected t o e n t e r i n t o con-
t r a c t s f o r t h e s a l e of goods o v e r $50, s e v e r a l t i m e s each y e a r .

       A l l these d i f f e r e n c e s p o i n t t o a conclusion t h a t c o n t r a c t s
f o r t h e s a l e of goods a r e more a k i n t o o t h e r c o n t r a c t s n o t
having any s p e c i a l e v i d e n t i a r y r e q u i r e m e n t s t h a n t h e y a r e t o
c o n t r a c t s concerning land.            A s t h e E n g l i s h Law R e v i s i o n
Committee Report, 9 s t a t e s :


        A s t h i s c r i t e r i o n is a p p l i e d by t h e p r o v i s i o n s
        under review, a man who by an o r a l c o n t r a c t buys
        o r s e l l s 510 worth of goods, c a n n o t ( s u b j e c t t o
        a c t s of p a r t performance) e n f o r c e h i s b a r g a i n ,
        y e t a man who o r a l l y c o n t r a c t s t o do work o r t o
        sell shares o r t o insure property (against other
        t h a n marine r i s k s ) can e n f o r c e h i s b a r g a i n , and
        have it e n f o r c e d a g a i n s t him, however g r e a t t h e
        amount i n v o l v e d .

        The S e c t i o n is o u t of a c c o r d w i t h t h e way i n
        which b u s i n e s s i s n o r m a l l y done. Where a c t u a l
        p r a c t i c e and l e g a l r e q u i r e m e n t d i v e r g e , t h e r e i s
        always an opening f o r knaves t o e x p l o i t t h e
        divergence.

Following t h e recommendations of t h e E n g l i s h Law R e v i s i o n
Committee t h e e q u i v a l e n t of o u r S e c t i o n 7 was r e p e a l e d i n
G r e a t B r i t a i n [Law Reform (Enforcement of C o n t r a c t s ) A c t ,
1954, 2 & 3 E l i z . 11, c. 34, s. 21.            I t h a s a l s o been r e p e a l e d
i n N e w Zealand ( C o n t r a c t s Enforcement A c t , 1956, No. 23, s. 4 )
and i n B r i t i s h Columbia, ( S t a t u t e Law Amendment A c t , S.B.C.
1958, c. 52, s. 17.
                                                                                                  87
        I n Fridman, S a l e of Goods in Canada, 38-39 t h e m e r i t s
o f t h i s p r o v i s i o n were c o n s i d e r e d in t h e f o l l o w i n g t e r m s :


        The r e p e a l of t h e s e p r o v i s i o n s i n t h e E n g l i s h
        S a l e of Goods A c t i n 1954 has n o t r e s u l t e d i n any
        d e t r i m e n t t o commercial l i f e g e n e r a l l y .        Indeed
        it would seem t h a t t h e r e i s no s i g n i f i c a n t l e g a l
        p o l i c y t h a t is b e i n g s e r v e d i n modern l i f e by
        t h e r e t e n t i o n of t h e provisions.               The g e n e r a l law
        of s a l e o f goods would n o t s u f f e r i n q u a l i t y i f
        t h i s s e c t i o n of t h e A c t were r e p e a l e d , and such a
        g e n e r a l r e q u i r e m e n t of w r i t i n g ( o r some e q u i v a l e n t )
        no l o n g e r made mandatory.                 The l a c k of any such
        p r o v i s i o n i n B r i t i s h Columbia d o e s n o t a p p e a r t o
        have had any ill e f f e c t s , which l e a d s t o t h e con-
        c l u s i o n t h a t no r e a l l y v i t a l purpose i s being
        s e r v e d i n t h e modern law of s a l e of goods by t h e
        r e t e n t i o n of t h i s a r c h a i c p r o v i s i o n .


          Can it be a r g u e d t h a t t h e p r o v i s i o n s h o u l d be r e t a i n e d
a s a p i e c e of consumer p r o t e c t i o n l e g i s l a t i o n ? i.e. when
t h e d o l l a r v a l u e i s l a r g e do consumers need p r o t e c t i o n from
e n t e r i n g i n t o rash o r impulsive bargains? I n considering
t h i s q u e s t i o n we n o t e t h a t i n most such c a s e s t h e c o n t r a c t
w i l l be e n f o r c e a b l e a g a i n s t t h e consumer under e x i s t i n g law
i n any e v e n t .         Many consumer c o n t r a c t s i n v o l v e immediate
d e l i v e r y and p r o b a b l y t h u s s a t i s f y t h e " r e c e i p t and a c c e p t a n c e "
requirement.              I f t h e r e i s no immediate d e l i v e r y it i s q u i t e
l i k e l y t h a t a d e p o s i t o r a s i g n e d s a l e s s l i p has been t a k e n
from t h e consumer. There c a n n o t be many c a s e s of c o m p l e t e l y
o r a l , t o t a l l y e x e c u t o r y consumer s a l e s c o n t r a c t s .      I n these
r a r e c a s e s , g i v e n b u s i n e s s p r a c t i c e and t h e d i f f i c u l t i e s of
p r o v i n g such a c o n t r a c t ( q u i t e a p a r t from any s t a t u t o r y
e v i d e n t i a r y r e q u i r e m e n t s ) it i s n o t l i k e l y t h a t b u s i n e s s
sellers would a t t e m p t t o e n f o r c e t h e c o n t r a c t anyway.                    In
f a c t , r e t e n t i o n of t h e p r e s e n t l e g i s l a t i o n under t h e g u i s e of
p r o t e c t i n g t h e consumer might have j u s t t h e o p p o s i t e e f f e c t .
Businessmen, i n t h e i r d e a l i n g s w i t h consumers i n l a r g e monetary
s a l e s t r a n s a c t i o n s , a r e probably going t o t a k e s u f f i c i e n t
88
steps t o ensure t h e t r a n s a c t i o n is enforceable against the
buyer.        n
             O t h e o t h e r hand, r e t e n t i o n can r e s u l t i n consumers
n o t being a b l e t o e n f o r c e c o n t r a c t s a g a i n s t s e l l e r s , such a s
where goods a r e n o t i n s t o c k and where t h e n o t e o r memorandum
of t h e c o n t r a c t i s signed only by t h e consumer, and n o t by t h e
retailer.


         Is t h e r e t h e n any argument i n favour of f o r m a l i t i e s f o r
s a l e of goods c o n t r a c t s e n t e r e d i n t o e x c l u s i v e l y between
b u s i n e s s e n t i t i e s ? I n a s t u d y e n t i t l e d , "The S t a t u t e of Frauds
and t h e Business Community: A Re-appraisal i n Light of P r e -
v a i l i n g P r a c t i c e s " (1957) 66 Yale L . J . 1038, it was d i s c o v e r e d ,
based on r e s p o n s e s by manufacturers i n Connecticut t o a ques-
t i o n n a i r e c i r c u l a t e d , t h a t b u s i n e s s p r a c t i c e u s u a l l y complied
w i t h t h e S t a t u t e of Frauds requirements. I t was a l s o d i s c o v e r e d
t h a t such compliance was n o t because of t h e S t a t u t e but r a t h e r
because it was deemed sound b u s i n e s s p r a c t i c e .                The study
t h e r e f o r e concluded t h a t r e p e a l of t h e S t a t u t e of Frauds would
have l i t t l e e f f e c t on b u s i n e s s p r a c t i c e . F u r t h e r , w e do n o t
s e e any s p e c i a l c a u t i o n a r y o b j e c t i v e s i n an e x c l u s i v e l y b u s i -
ness transaction.       e
                       W assume t h a t b u s i n e s s e n t i t i e s do n o t buy
o r s e l l impulsively and t h a t due r e f l e c t i o n i s given in most
transactions.           A s f o r e v i d e n t i a r y o b j e c t i v e s , w e cannot s e e
how c o n t r a c t s f o r t h e s a l e of goods m e r i t s p e c i a l e v i d e n t i a r y
p r o v i s i o n s , when o t h e r , o f t e n v e r y l a r g e , commercial c o n t r a c t s
 (e.g.    s a l e s of s h a r e s ) , do not.

          I f S e c t i o n 7 i s n o t r e p e a l e d it would c e r t a i n l y be
d e s i r a b l e t o r a i s e t h e d o l l a r v a l u e of goods covered by t h e
Act.        I n 1677, h10 was of c o n s i d e r a b l y g r e a t e r v a l u e than i s
$50 a t p r e s e n t . The s a l e of goods i s a d a i l y occurrence
f o r most persons, and c o n t r a c t s f o r $50 and more a r e i n c r e a s -
ingly frequent.          Given t h e c u r r e n t r a t e of i n f l a t i o n , t h i s
p r o v i s i o n may become t o t a l l y u n r e a l i s t i c .
        e
       W i n v i t e comment on t h e following q u e s t i o n s .

QUESTION 20


       Should S e c t i o n 7 of t h e S a l e of Goods Act be
       repealed?


QUESTION 2 1


       I f S e c t i o n 7 i s n o t r e p e a l e d , should t h e d o l l a r
       v a l u e of s a l e s c o n t r a c t s covered by t h e p r o v i s i o n
       be r a i s e d ?


     I f S e c t i o n 7 i s n o t r e p e a l e d t h e r e a r e o t h e r measures
which can be t a k e n t o reform t h e law,                Some such measures
a r e found i n t h e Uniform Commercial Code 2-201 :

              Except a s o t h e r w i s e provided i n t h i s s e c t i o n
              a c o n t r a c t f o r t h e s a l e of goods f o r t h e p r i c e
              of $500 o r more i s n o t e n f o r c e a b l e by way of
              a c t i o n o r d e f e n s e u n l e s s t h e r e is some w r i t i n g
              sufficient t o indicate that a contract for
              s a l e h a s been made between t h e p a r t i e s and
              signed by t h e p a r t y a g a i n s t whom enforcement
              i s sought o r by h i s a u t h o r i z e d a g e n t o r broker,
              A w r i t i n g i s n o t i n s u f f i c i e n t because it omits
              o r i n c o r r e c t l y s t a t e s a term agreed upon b u t
              t h e c o n t r a c t i s n o t e n f o r c e a b l e under t h i s
              paragraph beyond t h e q u a n t i t y of goods shown
              i n such w r i t i n g ,

              Between merchants i f w i t h i n a r e a s o n a b l e time
              a w r i t i n g i n c o n f i r m a t i o n of t h e c o n t r a c t and
              s u f f i c i e n t a g a i n s t t h e sender i s r e c e i v e d and
              t h e p a r t y r e c e i v i n g it has reason t o know i t s
              c o n t e n t s , it s a t i s f i e s t h e r e q u i r e m e n t s of
              s u b s e c t i o n (1) a g a i n s t such p a r t y u n l e s s w r i t t e n
              n o t i c e of o b j e c t i o n t o i t s c o n t e n t s i s given
              w i t h i n 10 days a f t e r it i s r e c e i v e d ,
        (3)   A c o n t r a c t which does n o t s a t i s f y t h e r e q u i r e -
              ments of s u b s e c t i o n (1) b u t which i s v a l i d i n
              other respects i s enforceable
            (a)   i f t h e goods a r e t o be s p e c i a l l y manu-
                  f a c t u r e d f o r t h e buyer and a r e n o t s u i t a b l e
                  f o r s a l e t o o t h e r s in t h e o r d i n a r y c o u r s e
                  of t h e s e l l e r ' s b u s i n e s s and the s e l l e r ,
                  b e f o r e n o t i c e of r e p u d i a t i o n i s r e c e i v e d
                  and under c i r c u m s t a n c e s which r e a s o n a b l y
                  i n d i c a t e t h a t t h e goods a r e f o r t h e buyer,
                  has made e i t h e r a s u b s t a n t i a l beginning of
                  t h e i r manufacture o r commitments f o r t h e i r
                  procurement; o r
            (b)   i f t h e p a r t y a g a i n s t whom enforcement i s
                  sought admits i n h i s p l e a d i n g , testimony
                  o r otherwise i n court t h a t a contract f o r
                  s a l e was made b u t t h e c o n t r a c t i s n o t
                  e n f o r c e a b l e under t h i s p r o v i s i o n beyond
                  t h e q u a n t i t y of goods admitted; o r
            (c)   w i t h r e s p e c t t o goods f o r which payment
                  has been made and accepted o r which have
                  been r e c e i v e d and accepted.


     Besides r a i s i n g t h e d o l l a r v a l u e t o $500, t h e main changes
proposed by t h e Uniform Commercial Code a r e :

     1)    By s u b s e c t i o n (1) t h e w r i t i n g need o n l y " i n d i c a t e "
           a c o n t r a c t f o r s a l e has been made and w i l l n o t be
           i n s u f f i c i e n t merely because of omission o r m i s -
           s t a t e m e n t of a term. The arguments f o r and a g a i n s t
           such a p r o p o s a l have a l r e a d y been canvassed i n our
           d i s c u s s i o n of t h e memorandum r e q u i r e m e n t s i n
           Chapter I V     .
     2)    By s u b s e c t i o n ( 2 ) , acquiescence f o r 10 days by a
           p a r t y r e c e i v i n g a memorandum i n c o n f i r m a t i o n of
           the c o n t r a c t w i l l render the c o n t r a c t enforceable.
           Here t h e acquiescence i s a s u b s t i t u t e f o r a
           signature in a writing.


     3)    By s u b s e c t i o n ( 3 ) ( a ) a c o n t r a c t f o r t h e s a l e of
           goods t o be s p e c i a l l y manufactured f o r t h e buyer
           and which c a n n o t be s o l d i n t h e o r d i n a r y course
                                                                                           91
              of b u s i n e s s i s e n f o r c e a b l e i f t h e s e l l e r has begun
              manufacture o r committed himself f o r procurement.
              The main r e a s o n f o r such a p r o v i s i o n i s t h a t i n
              t h i s f a c t s i t u a t i o n , because of t h e commitment o r
              r e l i a n c e of t h e s e l l e r and t h e i n a b i l i t y t o s e l l
              such goods elsewhere t h e r e w i l l be an i n j u s t i c e
              a r i s i n g from u n e n f o r c e a b i l i t y n o t normally t h e c a s e
              i n unenforceable c o n t r a c t s f o r t h e s a l e of goods.


       (4)    By s u b s e c t i o n ( 3 ) ( b ) an admission in p l e a d i n g s
              o r testimony w i l l render t h e c o n t r a c t enforceable.
              This i s a d i f f i c u l t i s s u e . An admission would
               seem t o be compelling evidence.                     n
                                                                   O the other
              hand, such a p r o p o s a l might encourage l e s s than
              f u l l d i s c l o s u r e and perhaps p e r j u r y .


       n
      O t h e assumption t h a t S e c t i o n 7 of t h e S a l e of Goods
Act i s n o t r e p e a l e d vie i n v i t e comments on t h e f o l l o w i n g
questions.


QUESTION 2 2


       Should t h e r e q u i r e m e n t s of a s u f f i c i e n t note o r
       memorandum be l e s s e n e d f o r c o n t r a c t s f o r t h e s a l e
       of goods?


QUESTION 23


       Should t h e a c q u i e s c e n c e of a p a r t y t o a confirming
       w r i t i n g by t h e o t h e r p a r t y r e n d e r such c o n t r a c t f o r
       t h e s a l e of goods e n f o r c e a b l e a g a i n s t t h e p a r t y
       r e c e i v i n a t h e memorandum?
92
QUESTION 24


     Should a c o n t r a c t f o r t h e s a l e of goods be e n f o r c e -
     a b l e where t h e goods a r e t o be s p e c i a l l y manufactured
     f o r t h e buyer, where such goods could n o t be s o l d in
     t h e o r d i n a r y c o u r s e of b u s i n e s s , and where t h e s e l l e r
     has r e l i e d on t h e c o n t r a c t e i t h e r by beginning manu-
     f a c t u r e o r committing himself f o r t h e procurement of
     t h e goods?

QUESTION 25


     Should an admission i n t h e p l e a d i n g s o r testimony
     render t h e c o n t r a c t e n f o r c e a b l e a g a i n s t t h e p a r t y
     making t h e admission?
                                          CHAPTER V I I

                                F             F
                     SECTION 7 O THE STATUTE O FRAUDS

                                       F        F
             DECLARATION AND CREATION O TRUSTS O LAND--


A.      Operation of t h e S e c t i o n


        S e c t i o n 7 of t h e S t a t u t e of Frauds p r o v i d e s :


        And be it f u r t h e r e n a c t e d by t h e a u t h o r i t y
        a f o r e s a i d t h a t from and a f t e r t h e s a i d f o u r
        and t w e n t i e t h day of June [1677] a l l d e c l a r a -
        t i o n s o r c r e a t i o n s of t r u s t s o r c o n f i d e n c e s
        of any l a n d s , tenements o r h e r e d i t a m e n t s s h a l l
        be manifested and proved by some w r i t i n g signed
        by t h e p a r t y who i s by law enabled t o d e c l a r e
        such t r u s t o r by h i s l a s t w i l l i n w r i t i n g o r
        e l s e t h e y s h a l l be u t t e r l y void and of none
        effect.




        The s e c t i o n r e f e r s only t o d e c l a r a t i o n s o r c r e a t i o n s of
t r u s t s of   ". . . l a n d s ,     tenements, o r h e r e d i t a m e n t s .      . . ."
This has been h e l d t o i n c l u d e l e a s e s - - S k e t t         v. Whitmore (1705)
2 Freem. Ch. 280, F o r s t e r v. Hale (1798) 3 Ves.                             696--but
t h e s e c t i o n does n o t o t h e r w i s e i n c l u d e p e r s o n a l t y .   A sum of
money secured upon a mortgage of r e a l e s t a t e i s a l s o n o t
w i t h i n t h e ambit of t h e section--Lewin,                    T r u s t s , 53, 54 (11th
ed.,    1904) ; Benbow v. Townsend 1 M .
                                      y                        & K.    506.      Charitable
t r u s t s a r e included--Lloyd            v.    S p i l l e t (1734) 3 P. Wms.            344;
Boson v. Statham (1760) , 1 Eden 509.                           Whether o r n o t t h e
s e c t i o n b i n d s t h e Crown i s i n d i s p u t e .         I n - v. P o r t i n g t o n ,
                                                                        R.
                                                             a
1 Salk 162, t h e Exchequer Court held t h e Crown w s n o t bound
while t h e Court of Q u e e n ' s Bench, ( 3 S a l k . 334) h e l d it was
bound.        (On t h i s p o i n t s e e a l s o Lewin, T r u s t s 55 (11th ed.,
1 9 0 4 ) , Keeton, T r u s t s 50 ( 4 t h ed.,            1947).
         This s e c t i o n a p p l i e s t o t h e c r e a t i o n of e v e r y t r u s t of
l a n d , howsoever it i s c r e a t e d , and whether t h e s u b j e c t m a t t e r
o f t h e t r u s t i s a l e g a l o r an e q u i t a b l e interest.           "Whether
a t r u s t i s brought i n t o being by t h e owner of an i n t e r e s t
d e c l a r i n g himself t o be a t r u s t e e , o r he t r a n s f e r s t h e
i n t e r e s t t o t r u s t e e s t o hold on c e r t a i n t r u s t terms, t h i s
t r u s t i s caught by t h e language of t h e s e c t i o n . This i s so
whether t h e i n t e r e s t i n q u e s t i o n i s l e g a l o r e q u i t a b l e . " - -
Waters, Law of T r u s t s i n Canada, 184. There i s some a u t h o r i t y
f o r s t a t i n g t h a t a d i r e c t i o n by a b e n e f i c i a r y t o t h e t r u s t e e
w i l l c o n s t i t u t e a d e c l a r a t i o n of t r u s t by t h e b e n e f i c i a r y ,
t h u s b r i n g i n g t h e s e c t i o n i n t o o p e r a t i o n . --Tierney v. Wood
 (1854), 1 9 Beav. 330, 52 E.R. 377.

        2.      The W r i t i n g Requirement


         The s e c t i o n r e q u i r e s t h a t t h e d e c l a r a t i o n of c r e a t i o n of
t r u s t must be "manifested and proved by some w r i t i n g . " Like
t h e requirements of s e c t i o n 4 , it i s n o t n e c e s s a r y t h a t t h e
d e c l a r a t i o n o r c r e a t i o n i t s e l f - in w r i t i n g ; t h u s a w r i t i n g
                                                      be
subsequent t o t h e t r u s t c r e a t i o n may be s u f f i c i e n t - - s e e
Wilde v. Wilde ( 1 8 7 3 ) , 20 G r . 521, 531 ( C . A . ) , ~ o c h e f o u c a u l dv.
Boustead [1897] 1 Ch. 196, 205-206.                           I t i s , however,         necessary
t h a t t h e w r i t i n g prove n o t o n l y t h e e x i s t e n c e of t h e t r u s t e e -
s h i p , but a l s o t h e t r u s t t e r m s . --Smith v. Matthews (1861) ,
3 D e G.F.       & J.    139, 45 E.R.          831.      A s i s the case with section
4 , documents may be joined t o form a s u f f i c i e n t writing--
Keeton, T r u s t s 51 ( 4 t h e d . ,         1 9 4 7) , r e l y i n g on F o r s t e r V.    -
                                                                                               Hale
 (1798) 3 Ves. 698. Unlike s e c t i o n 4 , t h e r e i s no p r o v i s i o n
f o r s i g n a t u r e by an a g e n t .

       F i n a l l y , it i s n e c e s s a r y t h a t t h e w r i t i n g be "signed by
t h e p a r t y who i s by law e n t i t l e d t o d e c l a r e such t r u s t . "    This
means t h a t i f t h e s u b j e c t m a t t e r of t h e t r u s t c r e a t e d i s
i t s e l f a b e n e f i c i a r y ' s e q u i t a b l e i n t e r e s t under a t r u s t , t h e
s i g n a t u r e of t h e b e n e f i c i a r y i s required--Tierney           -
                                                                           v. Wood.

       3.     Legal E f f e c t Where Writing Requirement i s n o t
              Satisfied


       I n s p i t e of t h e wording i n s e c t i o n 7 t h a t c r e a t i o n s and
d e c l a r a t i o n s n o t complying with t h e w r i t i n g requirement " s h a l l
be u t t e r l y void and of none e f f e c t , " t h e r e i s c o n t r o v e r s y
o v e r whether non-compliance r e n d e r s t h e t r u s t void o r only
unenforceable.


       I n Drummond v. Drummond (1965), 50 W.W.R.                     538, a t 543,
544 (B.C.     S.C.)    non-compliance with t h e o l d B.C.              S t a t u t e of
Frauds e q u i v a l e n t t o s e c t i o n 7 (R.S.B.C. 1936, c. 104, s. 7)
was t r e a t e d a s r e n d e r i n g t h e t r u s t void. I n Leroux v. Brown
( 1 8 5 2 ) , 12 C.B. 801, 804 J e r v i s C . J . c o n t r a s t e d t h e wording
o f s e c t i o n 4 ("no a c t i o n s h a l l be brought") w i t h s e c t i o n 7
i n holding t h a t t h e e f f e c t of s e c t i o n 4 was p r o c e d u r a l ,
r e n d e r i n g c o n t r a c t s merely unenforceable.

       However, it i s s t a t e d i n P e t t i t , E q u i t y and t h e Law of
Trusts      51 (2nd Ed.,       1970):


       I t seems g e n e r a l l y t o have been assumed,                con-
       s i s t e n t l y w i t h t h e view t h a t w r i t i n g was merely
       r e q u i r e d a s e v i d e n c e , [Leroux v. Brown], t h a t
       t h e e f f e c t of absence o               f i n g was t h e same
       under s e c t i o n 7 of t h e S t a t u t e of Frauds a s
       under s e c t i o n 4.           o
                                      N p o i n t seems t o have been
       taken i n any r e p o r t e d c a s e on t h e d i f f e r e n c e i n
       wording-- "no a c t i o n s h a l l be brought" i n
       s e c t i o n 4 , " o r e l s e t h e y s h a l l be u t t e r l y void
       and of none e f f e c t " under s e c t i o n 7.

       An example of a c a s e t a k i n g t h i s view i s Rochefoucauld v.
Boustead. There, t h e Court of Appeal, by way of analogy w i t h
Leroux v. Brown, h e l d t h a t s e c t i o n 7 r e l a t e d t o procedure.
Thus, t h e r a t i o n a l e f o r holding t r u s t s t o be unenforceable
would seem t o be t h a t s e c t i o n 7 r e q u i r e s a w r i t i n g only a s
evidence of t r u s t .         T h i s may come i n t o e x i s t e n c e a t any time
b e f o r e t h e a c t i o n on t h e t r u s t i s brought.           I t would seem
i n c o n s i s t e n t t o say t h a t t h e t r u s t i s void u n t i l t h e w r i t i n g
comes i n t o e x i s t e n c e .

        I n c o n c l u s i o n , t h e e f f e c t of non-compliance with s e c t i o n
7 i s uncertain.

B.      A v a i l a b l e R e l i e f Where Non-Compliance            with S e c t i o n 7

        There a r e two avenues of r e l i e f a v a i l a b l e where an o r a l
t r u s t of land does n o t comply with t h e S t a t u t e of Frauds,
s e c t i o n 7, Indeed, t h e r e l i e f provided by t h e c o u r t s has
been such t h a t some commentators have concluded t h a t t h i s
p a r t i c u l a r s e c t i o n of t h e S t a t u t e of Frauds has been r e p e a l e d
i n f a c t , i f n o t in law.--see t h e B r i t i s h Columbia Law Reform
Commission Working P a p e r , 6 0 ,


        The f i r s t avenue of r e l i e f a r i s e s a s a r e s u l t of s e c t i o n
8 of t h e S t a t u t e of Frauds i t s e l f :           section 8 basically excepts
t r u s t s a r i s i n g by i m p l i c a t i o n o r c o n s t r u c t i o n of law from t h e
o p e r a t i o n of s e c t i o n 7,    The second avenue of r e l i e f a r i s e s a s
a r e s u l t of t h e e q u i t a b l e d o c t r i n e of f r a u d t h a t t h e S t a t u t e
of Frauds cannot be used an i n s t r u m e n t of f r a u d .

        1.      S e c t i o n 8 of t h e S t a t u t e of Frauds

        S e c t i o n 8 of t h e S t a t u t e of Frauds p r o v i d e s :


        Provided always, t h a t where any conveyance s h a l l
        be made of any l a n d s o r tenements by which a
        t r u s t o r c o n f i d e n c e s h a l l o r may a r i s e o r r e s u l t
        by t h e i m p l i c a t i o n o r c o n s t r u c t i o n of law, o r be
        t r a n s f e r r e d o r e x t i n g u i s h e d by an a c t o r o p e r a t i o n
        of law, t h e n and i n e v e r y such c a s e such t r u s t
        o r confidence s h a l l be of t h e l i k e f o r c e and
        e f f e c t a s t h e same would have been i f t h i s S t a t u t e
        had n o t been made; anything h e r e i n b e f o r e c o n t a i n e d
        t o the contrary notwithstanding.
T r u s t s a r i s i n g by " c o n s t r u c t i o n o r i m p l i c a t i o n of law" a r e
b a s i c a l l y r e s u l t i n g t r u s t s and c o n s t r u c t i v e t r u s t s . In fact,
t h e English e q u i v a l e n t t o s e c t i o n 8 i s found i n s e c t i o n 53 ( 2 )
of t h e Law of P r o p e r t y Act which p r o v i d e s :

        This s e c t i o n does n o t a f f e c t t h e c r e a t i o n o r opera-
        t i o n of r e s u l t i n g implied o r c o n s t r u c t i v e t r u s t s .


     I n t h e c o n t e x t of an e x p r e s s o r a l t r u s t which does not
comply with s e c t i o n 7 , t h e c i r c u m s t a n c e s i n which a c o u r t
might f i n d a r e s u l t i n g t r u s t excepted by s e c t i o n 8, a r e out-
l i n e d i n Waters, Law of T r u s t s in Canada, 197-198 :

        There i s no r e s u l t i n g t r u s t i f A p u r c h a s e s land
        i n h i s own name, t h e arrangement w i t h B being
        t h a t A w i l l hold t h e land a s s e c u r i t y u n t i l B
        has paid A t h e purchase p r i c e .                 But i f X buys
        land and has it conveyed t o Y on terms t h a t Y i s
        t o hold on t r u s t f o r X, t h e r e i s an e x p r e s s t r u s t
        and t h e s i t u a t i o n a l s o g i v e s rise t o a r e s u l t i n g
        t r u s t ; under each t r u s t X i s t h e t r u s t b e n e f i c i a r y .
        Like t h e c o n s t r u c t i v e t r u s t , t h e r e s u l t i n g t r u s t
        a r i s e s by o p e r a t i o n of law, and i s e x p r e s s l y
        exempt from t h e p r o v i s i o n s of t h e S t a t u t e . A
        r e s u l t i n g t r u s t a r i s e s whenever one p a r t y buys
        p r o p e r t y and has it g r a t u i t o u s l y conveyed t o
        a n o t h e r o r i n t o t h e j o i n t names of himself and
        another.          I t a l s o a r i s e s when one p a r t y g r a t u i -
        t o u s l y t r a n s f e r s h i s own p r o p e r t y i n t o t h e name
        of a n o t h e r o r i n t o t h e j o i n t names of himself
        and a n o t h e r . I t w i l l t h e r e f o r e be seen t h a t i n
        many s i t u a t i o n s where land is conveyed on o r a l
        t r u s t , t h e law would in any e v e n t presume a
        resulting t r u s t i n t h e purchaser's, o r trans-
        f e r o r ' s favour.         I n t h i s way t h e burden of proof
        i s placed upon t h e t r a n s f e r e e i f he wishes t o
        argue t h a t a g i f t was intended.

        Can a r e s u l t i n g t r u s t be found i n favour of t h e s e t t l o r
where A conveys land t o T on t r u s t f o r B? The B.C. Law Reform
Commission has concluded i n i t s Working Paper, a t page 53 t h a t
a r e s u l t i n g t r u s t can be found i n such circumstances:
        The s i g n i f i c a n c e of t h e r e s u l t i n g t r u s t e x c e p t i o n
        i n t h e c o n t e x t of t h e S t a t u t e of F r a u d s i s t h a t
        where A o r a l l y d e c l a r e s T a t r u s t e e of c e r t a i n
        p r o p e r t y f o r t h e b e n e f i t of B, a r e s u l t i n g t r u s t
        w i l l c a u s e t h e p r o p e r t y t o be r e t u r n e d t o A.        In
        o t h e r words, t h e o r a l t r u s t i s n o t e n f o r c e d , t h e
        law c h o o s i n g , i n e f f e c t , t o g i v e t h e g r a n t o r t h e
        opportunity t o recreate the t r u s t i n writing i f
        i n f a c t it was h i s i n t e n t i o n t o do so.


However, t h i s c o n c l u s i o n i s c o m p l i c a t e d by t h e p o s s i b i l i t y of
a c o u r t e n f o r c i n q t h e o r a l t r u s t i n f a v o u r of B (on t h e b a s i s
o f t h e e q u i t a b l e d o c t r i n e of f r a u d ) o r f i n d i n g a c o n s t r u c t i v e
t r u s t i n f a v o u r of B.-    Such p o s s i b i l i t i e s c o n f l i c t somewhat w i t h
t h e c o n c l u s i o n of t h e B.C. Law Reform Commission.                     (The circum-
s t a n c e s i n which a c o u r t might e n f o r c e an o r a l t r u s t of l a n d
o r f i n d a c o n s t r u c t i v e t r u s t i n f a v o u r of t h e e x p r e s s bene-
f i c i a r y w i l l be d i s c u s s e d i n t h e n e x t s e c t i o n . )


     B e s i d e s r e s u l t i n g t r u s t s s e c t i o n 8 a l s o e x p r e s s l y exempts
constructive trusts.                While a d i s c u s s i o n of t h e many d i f f e r e n t
ways i n which a c o n s t r u c t i v e t r u s t may a r i s e a r e o u t s i d e t h e
scope o f t h i s Working P a p e r , it i s s u f f i c i e n t t o n o t e t h a t i n
t h e c a s e of an e x p r e s s o r a l t r u s t t h e f a c t s n e c e s s a r y t o
e s t a b l i s h a constructive t r u s t a r e precisely those necessary
t o b r i n g i n t o o p e r a t i o n t h e e q u i t a b l e d o c t r i n e of f r a u d ; i n
f a c t t h e c o n c e p t of t h e c o n s t r u c t i v e t r u s t may be t h e j u r i d i c a l
basis for the equitable doctrine.                         The c o n s t r u c t i v e t r u s t
c o n c e p t w i l l t h e r e f o r e be d i s c u s s e d under t h a t heading i n t h e
s e c t i o n immediately f o l l o w i n g :


        2.     The E q u i t a b l e D o c t r i n e of Fraud--The S t a t u t e of
               F r a u d s Cannot be Used a s an I n s t r u m e n t of Fraud


        W e have n o t e d t h a t t h e d o c t r i n e t h a t t h e S t a t u t e of F r a u d s
w i l l n o t be a l l o w e d t o be u s e d a s an i n s t r u m e n t of f r a u d h a s ,
i n t h e c a s e of u n e n f o r c e a b l e c o n t r a c t s , been v e r y n a r r o w l y
                                                                                                      99
confined so t h a t it p r o v i d e s l i t t l e r e l i e f from t h e r i g o r s of
the Statute.           I n t h e c a s e of o r a l t r u s t s n o t complying with
s e c t i o n 7 t h e d o c t r i n e has provided s u b s t a n t i a l r e l i e f . The
reason f o r the d i f f e r e n c e i n application i s not d i f f i c u l t t o
under stand.

          I n t h e c a s e of a c o n t r a c t t h e i n a b i l i t y , by reason of
non-compliance w i t h r e q u i s i t e f o r m a l i t i e s , t o e n f o r c e such
c o n t r a c t w i l l r e s u l t f o r t h e most p a r t i n a l o s s of t h e p l a i n -
t i f f ' s expectation i n t e r e s t .           Because t h e d e f e n d a n t w i l l
n o t be allowed t o r e t a i n any monies o r p r o p e r t y so long a s he
r e f u s e s t o perform (such monies o r p r o p e r t y a r e r e c o v e r a b l e
by t h e p l a i n t i f f on q u a s i - c o n t r a c t u a l g r o u n d s ) , t h e p l a i n t i f f
w i l l n o t be d e p r i v e d of any p r o p e r t y i n t e r e s t s .         Given t h e
o r i g i n a l e v i d e n t i a r y f u n c t i o n and t h e now more widely recognized
c a u t i o n a r y f u n c t i o n of f o r m a l i t i e s , and given t h a t what was a t
s t a k e was only an e x p e c t a t i o n i n t e r e s t , it i s n o t d i f f i c u l t t o
understand why t h e c o u r t s were r e l u c t a n t t o hold t h a t t h e mere
f a i l u r e t o perform a c o n t r a c t was s u f f i c i e n t t o f i n d t h a t t h e
S t a t u t e was being used a s an i n s t r u m e n t of f r a u d .

        I n t h e c a s e of l a n d conveyed t o a t r u s t e e w i t h an o r a l
t r u s t i n favour of e i t h e r t h e s e t t l o r o r some o t h e r b e n e f i c i a r y ,
t h e considerations a r e materially different.                                I f the trustee
were allowed t o r e t a i n t h e land f o r h i s own b e n e f i t , on t h e
b a s i s of t h e s e t t l e r ' s non-compliance with t h e S t a t u t e , t h e
t r u s t e e would be g e t t i n g an i n t e r e s t i n land which was never
i n t e n d e d t o be f o r h i s b e n e f i t , a t t h e expense of someone e l s e .
The r e s u l t would be n o t j u s t a d e p r i v a t i o n of an e x p e c t a t i o n
i n t e r e s t , but u n j u s t enrichment on a s c a l e which t r u l y would
                         o
work a f r a u d . N s o p h i s t i c a t e d l e g a l system could t o l e r a t e
such a c o n f i s c a t i o n of p r o p e r t y , merely because of t h e f a i l u r e
t o comply with c e r t a i n f o r m a l i t i e s .   Thus e q u i t y developed t h e
concept t h a t where a t r u s t e e t o whom land was conveyed on
t r u s t denied t h e t r u s t and claimed t h e land f o r h i m s e l f , t h a t
would be a f r a u d , d e s p i t e t h e f a c t t h a t t h e t r u s t was o r a l .
T h i s d o c t r i n e was s e t f o r t h i n i t s modern form i n t h e l e a d i n g
c a s e of Rochefoucauld v. Boustead [I8971 1 Ch. 196, 206 :

        ...  it i s a f r a u d on t h e p a r t of a person t o whom
       l a n d i s conveyed a s a t r u s t e e , and who knows it
       was so conveyed, t o deny t h e t r u s t and c l a i m t h e
       land himself.           Consequently, n o t w i t h s t a n d i n g t h e
       S t a t u t e , it i s competent f o r a person c l a i m i n g
       l a n d conveyed t o a n o t h e r t o prove by p a r 0 1 e v i d -
       e n c e t h a t it was s o conveyed upon t r u s t f o r t h e
       c l a i m a n t , and t h a t t h e g r a n t e e , knowing t h e f a c t s ,
       i s denying t h e t r u s t and r e l y i n g upon t h e form of
       conveyance and t h e s t a t u t e , in o r d e r t o keep t h e
       land himself.

       The p r i n c i p l e h a s been a p p l i e d i n Canada i n a number of
d i f f e r e n t c o n t e x t s (see Waters, a t p. 1 9 3 ) . The e x a c t
j u r i d i c a l b a s i s of t h e d o c t r i n e h a s , however, r e c e i v e d l i t t l e
j u d i c i a l comment and i s s t i l l u n c l e a r . Waters, a t p.               197,
p o i n t s o u t two p o s s i b l e b a s e s f o r t h e d o c t r i n e :

       There a r e two p o s s i b l e e x p l a n a t i o n s of t h e c o u r t ' s
       thinking.            (1) I t i s t h e e x p r e s s t r u s t c r e a t e d by
       t h e p a r t i e s t h a t i s e n f o r c e d , and it i s s o e n f o r c e d
       by p r e v e n t i n g t h e t r u s t e e from p l e a d i n g t h e S t a t u t e .
       The f r a u d t h a t would o t h e r w i s e be p e r p e t r a t e d
       j u s t i f i e s t h i s o u s t e r of t h e s t a t u t e ,-and Rochefou-
       c a l d v. Boustead i s t h e a u t h o r i t y f o r t h i s p r o p o s i -
       tion.          ( 2 ) A s t h e e x p r e s s t r u s t c a n n o t be e n f o r c e d
       because of t h e S t a t u t e , e q u i t y imposes a c o n s t r u c t i v e
       t r u s t upon t h e e x p r e s s t r u s t e e t o c a u s e him, because
       of h i s u n c o n s c i o n a b l e i n t e n t i o n , t o d i s g o r g e . The
       S t a t u t e i s t h u s honoured, and moreover t h e c o n s t r u c -
       t i v e t r u s t i s e x p r e s s l y exempt from t h e p r o v i s i o n s
       of t h e S t a t u t e .      I t i s t h e f r a u d t h a t would o t h e r w i s e
       r e s u l t which c a u s e s t h e c o u r t s t o impose t h i s con-
       s t r u c t i v e t r u s t , and t h e a u t h o r i t y f o r t h i s r e c o g n i -
       t i o n of f r a u d i s Rochefoucauld v. Boustead.

        Where t h e s e t t l o r and b e n e f i c i a r y a r e t h e same it i s o n l y
of academic i n t e r e s t which e x p l a n a t i o n i s a c c e p t e d . Whether
t h e t r u s t e n f o r c e d i s t h e e x p r e s s o r a l one, a c o n s t r u c t i v e one
imposed by r e a s o n of f r a u d o r even a r e s u l t i n g t r u s t t h e same
person w i l l be t h e b e n e f i c i a r y .
         Where t h e s e t t l o r and b e n e f i c i a r y a r e d i f f e r e n t t h e n t h e
e x p l a n a t i o n a c c e p t e d m x make a d i f f e r e n c e . I f A conveys l a n d
t o B o r a l l y imposing t r u s t c o n d i t i o n s i n f a v o u r of C , and if
i t i s t h e e x p r e s s t r u s t which i s e n f o r c e d , t h e n c l e a r l y C w i l l
be e n t i t l e d t o the land.    I f , on t h e o t h e r hand, a c o n s t r u c t i v e
t r u s t i s imposed, t h e q u e s t i o n s t i l l remains:  i n whose f a v o u r
i s the constructive t r u s t , the s e t t l o r o r the beneficiary?
Both Waters, a t 200, and t h e B.C. Law Reform Commission in i t s
Working Paper, a t 55, a r e of t h e o p i n i o n t h a t , a s a m a t t e r of
p r i n c i p l e , i f a c o n s t r u c t i v e t r u s t i s t o be imposed it should
b e i n f a v o u r of t h e s e t t l o r . The b a s i s f o r t h e i r c o n c l u s i o n
i s t h a t t h e purpose of a c o n s t r u c t i v e t r u s t i s t o work a
r e s t i t u t i o i n i n t e g r u m and t h i s can be accomplished o n l y i f t h e
c o n s t r u c t i v e t r u s t i s worked "backward" i n f a v o u r of t h e g r a n t o r .
Working a c o n s t r u c t i v e t r u s t forward i n f a v o u r of t h e i n t e n d e d
b e n e f i c i a r y e f f e c t i v e l y amounts t o e n f o r c i n g t h e e x p r e s s t r u s t .
A s i s p o i n t e d o u t i n Waters, 200, r e f e r r i n g t o t h e judgment
o f Duff J. i n Scheuerman v. Scheuerman,                          ( 1 9 1 6 ) , 52 S.C.R.       625,
636-637:

        P a t e n t l y t h e c o n s t r u c t i v e t r u s t would n o t j u s t i f y
        t h e c o u r t i n e n f o r c i n g t h e settler's purposes.
        The c o n s t r u c t i v e t r u s t , a s Duff J. p o i n t s o u t ,
        works a r e s t i t u t i o i n integrum..           .     The p r e s e n t
        a u t h o r f a i l s t o see how a c o n s t r u c t i v e t r u s t can
        work a n y t h i n g forward.               Such a " c o n s t r u c t i v e
        t r u s t " i s i n f a c t t h e e x p r e s s t r u s t c r e a t e d by
        the parties.


        E f f e c t i n g a c o n s t r u c t i v e t r u s t i n f a v o u r of t h e g r a n t o r
i s p r o b a b l y t h e s o u n d e s t s o l u t i o n i n c o n c e p t u a l terms.     By
n o t e n f o r c i n g t h e e x p r e s s o r a l t r u s t it g i v e s e f f e c t t o t h e
S t a t u t e , and, a t t h e same t i m e , it p r e v e n t s u n j u s t enrichment
 (by n o t a l l o w i n g t h e t r u s t e e t o hold f o r h i m s e l f )     .   However,
                                                        not
it must be conceded t h a t t h i s i s - t h e p o s i t i o n t a k e n by most
c o u r t s i n Canada.         I t i s c l e a r t h a t i n Rochefoucauld v.
Boustead it was t h e e x p r e s s o r a l t r u s t and n o t a c o n s t r u c t i v e
 102
t r u s t , which was b e i n g e n f o r c e d ; and in t h e words of Waters,
198,    "..
        .subsequent Canadian c o u r t s which have followed
Rouchefoucauld v. Boustead have shown no p a r t i c u l a r i n t e r e s t
i n what t r u s t it was t h e y were e n f o r c i n g . .         .
                                                                   I n f a c t there is
l i t t l e support i n Canadian j u r i s p r u d e n c e f o r t h e c o n s t r u c t i v e
t r u s t concept.        I n Scheuerman v. Scheuerman ( 1 9 1 6 ) , 52 S.C.R.
625 Duff J. r e f e r r e d t o t h e concept in an o b i t e r comment, a t
                                             -
636-607, and i n L a n g i l l e v. Nass (1917) 36 D.L.R.       368 (N.S.S.C.
A.D.) t h e c o u r t found a c o n s t r u c t i v e t r u s t b u t h e l d t h a t t h e
e x p r e s s t r u s t p u r p o s e s should be e n f o r c e d .


        I n s h o r t , w h i l e t h e r e i s l i t t l e a u t h o r i t y f o r t h e concept
o f a c o n s t r u c t i v e t r u s t , whatever a u t h o r i t y e x i s t s would s e e m
t o i n d i c a t e t h a t such a t r u s t works "forward" i n favour of
t h e i n t e n d e d b e n e f i c i a r i e s of t h e e x p r e s s o r a l t r u s t .

        To t h i s p o i n t o u r d i s c u s s i o n of t h e e q u i t a b l e d o c t r i n e
of f r a u d h a s been c o n f i n e d t o c a s e s where a p u r c h a s e r has
bought a l l e g e d l y on t r u s t f o r a n o t h e r o r where a g r a n t o r has
conveyed l a n d t o a t r u s t e e on t r u s t f o r e i t h e r himself o r f o r
                   e
a n o t h e r . W have n o t y e t c o n s i d e r e d t h e q u e s t i o n of whether
t h e e q u i t a b l e d o c t r i n e s e t f o r t h i n Rochefoucauld v. Boustead
c a n be used t o circumvent s e c t i o n 7 where t h e s e c t i o n i s r a i s e d
a s a defence t o a n a l l e g a t i o n t h a t a t r u s t has been c r e a t e d
by way of d e c l a r a t i o n only.          That i s , where T has o r a l l y
d e c l a r e d t h a t he h o l d s l a n d on t r u s t f o r B, and where T r a i s e s
t h e S t a t u t e o f F r a u d s i n d e f e n c e t o a c l a i m on t h e o r a l t r u s t
by B, can B circumvent t h i s d e f e n c e by a r g u i n g t h e e q u i t a b l e
d o c t r i n e of f r a u d ?   Such a t r u s t d e c l a r a t i o n may a r i s e in two
c o n t e x t s , e i t h e r a s a l l e g e d performance under a c o n t r a c t , o r by
way o f g i f t .

         The answer t o t h i s q u e s t i o n a p p e a r s t o be t h a t in t h i s
c o n t e x t t h e d o c t r i n e i n Rochefoucauld v. Boustead does -        not
apply.        I n Morris v. Whiting ( 1 9 1 3 ) , 1 5 D.L.R.         254 (Man. K.B. )               ,
followed i n B e e m e r v. Brownridge [I9341 1 W.W.R.                           545,       (Sask.C.A.)
l a n d was purchased by A f o r h i s own use.                      I t was a l l e g e d t h a t
subsequent t o t h e purchase A had c r e a t e d a t r u s t of a one-half
i n t e r e s t i n t h e l a n d i n f a v o u r of B. I n holding t h a t s e c t i o n 7
o f t h e S t a t u t e of Frauds was an a b s o l u t e d e f e n c e t o t h i s
a l l e g a t i o n , Mathers C . J . commented, a t 257-258:


       ...   [ t h e d e f e n d a n t ] a d m i t s t h a t t h e l a n d was n o t
       purchased f o r t h e j o i n t b e n e f i t of both, b u t by
       t h e p l a i n t i f f a l o n e and f o r h i s own use.             I f any
       t r u s t a r o s e f o r t h e b e n e f i t of t h e d e f e n d a n t i n
       r e s p e c t of t h e l a n d it must have been c r e a t e d
       a f t e r t h e p l a i n t i f f had become t h e owner t h e r e o f .
       Here a g a i n t h e a b s e n c e of a w r i t i n g r e q u i r e d by
       t h e 7 t h s e c t i o n of t h e S t a t u t e of Frauds, i s , i n
         y
       m o p i n i o n , a bar t o t h e d e f e n d a n t ' s r i g h t of
       recovery.           The f a c t s of t h i s c a s e c l e a r l y d i s t i n -
       g u i s h it from Rouchef oucauld v. Boustead, [I8971
       1 Ch. 196: Gordon v. Handford, 16 Man. L.R. 292,
       and t h e numerous o t h e r c a s e s which d e c i d e t h a t ,
       where l a n d h a s been conveyed t o a person i n t r u s t
       f o r a n o t h e r , it i s f r a u d f o r t h e t r u s t e e t o deny
       t h e t r u s t and claim t h e l a n d a s h i s own, and a s
       t h e S t a t u t e of Frauds w a s n o t i n t e n d e d t o be a
       c l o a k f o r f r a u d , it i s no defence i n such a c a s e .
       I n a l l t h o s e c a s e s , t h e r e l a t i o n s h i p of t r u s t e e
       and c e s t u i que t r u s t a r o s e a t t h e i n c e p t i o n of
       the transaction.                 The p r o p e r t y never d i d belong
       t o t h e t r u s t e e , b u t came t o him charged w i t h t h e
       t r u s t . An a t t e m p t t o a f t e r w a r d s hold a s h i s own
       p r o p e r t y what d i d n o t belong t o him b u t t o
       a n o t h e r i s a f r a u d i n t h e p e r p e t r a t i o n of which
       t h e s t a t u t e c a n n o t be invoked. But t h e m e r e
       b r e a c h of a c o n t r a c t t o s e l l an i n t e r e s t i n l a n d
       i s n o t a f r a u d which w i l l t a k e t h e c a s e o u t of
       the s t a t u t e .       The p l a i n t i f f r e c e i v e d no p r o p e r t y
       from t h e d e f e n d a n t t o hold a s t r u s t e e f o r him.
       The most t h e d e f e n d a n t a l l e g e s i s , t h a t t h e
       p l a i n t i f f a g r e e d t o hold p r o p e r t y which w a s h i s
       own a s t o a h a l f i n t e r e s t i n t r u s t f o r t h e
       d e f e n d a n t . F o r t h i s i n t e r e s t he p a i d n o t h i n g ,
       and s o f a r a s a p p e a r s from h i s e v i d e n c e he d i d
       n o t a g r e e t o pay a n y t h i n g .         I f t h e agreement was
       made, t h e p l a i n t i f f ' s r e f u s a l t o c a r r y it o u t
       amounts t o a b r e a c h of c o n t r a c t o r agreement
       which c a n n o t be proved e x c e p t by w r i t i n g whether
       it comes under t h e 4 t h o r 7 t h s e c t i o n s .               M y
       conclusion, t h e r e f o r e , is t h a t the counterclaim
       f a i l s because of an absence of a w r i t i n g e v i d -
       e n c i n g t h e t r u s t a s r e q u i r e d by t h e 7 t h s e c t i o n
       of t h e S t a t u t e of Frauds.
 104
        C l e a r l y Mathers C. J. i s c o r r e c t .         The f a i l u r e t o g i v e
e f f e c t t o a m e r e t r u s t d e c l a r a t i o n a l l e g e d l y made p u r s u a n t
t o a c o n t r a c t t o convey does n o t u n j u s t l y e n r i c h t h e t r u s t
d e c l a r e r a t t h e expense of t h e t r u s t b e n e f i c i a r y . The land
was always t h e t r u s t e e ' s ; what t h e b e n e f i c i a r y has l o s t i s
h i s e x p e c t a t i o n of c o n t r a c t performance and it i s on t h e b a s i s
o f e n f o r c e a b i l i t y of t h e c o n t r a c t t h a t such a c a s e should
be decided. Likewise, i n t h e c a s e of an o r a l t r u s t d e c l a r a -
t i o n made by way of g i f t , t h e r e i s no u n j u s t enrichment; t h e
t r u s t d e c l a r e r has simply f a i l e d t o p e r f e c t a g i f t .

C.     E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform


        Some commentators have recommended r e p e a l of s e c t i o n s 7
and 8 of t h e S t a t u t e of Frauds on t h e assumption t h a t it has
been j u d i c i a l l y r e p e a l e d (by t h e use of r e s u l t i n g and con-
s t r u c t i v e t r u s t s and t h e e q u i t a b l e d o c t r i n e of f r a u d ) i n any
event.       For example, t h e B r i t i s h Columbia Law Reform
Commission s t a t e s a t 119 of i t s Working Paper:


        I t does n o t appear t o us t h a t s e r i o u s harm has
        r e s u l t e d from what most c o n s i d e r t o be t h e j u d i c i a l
        r e p e a l of s e c t i o n s 2 ( 2 ) and 3 [ t h e R.C. e q u i v a l e n t s
        of s e c t i o n s 8 and 91 a s they apply t o t r u s t s , and
          e
        w can p e r c e i v e no compelling r e a s o n s f o r s u p p o r t i n g
        t h e i r continuing existence.

        I n Waters, 201, t h e a u t h o r a r g u e s :


        The o b j e c t of t h e S t a t u t e i n 1677 was t o p r o t e c t
        t h e c o u r t s from having t o s i f t t h e t r u t h from
        c o n s t a n t l y p e r j u r e d evidence. During t h e 1 9 t h
        c e n t u r y it i s c l e a r t h a t t h e c o u r t s continued t o
        weigh o r a l evidence, and when they were s a t i s f i e d
        t h a t a t r u s t had been c r e a t e d , t h e S t a t u t e became
        a mere hindrance t o i t s enforcement. There seems
        no reason today why t h i s hindrance should n o t
        simply be removed.
                                                                                              105
       W e a r e of t h e o p i n i o n , however, t h a t t o t a l r e p e a l of
s e c t i o n 7 could have unintended e f f e c t s .


       F i r s t , i f t h e r e h a s been j u d i c i a l r e p e a l it has been o n l y
where land has been purchased on t r u s t f o r a n o t h e r o r where it
h a s been conveyed on t r u s t f o r a n o t h e r . A s w e have n o t e d ,
t h e r e has been no j u d i c i a l r e p e a l i n s o f a r a s v v m e r e " t r u s t
d e c l a r a t i o n s by an owner of land a r e concerned.                  Repeal of
s e c t i o n 7 could l e a d t o a s i t u a t i o n where a p u r c h a s e r under
a n unenforceable c o n t r a c t f o r s a l e , p u r s u a n t t o which t h e r e
h a s been no w r i t t e n conveyance, could s u c c e s s f u l l y c l a i m an
e q u i t a b l e i n t e r e s t on t h e b a s i s of an o r a l d e c l a r a t i o n of
trust.          I n e s s e n c e , he c o u l d argue t h a t t h e d e c l a r a t i o n of
t r u s t has e f f e c t i v e l y conveyed t h e e q u i t a b l e i n t e r e s t in t h e
l a n d t o him by way of c o n t r a c t u a l performance and while t h e
c o n t r a c t c a n n o t be e n f o r c e d , t h e u n e n f o r c e a b i l i t y of t h e
c o n t r a c t does n o t a l l o w a n executed c o n t r a c t t o be undone.
T h i s a p p e a r s t o be i n c o n s i s t e n t w i t h our recommendation t h a t
c o n t r a c t s t o convey land should have c e r t a i n f o r m a l i t i e s .
There i s a l s o no u n j u s t enrichment which would compel t h a t
s u c h t r u s t d e c l a r a t i o n s should be e n f o r c e a b l e . Likewise,
r e p e a l would p r o v i d e a mechanism f o r p e r f e c t i o n of g i f t s of
l a n d , which mechanism would n o t r e q u i r e any w r i t t e n conveyance,
n o r even t h e t a k i n g of p o s s e s s i o n of t h e l a n d . I f it i s
d e s i r a b l e t h a t g i f t s of l a n d should be p e r f e c t a b l e o n l y by
c e r t a i n f o r m a l i t i e s ( i n our d i s c u s s i o n i n Chapter V w e d i s -
cussed t h e arguments f o r and a g a i n s t such a p r o p o s i t i o n ) then
r e p e a l of s e c t i o n 7, by a l l o w i n g o r a l t r u s t d e c l a r a t i o n s ,
would be c o n t r a r y t o such a g o a l .

          Second, r e p e a l of s e c t i o n 7 would e s t a b l i s h w i t h f i n a l i t y
t h a t where A conveys t o T on t r u s t f o r B ( o r a l l y ) t h e t r u s t i s
e n f o r c e a b l e i n f a v o u r o f B, and n o t A. C l e a r l y , because of t h e
u n j u s t enrichment i n v o l v e d , T cannot be allowed t o hold f o r h i s
own use.            But it may be, a s a m a t t e r of p o l i c y , t h a t t h e t r u s t e e
T ought t o hold on b e h a l f of t h e g r a n t o r A,              e f f e c t i v e l y giving
A t h e c h o i c e of r e c r e a t i n g t h e t r u s t i n f a v o u r of B i n w r i t i n g .
I f t h i s i s d e s i r a b l e such a p o l i c y c o u l d be implemented by
l e g i s l a t i v e change.

         The main argument t o be made a g a i n s t e n f o r c i n g t h e o r a l
t r u s t i s t h a t what i s i n v o l v e d i s a d i s p o s i t i o n of a n interest
i n l a n d . W e have p r e v i o u s l y c h a r a c t e r i z e d such d i s p o s i t i o n s
a s b e i n g u n i q u e l y s i g n i f i c a n t and t h u s r e q u i r i n g c e r t a i n
f o r m a l i t i e s . Y e t t o e n f o r c e t h e t r u s t is t o g i v e e f f e c t t o an
o r a l d i s p o s i t i o n , p e r h a p s made g r a t u i t o u s l y .  The main r e a s o n
why t h e c o u r t s have, i n f a c t , i f n o t i n l a w , e n f o r c e d such
t r u s t s i s t h e n e c e s s i t y of p r o h i b i t i n g t h e t r u s t e e from h o l d i n g
f o r himself.            However, t h i s c a n be accomplished by implementing
a t r u s t i n f a v o u r of t h e i n i t i a l g r a n t o r .

        A p e r h a p s more c o m p e l l i n g argument c a n be made i n f a v o u r
o f enforcing the express o r a l t r u s t .                      I n o r d e r t o prove f r a u d
o n t h e p a r t of t h e t r u s t e e p a r 0 1 e v i d e n c e i s a d m i s s i b l e t o
p r o v e t h e f r a u d . Y e t , t h i s e v i d e n c e c o n s i s t s of n o t h i n g more
t h a n t h e e v i d e n c e of t h e e x p r e s s t r u s t .        I f t h e c o u r t s are
p r e s e n t l y w i l l i n g t o a c c e p t o r a l t e s t i m o n y of t h e t r u s t f o r
t h e p u r p o s e s of p r e v e n t i n g f r a u d , t h e r e a p p e a r s t o be no
e v i d e n t i a r y r e a s o n f o r n o t a l l o w i n g p a r o l e e v i d e n c e i n proof
o f t h e e x p r e s s t r u s t s i m p l i c i t e r . Nor would it s e e m are t h e r e
any c a u t i o n a r y o b j e c t i v e s t o be g a i n e d by n o t e n f o r c i n g t h e
express t r u s t .           The g r a n t o r i n t r a n s f e r r i n g t h e l a n d t o t h e
t r u s t e e w i l l have a l r e a d y had t h e c a u t i o n a r y p r o t e c t i o n of
o n e f o r m a l i t y , t h e conveyance i n w r i t i n g .

          I n sum, i f s e c t i o n 7 i s r e p e a l e d o r a l t r u s t s e t t l e m e n t s
w i l l be e n f o r c e a b l e (as t h e y are now f o r a l l p r a c t i c a l p u r p o s e s ) .
However, " m e r e " o r a l t r u s t d e c l a r a t i o n s , which are n o t p r e s e n t l y
e n f o r c e d , w i l l a l s o be e n f o r c e a b l e . T h i s may n o t be d e s i r a b l e .
                                                                                                107
        I f s e c t i o n 7 i s n o t r e p e a l e d , we have no r e a s o n t o t h i n k
t h a t j u d i c i a l a t t i t u d e s w i l l change i n s o f a r as p u r c h a s e s o r
conveyances made on t r u s t a r e concerned.                        They w i l l c o n t i n u e
t o be enforced under t h e d o c t r i n e of Rochefoucauld v. Boustead.
"Mere" o r a l t r u s t d e c l a r a t i o n s by an owner o f l a n d w i l l ,
however, c o n t i n u e t o be u n e n f o r c e a b l e .


       W e i n v i t e comment on t h e f o l l o w i n g Q u e s t i o n s .


QUESTION 26


       Should s e c t i o n 7 o f t h e S t a t u t e of F r a u d s , which
       r e q u i r e s d e c l a r a t i o n s o r c r e a t i o n s o f ' t r u s t s of
       l a n d t o be i n w r i t i n g , be r e p e a l e d ?


OUESTION 27


       I f s e c t i o n 7 i s n o t r e p e a l e d should an a p p l i c a t i o n
       of t h e e q u i t a b l e d o c t r i n e of f r a u d r e q u i r e a
       t r u s t i n favour of t h e g r a n t o r o r purchaser?


        W have n o t e d a l r e a d y t h a t t h e p r e s e n t r e q u i r e m e n t i s n o t
          e
t h a t t h e d e c l a r a t i o n of c r e a t i o n of t r u s t be i n w r i t i n g , b u t
o n l y t h a t it be p r o v e d by some w r i t i n g .            Hence a w r i t , i n g sub-
s e q u e n t t o t h e t r u s t c r e a t i o n can be s u f f i c i e n t .


        I t i s , however,         a r g u a b l e t h a t a l a t e r memorandum s h o u l d
- be
not        sufficient.           I f cautioning the s e t t l o r o r t r u s t declarer
i s t h e major purpose of t h e requirement of w r i t i n g f o r t r u s t s ,
t h i s c a u t i o n a r y f u n c t i o n w i l l n o t be s e r v e d by a p o s s i b i l i t y
of a memorandum s u b s e q u e n t t o t h e t r u s t c r e a t i o n .          e
                                                                                 W invite
comment on t h e f o l l o w i n g q u e s t i o n .
108
Question 27A

     If section 7 is not repealed, how much writing should
     be sufficient to satisfy the Statute?

     Section 7 only applies to the creation of trusts in respect
of land, not personalty. On the assumption that section 7
will not be repealed, it remains to be considered whether the
section 7 ought to be extended to cover trust declarations
of personalty. (Presumably, even if section 7 were generally
worded to cover trusts of land and personalty, trusts of
personalty created by way of transfer would be dealt with
judicially, in the same manner as trusts created by way of
transfer of land.)

     The main arguments to be made in favour of extending
section 7 in the above way are:

     (1)   It is necessary for the cautionary protection of
           individuals. Without such a requirement the
           possibility exists that an individual can gift
           personalty by way of an oral trust declaration
           only, There would not even have to be a transfer
           of possession of the chattel in question, In
           short, there would be nothing in the way of
           cautionary protection, which, as we have argued
           elsewhere, is extremely important in the case
           of gratuitous dispositions.

     (2) There would be consistency in the legal treatment
         of declarations of trust in respect of both land
         and chattels. (This would overcome problems such
         as exist where the alleged -trust declaration is
         of - land and chattels.)
            both
                                                                                            109
The main argument a g a i n s t e x t e n d i n g t h e law s o a s t o c o v e r
t r u s t d e c l a r a t i o n s of p e r s o n a l t y i s t h a t t h e consequences of
s u c h a change a r e u n p r e d i c t a b l e . A s w e have n o t e d h a s been
t h e c a s e w i t h a t l e a s t some s e c t i o n s o f t h e S t a t u t e o f F r a u d s ,
i n i t s o v e r 300-year h i s t o r y , a r e q u i r e m e n t of w r i t i n g c a n
c a u s e more i n j u s t i c e t h a n it p r e v e n t s .

       W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n .


Q u e s t i o n 27B

        Should t h e r e be a w r i t i n g r e q u i r e m e n t f o r c r e a t i o n
        of t r u s t s by d e c l a r a t i o n i n p e r s o n a l t y ?
                                      CHAPTER V I I I

 SECTION 9:                                F
                   GRANTS AND ASSIGNMENTS O TRUSTS AND CONFIDENCES

A.     Operation

       S e c t i o n 9 of t h e S t a t u t e of Fraud p r o v i d e s :

       And be it f u r t h e r e n a c t e d , That a l l g r a n t s and
       assignments of any t r u s t o r c o n f i d e n c e s h a l l
       l i k e w i s e be i n w r i t i n g , signed by t h e p a r t y
       g r a n t i n g o r a s s i g n i n g t h e same, o r by such l a s t
       w i l l o r d e v i s e , o r else s h a l l l i k e w i s e by u t t e r l y
       void and of none e f f e c t .


                                                                            (
The modern E n g l i s h p r o v i s i o n i s found in s e c t i o n 53 (1) c )
of t h e Law of P r o p e r t y A c t , 1925:

       A d i s p o s i t i o n of an e q u i t a b l e i n t e r e s t o r t r u s t
       s u b s i s t i n g a t t h e time of d i s p o s i t i o n , must be
       i n w r i t i n g s i g n e d by t h e person d i s p o s i n g of t h e
       same, o r by h i s a g e n t t h e r e u n t o l a w f u l l y a u t h o r i z e d
       i n w r i t i n g o r by w i l l .

     There have been no Canadian c a s e s i n t e r p r e t i n g s e c t i o n 9
and o n l y a few on t h e e q u i v a l e n t s e c t i o n i n England. Unlike
s e c t i o n 4 and 7 of t h e S t a t u t e which o n l y r e q u i r e w r i t t e n
evidence, t h i s s e c t i o n r e q u i r e s t h a t t h e " g r a n t " o r "assign-
ment" - i n w r i t i n g .
      be                       By t h e wording i n t h e s e c t i o n non-
compliance r e n d e r s t h e g r a n t o r assignment " u t t e r l y void and
o f none e f f e c t . "  D e s p i t e t h e f a c t t h a t t h e wording i s t h e
same a s i n s e c t i o n 7 , s e c t i o n 9 has always been i n t e r p r e t e d
literally.        According t o P e t t i t , E q u i t y and t h e Law of T r u s t s ,
53:

       The r e q u i r e m e n t t h a t t h e d i s p o s i t i o n must a c t u a l l y
       be i n w r i t i n g , i f n o t complied w i t h a t t h e time,
       c l e a r l y c a n n o t be r e c t i f i e d s u b s e q u e n t l y , and
       a c c o r d i n g l y it always seems t o have been assumed
       t h a t absence of w r i t i n g makes t h e p u r p o r t e d
       d i s p o s i t i o n void.
       The s e c t i o n r e f e r s t o - g r a n t s o r a s s i g n m e n t s of t r u s t s
                                            all
o r c o n f i d e n c e s , whether of r e a l t y o r p e r s o n a l t y .    Thus i n Grey
v. I.R.C.         [I9601 A.C. 1, t h e E n g l i s h s u c c e s s o r t o s e c t i o n 9
w a s a p p l i e d t o a p u r p o r t e d o r a l d i s p o s i t i o n by a b e n e f i c i a r y
o f a t r u s t of s h a r e s .     According t o Waters, p. 187, t h e p h r a s e
" g r a n t s and a s s i g n m e n t s o f any t r u s t o r c o n f i d e n c e " r e f e r s t o
equitable interests.                 For a l l p r a c t i c a l p u r p o s e s t h e r e f o r e , t h e
s e c t i o n c a n o n l y come i n t o o p e r a t i o n when a p a r t y p u r p o r t s t o
g r a n t o r a s s i g n h i s b e n e f i c i a l i n t e r e s t under a t r u s t .

          Perhaps t h e most d i f f i c u l t problem in t h i s a r e a is t h e
meaning of t h e words " g r a n t s and a s s i g n m e n t s " .              I t most p r o b a b l y
d o e s n o t i n c l u d e t h e c r e a t i o n o f a n e q u i t a b l e i n t e r e s t , where
none e x i s t e d b e f o r e , by means o f a t r u s t d e c l a r a t i o n o r s e t t l e -
ment.        I n Grey v. I.R.C.              [1960] A.C. 1, a t 16 Lord ~ a d c l i f f e ,
i n c o n s i d e r i n g whether a d e c l a r a t i o n of t r u s t of a b e n e f i c i a l
i n t e r e s t f e l l w i t h i n s e c t i o n 9, commented :

                y
        I n m o p i n i o n , it i s a v e r y n i c e q u e s t i o n whether
        a p a r 0 1 d e c l a r a t i o n o f t r u s t of t h i s k i n d w a s o r
        w a s n o t w i t h i n t h e m i s c h i e f of s e c t i o n 9 of t h e
        S t a t u t e of F r a u d s .     The p o i n t h a s n e v e r , I b e l i e v e ,
        been d e c i d e d and p e r h a p s it n e v e r w i l l be.
        C e r t a i n l y it w a s l o n g e s t a b l i s h e d as l a w t h a t
        while a d e c l a r a t i o n of t r u s t r e s p e c t i n g land o r
        any i n t e r e s t t h e r e i n r e q u i r e d w r i t i n g t o be
        e f f e c t i v e , a d e c l a r a t i o n of t r u s t r e s p e c t i n g
        personalty did not.

        On t h e same p o i n t Waters s t a t e s , a t p.               192:

         ...i f the person with a b e n e f i c i a l i n t e r e s t d e c l a r e s
        himself a t r u s t e e of t h a t interest f o r a n o t h e r , he
        i s c r e a t i n g a t r u s t , and p r o v i d e d t h e t r u s t p r o p e r t y
        i s p e r s o n a l t y t h e t r u s t i s e n f o r c e a b l e though t h e
        declaration is oral.

        I f a d e c l a r a t i o n o f t r u s t of a b e n e f i c i a l interest is n o t
a " g r a n t " o r " a s s i g n m e n t " of such i n t e r e s t , t h e n t h e c r e a t i o n
of such an i n t e r e s t by way of t r u s t d e c l a r a t i o n ( o r s e t t l e m e n t )
i s n o t a g r a n t o r assignment.                  Indeed, t h i s i s e x p l i c i t l y
recognized i n t h e E n g l i s h successor p r o v i s i o n , which r e f e r s t o
d i s p o s i t i o n s of e q u i t a b l e i n t e r e s t o r t r u s t s " s u b s i s t i n g a t the
time of d i s p o s i t i o n . "        (Quaere whether t h e absence of t h e s e
words i n t h e o r i g i n a l S t a t u t e can support an argument t h a t "a
d e c l a r a t i o n of t r u s t over p r o p e r t y , t h e l e g a l and e q u i t a b l e
i n t e r e s t s in which a r e i n t h e s e t t l o r , comes w i t h i n s e c t i o n 9,
i n s o f a r a s an e q u i t a b l e i n t e r e s t i s v e s t e d i n a n o t h e r a s a
r e s u l t of t h e declaration?"--Waters, 188, n. 6 3 )                        .
        A d i f f i c u l t i s s u e i s whether an o r a l d i r e c t i o n t o
t r u s t e e s t o hold f o r a n o t h e r , by a b e n e f i c i a r y of a t r u s t ,
c o n s t i t u t e s a g r a n t o r assignment.            I n Grey v. I . R . C .       the
House of Lords h e l d t h i s t o be a " d i s p o s i t i o n " under t h e
English Law of P r o p e r t y Act.  Since t h e word " d i s p o s i t i o n "
does seem t o be broader i n scope than " g r a n t and assignment,                                  I'


it i s l a r g e l y a m a t t e r of s p e c u l a t i o n whether such a d i r e c t i o n
i s a l s o a g r a n t o r assignment under s e c t i o n 9.                  The argument
t h a t o r a l d i r e c t i o n s t o a t r u s t e e a r e n o t g r a n t s o r assignments
i s based on t h e s u p p o s i t i o n t h a t such d i r e c t i o n s a r e e q u i v a l e n t
t o a t r u s t d e c l a r a t i o n which i s n o t c o n s i d e r e d a g r a n t o r
assignment.-- (See d i s c u s s i o n of Grey v.               I.R.C.     i n Waters
189).


          Two f u r t h e r i s s u e s must be c o n s i d e r e d .       I n Vandervell v.
I.R.C.,                                                    a
                119671 2 A.C. 2 9 1 (H.L.) it w s h e l d t h a t an o r a l
d i r e c t i o n t o a t r u s t e e t o p a s s both t h e l e g a l and e q u i t a b l e
i n t e r e s t i n s h a r e s t o a n o t h e r was n o t "a d i s p o s i t i o n of an
e q u i t a b l e i n t e r e s t o r t r u s t " (and presumably not a g r a n t o r
assignment).            Lord Upjohn s t a t e d , a t 311, t h e r e a s o n f o r t h i s
conclusion :

          ...      t h e o b j e c t of t h e s e c t i o n , a s w s t h e o b j e c t
                                                                   a
          of t h e o l d S t a t u t e of Frauds, i s t o p r e v e n t hidden
          o r a l transactions i n equitable i n t e r e s t s i n fraud
        of t h o s e t r u l y e n t i t l e d , and making it d i f f i c u l t ,
        i f not impossible, f o r the t r u s t e e s t o a s c e r t a i n
        who a r e i n t r u t h h i s b e n e f i c i a r i e s . But when t h e
        b e n e f i c i a l owner owns t h e whole b e n e f i c i a l e s t a t e
        and i s in a p o s i t i o n t o g i v e d i r e c t i o n s t o h i s
        bare t r u s t e e with regard t o the l e g a l a s w e l l a s
        t h e e q u i t a b l e e s t a t e t h e r e can be no p o s s i b l e
        ground f o r invoking t h e s e c t i o n where t h e b e n e f i c i a l
        owner wants t o d e a l w i t h t h e l e g a l e s t a t e a s w e l l
        a s the equitable estate.

          F i n a l l y , i n Oughtred v. I.R.C.,               [I9601 A.C. 206 t h e r e a r e
d i c t a t o t h e e f f e c t t h a t where an owner of an e q u i t a b l e i n t e r -
est i n personalty (in t h i s case a reversionary i n t e r e s t i n
s h a r e s ) c o n t r a c t s t o s e l l h i s e q u i t a b l e interest t o a n o t h e r , a
c o n s t r u c t i v e t r u s t a r i s e s (by r e a s o n of t h e p u r c h a s e r ' s r i g h t
t o s p e c i f i c performance) i n f a v o u r of t h e p u r c h a s e r , and t h a t
such t r u s t i s excepted from t h e r e q u i r e m e n t of w r i t i n g by
s. 53 (2) of t h e Law of P r o p e r t y Act, t h e E n g l i s h e q u i v a l e n t
o f s. 8 of t h e S t a t u t e of Frauds.                  That was, a t any r a t e , t h e
o p i n i o n of Lord R a d c l i f f e , a t 227-228.              However, Lords J e n k i n s
and K e i t h d i d n o t f e e l compelled t o d e c i d e t h i s q u e s t i o n and
Lord Denning, a t 233, and Lord Cohen, a t 230 b o t h t h o u g h t a
                 a
writing w s s t i l l required t o transfer the reversionary
i n t e r e s t . T h i s c o n c e p t o f a c o n s t r u c t i v e t r u s t a s an e x c e p t i o n
t o s. 9 h a s a l s o been doubted by Waters, a t 192.

B.      E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform

         I n a t t e m p t i n g t o e v a l u a t e s. 9 from t h e p o i n t of view
o f p u b l i c p o l i c y we have been impressed by t h e f a c t t h a t
t h e r e h a s been no Canadian l i t i g a t i o n i n v o l v i n g t h e s e c t i o n
and t h e E n g l i s h c a s e s on t h e Law o f P r o p e r t y Act e q u i v a l e n t
have r e a l l y been t a x a t i o n c a s e s in which t h e v a l i d i t y of t h e
d i s p o s i t i o n h a s r i s e n o n l y i n d i r e c t l y in t h e c o n t e x t of a
d i s p u t e between a t a x p a y e r and t h e revenue a u t h o r i t i e s .
There appear t o be no c a s e s i n v o l v i n g a d i r e c t d i s p u t e between
a g r a n t o r and g r a n t e e , o r between t r u s t e e and g r a n t e e . One
p o s s i b l e reason f o r t h e absence of l i t i g a t i o n i s t h a t most
owners of i n t e r e s t s under t r u s t s who wish t o t r a n s f e r t h e i r
i n t e r e s t do so through t h e i r lawyers, who promptly p u t the
t r a n s a c t i o n i n w r i t i n g . An i n t e r e s t under a t r u s t fund is,
a f t e r a l l , i n t a n g i b l e p r o p e r t y with which most people a r e not
accustomed t o d e a l i n g .            This t o t a l absence of l i t i g a t i o n , f o r
whatever reason, i n i t s e l f suggests t h a t r e p e a l would occasion
l i t t l e harm.


          Probably t h e r e a s o n f o r t h e s e c t i o n ' s i n i t i a l enactment
was, a s w have a l r e a d y noted, f o r t h e p r o t e c t i o n of t h e
t r u s t e e . I t was t o e n a b l e t h e t r u s t e e t o know with c e r t a i n t y
who were h i s b e n e f i c i a r i e s . However t h i s i n t e r e s t i n pro-
t e c t i n g t h e t r u s t e e i s a l r e a d y accomplished t o a c e r t a i n
e x t e n t , under t h e law of assignment. A t e q u i t y , an assignment,
while v a l i d between a s s i g n o r and a s s i g n e e a s of t h e d a t e of
assignment, i s b i n d i n g on t h e d e b t o r ( i n t h e c a s e of a t r u s t ,
t h e t r u s t e e ) o n l y a s of t h e d a t e of n o t i c e t o t h e debtor.--
Stocks v. Dobson (1853) 4 D e . G.M. & G. 11. However, such
n o t i c e need n o t be i n w r i t i n g t o be effective.--Anson1s
Law of C o n t r a c t 431, (24th ed., 1975)             .
       If t h e p r o t e c t i o n of t h e t r u s t e e w s the reason f o r t h e
                                                            a
enactment of s. 9 it i s somewhat odd t h a t t h e g r a n t o r
assignment of t h e e q u i t a b l e i n t e r e s t must be in w r i t i n g ,
                -
whereas an o r a l n o t i c e t o t h e t r u s t e e i s s u f f i c i e n t . Surely
it i s t h e n o t i c e   t h e t r u s t e e which       critical.

        If it i s thought t h a t t h e p r e s e n t r u l e s r e l a t i n g t o
n o t i c e of assignment do n o t provide s u f f i c i e n t p r o t e c t i o n
t o a t r u s t e e it would s t i l l be p o s s i b l e t o p r o v i d e even b e t t e r
p r o t e c t i o n and s t i l l r e p e a l s e c t i o n 9. A p r o v i s i o n could be
s u b s t i t u t e d t h a t a g r a n t o r assignment of an e q u i t a b l e interest
                                     -
i s e f f e c t i v e a s a g a i n s t t h e t r u s t e e only from t h e time t h e
t r u s t e e r e c e i v e s n o t i c e i n w r i t i n g signed by t h e a s s i g n o r o r
grantor.         T h i s would p e r m i t a n o r a l d i s p o s i t i o n between
a s s i g n o r and a s s i g n e e , b u t t h e t r u s t e e would be d i s c h a r g e d t o
t h e e x t e n t t h a t he had p a i d o u t money o r t r a n s f e r r e d p e r s o n a l
property before receiving notice i n writing.

          Apart from p r o t e c t i n g t h e t r u s t e e , t h e r e seems t o be no
r e a s o n f o r r e q u i r i n g g r a n t s o r a s s i g n m e n t s of e q u i t a b l e i n t e r -
e s t s i n p e r s o n a l t y t o be i n w r i t i n g , and n o t g r a n t s of t h e
merged l e g a l and e q u i t a b l e i n t e r e s t s i n p e r s o n a l t y .    I t must
b e emphasized t h a t conveyances of i n t e r e s t s in r e a l p r o p e r t y
and c r e a t i o n s of t r u s t s i n r e a l p r o p e r t y a r e r e q u i r e d t o be in
w r i t i n g under o t h e r s e c t i o n s of t h e S t a t u t e d i s c u s s e d i n
previous chapters.                W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n s .


QUESTION 28

        Should t h e r e q u i r e m e n t of s e c t i o n 9 of t h e S t a t u t e
        of Frauds t h a t g r a n t s and a s s i g n m e n t s of t r u s t s o r
        c o n f i d e n c e s be i n w r i t i n g , be r e p e a l e d ?

QUESTION 29

        I f s e c t i o n 9 i s r e p e a l e d , should a p r o v i s i o n be
        e n a c t e d t h a t g r a n t s and a s s i g n m e n t s of i n t e r e s t s
        under a t r u s t a r e e f f e c t i v e as a g a i n s t t h e t r u s t e e
        o n l y from t h e time a t r u s t e e r e c e i v e s n o t i c e i n
        w r i t i n g s i g n e d by t h e g r a n t o r o r a s s i g n o r ?
 116
                                           CHAPTER I X

        SECTION 4:                                              PN
                             CONTRACTS TO CHARGE THE DEFENDANT U O A
                                  NW R
              SPECIAL PROMISE TO A S E FOR THE DEBT, DEFAULT
                     OR MISCARRIAGES OF ANOTHER PERSON


        This i s t h e second of f i v e c a t e g o r i e s of c o n t r a c t s covered
by s e c t i o n 4 of t h e S t a t u t e of Frauds.                 A s with a l l the cate-
g o r i e s under s e c t i o n 4 t h e requirement of w r i t i n g can be
s a t i s f i e d by a n o t e o r memorandum and non-compliance r e n d e r s
t h e c o n t r a c t u n e n f o r c e a b l e and n o t void.

A.      Scope of A p p l i c a t i o n


        This wording of t h i s c l a u s e i s ambiguous and has l e d t o
c o n s i d e r a b l e c o n f u s i o n i n t h e c a s e law.       I n the f i r s t place,
it i s d i f f i c u l t t o d i s t i n g u i s h among t h e words " d e b t , "
" d e f a u l t " and " m i s c a r r i a g e s . " The word " m i s c a r r i a g e " was
i n t e r p r e t e d i n Kirkham v. Marter ( 1 8 1 9 ) , 2 B. & Ald. 613 a s
referring to a l i a b i l i t y in tort.      "Debt" r e f e r s t o a
c o n t r a c t u a l l i a b i l i t y a l r e a d y i n c u r r e d and " d e f a u l t " r e f e r s
t o a f u t u r e l i a b i l i t y . --18     ~ a l s b u r y ' s 4 2 4 (3rd ed.,         1957).

         The words " a n o t h e r person" have been i n t e r p r e t e d so
t h a t c o n t r a c t s f a l l i n g w i t h i n t h i s c a t e g o r y must be ones of
g u a r a n t e e and n o t indemnity.              The t e s t f o r d i s t i n g u i s h i n g
between t h e two was e s t a b l i s h e d a s e a r l y a s 1704 i n Birkmyr
v.     D a r n e l l (1704) 1 S a l k . 27 (K.B.):


        I f trm come t o a shop, and one buys, and t h e
        o t h e r , t o g a i n him c r e d i t , promises t h e s e l l e r ,
        i f he does n o t pay you, I w i l l ; t h i s i s a
        c o l l a t e r a l u n d e r t a k i n g , and void w i t h o u t w r i t i n g ,
        by t h e S t a t u t e of Frauds:              but i f he s a y s , l e t   -
        him have t h e goods, I w i l l be your paymaster o r
        I w i l l s e e you p a i d , t h i s i s an undertaking a s
        f o r h i m s e l f , and he s h a l l be intended t o be t h e
        v e r y buyer and t h e o t h e r t o a c t b u t a s h i s s e r v a n t .
         L i a b i l i t y under a g u a r a n t e e , t h e r e f o r e , a r i s e s only upon
d e f a u l t of a n o t h e r . I t i s " c o l l a t e r a l " t o t h e primary o b l i g a -
t i o n of a n o t h e r p e r s o n .   L i a b i l i t y under an indemnity i s
" o r i g i n a l " ; it a c c r u e s w i t h o u t r e g a r d t o whether "any o t h e r
person" i s i n d e f a u l t .

         To be w i t h i n t h e S t a t u t e , t h e promise must be made to a
c r e d i t o r of t h e p r i n c i p a l d e b t o r . Thus, i n - Bolton ( 1 8 9 2 ) ,
                                                                   Re
8 T.L.R.       668, t h e d e f e n d a n t was a s h a r e h o l d e r i n a company
which r e q u i r e d some money.            A bank agreed t o l e n d t h e money
on the condition t h a t t h e defendant's s o l i c i t o r s guarantee
t h e d e b t . The s o l i c i t o r s a g r e e d t o t h i s g u a r a n t e e and the
d e f e n d a n t in t u r n a g r e e d t o r e p a y t h e s o l i c i t o r s should t h e y
b e r e q u i r e d t o pay under t h e g u a r a n t e e .       A s the s o l i c i t o r s
w e r e n o t c r e d i t o r s of t h e company, t h e promise of t h e defen-
d a n t was n o t w i t h i n t h e S t a t u t e . However, it i s n o t n e c e s s a r y
f o r t h e l i a b i l i t y t o be i n e x i s t e n c e a t t h e time t h e d e f e n d a n t
e n t e r s i n t o t h e c o n t r a c t o f guarantee.--Jones v. Cooper ( 1 7 7 4 ) ,
1 Cowp. 227.


        Guarantees which a r e a m e r e i n c i d e n t of a l a r g e r c o n t r a c t
have k e n t r e a t e d a s e x c e p t e d from t h e S t a t u t e .       This exception
h a s o p e r a t e d in two t y p e s of c a s e s .        The f i r s t i s where the
                         -
g u a r a n t o r i s a d e l c r e d e r e a g e n t o r an a g e n t "who, f o r the
e x t r a commission u n d e r t a k e s r e s p o n s i b i l i t y f o r the due per-
formance of         ...      c o n t r a c t s by p e r s o n s whom he i n t r o d u c e s
t o h i s principal."--Cheshire               &   F i f o o t 180,   ( 8 t h ed.,    1972).
Here,     t h e g u a r a n t e e i s merely i n c i d e n t a l o r a n c i l l a r y t o
t h e l a r g e r c o n t r a c t of p r i n c i p a l and a g e n t .

         The o t h e r t y p e of g u a r a n t e e c o n s i d e r e d i n c i d e n t a l t o a
l a r g e r t r a n s a c t i o n o c c u r s where t h e g u a r a n t e e i s given t o
p r o t e c t t h e g u a r a n t o r ' s own p r o p e r t y . This is i l l u s t r a t e d i n
F i t z g e r a l d v. Dressler ( 1 8 5 9 ) , 7 C.B. N.S. 374 where A s o l d
goods t o B who r e s o l d them t o C. A had r e t a i n e d a l i e n o v e r
t h e goods and C g u a r a n t e e d payment t o A by B i n c o n s i d e r a t i o n
of A d e l i v e r i n g t h e goods t o C.    This was held t o be a
guarantee, but o u t s i d e t h e S t a t u t e . This e x c e p t i o n does not
a p p l y where t h e g u a r a n t o r has o n l y a p e r s o n a l , a s compared t o
a p r o p r i e t a r y , i n t e r e s t i n t h e goods.      Thus i n Harburg I n d i a
Rubber Comb Co. v. Martin,                   [I9021 1 K.B.         778, where t h e
defendant o r a l l y g u a r a n t e e d t h e n o t e s of a company i n which
he was a s u b s t a n t i a l s h a r e h o l d e r i n c o n s i d e r a t i o n of t h e
p l a i n t i f f withdrawing a w r i t of e x e c u t i o n a g a i n s t t h e company,
t h i s was h e l d t o be w i t h i n t h e S t a t u t e of Frauds.

     Besides t h e p r o t e c t i o n given a g u a r a n t o r by t h e S t a t u t e
of Frauds, f u r t h e r f o r m a l i t i e s a r e provided f o r some g u a r a n t e e s
under t h e Guarantees Acknowledgement Act, R.S.A.                   1970, c. 163.
That Act b a s i c a l l y p r o v i d e s t h a t g u a r a n t e e s t o which t h e Act
a p p l i e s s h a l l have no e f f e c t u n l e s s t h e g u a r a n t o r appears
b e f o r e a n o t a r y p u b l i c , acknowledges t h a t he executed t h e
g u a r a n t e e , and s i g n s a n o t a r i a l c e r t i f i c a t e in t h e presence
of t h e n o t a r y p u b l i c i n a p r e s c r i b e d form.          The p r e s c r i b e d
C e r t i f i c a t e of Notary P u b l i c r e q u i r e s t h e Notary t o s t a t e
t h a t he i s s a t i s f i e d t h a t t h e g u a r a n t o r 'I.   ..    i s aware of
t h e c o n t e n t s of t h e g u a r a n t e e and u n d e r s t a n d s it." The
purpose of t h e Guarantees Acknowledge Act i s s t a t e d i n our
Report on t h e Guarantees Acknowledgement Act, a t 2:

        ...        t h e Guarantees Acknowledgement Act i s
        designed t o p r o t e c t t h e o r d i n a r y i n d i v i d u a l who,
        through l a c k of e x p e r i e n c e o r u n d e r s t a n d i n g ,
        might o t h e r w i s e f i n d himself s u b j e c t t o onerous
        l i a b i l i t i e s a t law t h e n a t u r e and e x t e n t of which
        he d i d n o t p r o p e r l y a p p r e c i a t e when he e n t e r e d
        i n t o t h e u n d e r t a k i n g in q u e s t i o n .

       I n our Report, we recommended, a t 5, t h a t t h i s Act should
be r e t a i n e d .
B.     E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform

          Given our recommendation i n our Report on the Guarantees
Acknowledgement Act t h a t t h e f o r m a l i t i e s p r e s c r i b e d i n t h a t
Act should be r e t a i n e d , we can s e e no u s e f u l purpose t h a t
would be served by r e p e a l i n g t h e less onerous e v i d e n t i a r y
p r o v i s i o n s in t h e S t a t u t e of Frauds. W e a l s o s t a t e d , a t page 8
of our Report, t h a t it w a s considered d e s i r a b l e t h a t t h e S t a t u t e
of Frauds and t h e Guarantees Acknowledgement Act should c o r r e s -
pond i n r e s p e c t of t h e g u a r a n t e e s covered by each A c t .        They
d i f f e r in coverage in s e v e r a l m a t e r i a l a s p e c t s .

        F i r s t , t h e Guarantees Acknowledgement A c t d e f i n e s g u a r a n t e e
a s a "deed o r w r i t t e n i n s t r u m e n t " and p r o v i d e s t h a t g u a r a n t e e s
n o t complying w i t h t h e A c t s h a l l have no e f f e c t . The S t a t u t e
of Frauds, on t h e o t h e r hand, a p p l i e s t o o r a l g u a r a n t e e s , can
be complied w i t h by a " n o t e o r memorandum" subsequent t o an
o r a l g u a r a n t e e , and non-compliance merely r e n d e r s t h e g u a r a n t e e
unenforceable.              Thus it would be t h e o r e t i c a l l y p o s s i b l e t o
have an o r a l g u a r a n t e e w i t h a subsequent n o t e o r memorandum
which t h u s s a t i s f i e d t h e S t a t u t e of Frauds, and which d i d n o t
f a l l w i t h i n t h e p r o t e c t i o n of t h e Guarantees Acknowledgement
A c t s i n c e it w a s n o t a "deed o r w r i t t e n agreement" under t h a t
Act.


          Another p o s s i b l e unintended r e s u l t of t h e absence of
u n i f o r m i t y between t h e two S t a t u t e s i s t h a t money p a i d under
a n o r a l g u a r a n t e e might be i r r e c o v e r a b l e . The g u a r a n t e e being
o r a l m u l d n o t come w i t h i n t h e p r o t e c t i o n of t h e Guarantees
Acknowledgement A c t .             The S t a t u t e of Frauds would l i k e w i s e
p r o v i d e no relief s i n c e , because t h e e f f e c t of non-compliance
i s o n l y t o p r e v e n t an a c t i o n , t h e c r e d i t o r could r a i s e t h e o r a l
g u a r a n t e e by way of d e f e n c e t o any a c t i o n by a g u a r a n t o r t o
recover t h e money p a i d . Both of t h e s e unintended p o s s i b i l i t i e s
could be avoided by simply i n c l u d i n g " o r a l c o n t r a c t s " w i t h i n
t h e d e f i n i t i o n of g u a r a n t e e under t h e Guarantees Acknowledgement
Act.
QUESTION 30

       Should t h e d e f i n i t i o n of guarantee under t h e
       Guarantees Acknowledgement Act be broadened t o
       include o r a l c o n t r a c t s ?

       A second m a t e r i a l d i f f e r e n c e between t h e two S t a t u t e s is
t h a t under s. 2 ( a ) ( i v ) of t h e Guarantees Acknowledgement A c t
guarantees given on t h e s a l e of any i n t e r e s t in land, goods,
or c h a t t e l s a r e excepted from t h e p r o v i s i o n s of t h a t Act.
T h e r e is no such e x c e p t i o n under the S t a t u t e of Frauds.        In
o u r Report on t h e Guarantees Acknowledgement Act, we did,
however, recommend, a t 12-13 t h a t this e x c e p t i o n be d e l e t e d .
I f t h i s recommendation i s accepted t h e two S t a t u t e s w i l l be
uniform in t h a t r e s p e c t .

OUESTION 30A

       Should t h e e x c e p t i o n contained i n s e c t i o n 2 ( a ) ( i v )
       of t h e Guarantees Ac.knowledgment Act be d e l e t e d ?



       A t h i r d a r e a of d i f f e r e n c e i s t h a t guarantees given by
c o r p o r a t i o n s a r e excepted under t h e Guarantees Acknowledgement
Act, s. 2 ( a ) , whereas they a r e n o t excepted under t h e S t a t u t e
of Frauds. I n our Report on t h e Guarantees Acknowledgement
Act w e recommended t h a t t h e Act not be extended t o cover
guarantees given by c o r p o r a t i o n s . W s t a t e d a t p. 7,
                                                        e                      ". . .
t h a t those i n charge of t h e a f f a i r s of c o r p o r a t i o n s a r e l i k e l y
t o be reasonably f a m i l i a r w i t h commercial and a s s o c i a t e d l e g a l
m a t t e r s , and, in any e v e n t , w i l l o f t e n t a k e p r o f e s s i o n a l
advice. I' The same argument can be made i n r e s p e c t of c o r p o r a t e
g u a r a n t e e s under the S t a t u t e of Frauds. On t h e o t h e r hand,
t h e f o r m a l i t i e s under t h e S t a t u t e of Frauds a r e less onerous
and a r e l i k e l y t o be complied with by c o r p o r a t i o n s i n any
event. Also, while it i s conceded t h a t corporations do not
need s p e c i a l c a u t i o n a r y p r o t e c t i o n , the w r i t i n g requirement
under the S t a t u t e of Frauds does serve a v a l u a b l e e v i d e n t i a r y
                  e
function. W i n v i t e comment on the following question.




QUESTION 31

        Should the S t a t u t e of Frauds requirement of writing
        f o r guarantees apply t o c o r p o r a t i o n s ?

          Neither t h e Guarantees Acknowledgement Act nor the S t a t u t e
o f Frauds a p p l i e s t o indemnities. J u d i c i a l attempts to dis-
t i n g u i s h between a guarantee and indemnity has been s a i d t o
g i v e rise t o "hair s p l i t t i n g d i s t i n c t i o n s of e x a c t l y t h a t
kind wfiich brings t h e law i n t o hatred, r i d i c u l e and contempt
by t h e publicn--per Harman, L.J.,                in Yeoman Credit Ltd. v.
L a t t e r [ I 9 6 1 1 2 A l l E.R. 2 9 4 , 299. Nevertheless i n our
Report on the Guarantees Acknowledgement Act we concluded, a t
9-10, " t h a t indemnity c o n t r a c t s should not be brought within
t h e Act, since t h e e f f e c t would be t o i n t r u d e , with unpre-
d i c t a b l e r e s u l t s , upon a v a s t number of commercial t r a n s a c t i o n s
which have never p r e v i o u s l y been a f f e c t e d by t h i s l e g i s l a t i o n . "
This does n o t n e c e s s a r i l y mean t h a t indemnities should not be
required t o comply with t h e less onerous f o r m a l i t i e s of t h e
                                    e
S t a t u t e of Frauds. W s u s p e c t t h a t most indemnities would
s a t i s f y the e v i d e n t i a r y requirements of t h e S t a t u t e of Frauds
anyway. It i s n o t l i k e l y t h a t r e q u i r i n g w r i t t e n evidence of
indemnities would " i n t r u d e upon v a s t numbers of commercial
t r a n s a c t i o n s " i n t h e same way a s would a requirement of
n o t a r i a l evidence.
          I n f a c t , i n d e m n i t i e s , because they a r e o r i g i n a l and n o t
c o l l a t e r a l o b l i g a t i o n s , are more s i g n i f i c a n t t o the o b l i g o r ,
t h a n guarantees.               I n B r i t i s h Columbia, t h e S t a t u t e of Frauds,
R.S. B.C. 1960, c. 369, s. 5 has e l i m i n a t e d the d i s t i n c t i o n
between guarantees and indemnities, with no apparent harmful
effects.

          I f , however, u n i f o r m i t y between t h e S t a t u t e of Frauds and
t h e Guarantees Acknowledgement Act is d e s i r a b l e a s an end i n
i t s e l f , then t h e S t a t u t e of Frau& should n o t be broadened t o
i n c l u d e indemnities.

QUESTION 32

        Should t h e S t a t u t e of Frauds requirement of w r i t i n g
        f o r g u a r a n t e e s be extended t o i n c l u d e indemnities?
                                        CHAPTER X

       SECTION 4:       CONTRACTS NOT TO BE PERFORMED WITHIN
                               RM H
                     ONE YEAR F O T E MAKING THEREOF




        The c o u r t s have been n o t i c e a b l y r e l u c t a n t t o e n f o r c e t h i s
p a r t i c u l a r p r o v i s i o n of t h e S t a t u t e . T h i s has l e d t o t h e
making of some v e r y f i n e d i s t i n c t i o n s .


          I f a c o n t r a c t i s f o r a n i n d e f i n i t e p e r i o d so t h a t t h e
c o n t r a c t may be performed w i t h i n a y e a r it w i l l f a l l o u t s i d e
t h e Statute.--McGregor v. McGregor ( 1 8 8 8 ) , 2 1 Q.B.D.                         424;
Adams v. Union Cinemas Ltd., [I9391 3 A l l E.R. 136 (C.A.)                                  .
However, i f t h e c o n t r a c t p r o v i d e s f o r a s p e c i f i c p e r i o d f o r
performance o f more t h a n one y e a r , b u t a l s o g i v e s t h e p a r t i e s
a power t o t e r m i n a t e which may t a k e p l a c e w i t h i n a y e a r , it
w i l l be w i t h i n t h e Statute.--Hanau v. E h r l i c h , [1911] 2 K.B.
1056, [1912] A.C. 39.


      I n Donellan v. Read ( 1 8 3 2 ) , 3 B. & Ad. 899, 110 E.R.                            330
one p a r t y ' s o b l i g a t i o n was t o be performed w i t h i n a y e a r
        a
and w s so a c t u a l l y performed, and t h e o t h e r p a r t y ' s o b l i g a -
t i o n was s p e c i f i c a l l y t o be performed i n more t h a n one y e a r .
I t was h e l d t h a t t h e S t a t u t e d i d n o t a p p l y . This c a s e should
be c o n t r a s t e d w i t h Reeve v. J e n n i n g s ,    [1910] 2 K.B.         522.
I n Reeve v. Jennings, R employed J f o r a n i n d e f i n i t e p e r i o d ,
J c o v e n a n t i n g n o t t o complete f o r a p e r i o d of t h r e e y e a r s
a f t e r l e a v i n g R ' s employment. J l e f t a f t e r having worked
f o r more t h a n one y e a r and e n t e r e d i n t o c o m p e t i t i o n i n c o n t r a -
v e n t i o n of t h e r e s t r a i n t of t r a d e c l a u s e . I t was held t h a t
t h e S t a t u t e a p p l i e d . Reeve v. J e n n i n g s was d i s t i n g u i s h e d
on t h e ground t h a t h e r e , though t h e one p a r t y ' s o b l i g a t i o n
was f o r a n i n d e f i n i t e p e r i o d , it was i n t e n d e d by t h e p a r t i e s
t h a t it be performed i n more t h a n a y e a r .
        If a c o n t r a c t i s t o be performed o v e r a p e r i o d of one
y e a r commencing t h e d a y a f t e r t h e f o r m a t i o n of t h e c o n t r a c t ,
it f a l l s o u t s i d e t h e Statute.--Smith v. Gold Coast & A s h a n t i
E x p l o r e r s Ltd., [I9031 1 K.B. 285.         The r e a s o n f o r t h i s i s
t h a t t h e law does n o t i n c l u d e , in t h e c o u n t i n g of time, t h e
p a r t i a l day on which t h e c o n t r a c t was made.              If a c o n t r a c t
i s t o be performed o v e r a p e r i o d of one y e a r , commencing two
d a y s a f t e r t h e f o r m a t i o n of t h e c o n t r a c t , it f a l l s w i t h i n t h e
S t a t u t e , n o t w i t h s t a n d i n g t h a t t h e day immediately f o l l o w i n g
t h e f o r m a t i o n of t h e c o n t r a c t i s a Sunday.--Brittain              v.
Rossiter                    1
                           1 Q.B.D.


     Besides t h e S t a t u t e of Frauds, s. 3 ( 2 ) of The M a s t e r s
and S e r v a n t s A c t , R.S.A. 1970, c. 228 p r o v i d e s :


        A c o n t r a c t o r h i r e of p e r s o n a l s e r v i c e f o r a p e r i o d
        of more t h a n one y e a r s h a l l be in w r i t i n g and s i g n e d
        by t h e c o n t r a c t i n g p a r t i e s .

The A c t d o e s n o t s p e c i f y what t h e e f f e c t of non-compliance
w i t h t h i s s e c t i o n is.  I t l i k e l y does n o t preclude a breach
of c o n t r a c t a c t i o n which would be o t h e r w i s e a v a i l a b l e t o a
party.        I n f a c t s. 1 o f t h e A c t p r o v i d e s :
                                1


        T h i s A c t d o e s n o t in any way c u r t a i l , a b r i d g e o r
        d e f e a t any c i v i l o r o t h e r remedy f o r t h e r e c o v e r y
        of wages o r damages
        a)    t h a t t h e employers o r m a s t e r s might have
              a g a i n s t t h e i r employees, s e r v a n t s o r
              labourers, o r

        b)    t h a t t h e employees, s e r v a n t s o r l a b o u r e r s
              might have a g a i n s t t h e i r masters o r employers.

B.      E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform

         The p r o b a b l e r e a s o n f o r t h e i n c l u s i o n of t h i s c a t e g o r y of
c o n t r a c t s i n t h e S t a t u t e was, " n o t t o t r u s t t o t h e memory of
w i t n e s s e s f o r a l o n g e r t i m e than one year."--Smith v. Westhall
(1697), 1 Ld. Raym. 316.                     However, t h i s r a t i o n a l e has been
e x t e n s i v e l y c r i t i c i z e d . The English Law Revision Committee,
a t 9-10, s u b j e c t e d t h i s c a t e g o r y t o a more thorough a n a l y s i s
than the other categories.                     I t s f i n d i n g s were as f o l l o w s :


       The S t a t u t e assumes t h e span of r e l i a b l e human
       memory t o extend t o one y e a r and no f u r t h e r .
       When t h e c o n t r a c t and i t s performance are more
       widely s e p a r a t e d a n o t e o r memorandum i s c a l l e d
       for.
       This seems i l l o g i c a l . There would be n o t h i n g
       ridiculous i n a provision t h a t a l l transactions,
       between which and t h e i r proof i n a Court of Law
       t h e r e i n t e r v e n e s a p e r i o d of more t h a n X y e a r s ,
       must be proved by some e x c e p t i o n a l l y cogent type
       of evidence: X y e a r s being a r e a s o n a b l e e s t i m a t e
       of t h e maximum normal l i m i t of c l e a r r e c o l l e c t i o n .
       But t h i s i s n o t what S e c t i o n 4 provides.
       (1) The p e r i o d it t r e a t s a s m a t e r i a l i s t h e
       p e r i o d i n t e r v e n i n g , n o t between f a c t and proof
       of t h a t f a c t , b u t between t h e making of t h e
       c o n t r a c t and t h e t i m e which i s t o e l a p s e b e f o r e
       it i s f u l l y performed.
        (2)    This p e r i o d i s f i x e d a t one year.
       The i l l o g i c a l c h a r a c t e r of t h e s e p r o v i s i o n s i s
       perhaps b e s t demonstrated by simple examples of
       t h e i r working :   --
        ( a ) A c o n t r a c t n o t be t o performed w i t h i n a
       y e a r from i t s making i s made o r a l l y .      It is
       r e p u d i a t e d t h e day a f t e r it is made, v i z . : at
       a time when i t s t e r m s a r e f r e s h i n the minds of
       everyone. Y e t f o r want of w r i t i n g no a c t i o n can
       be brought t o e n f o r c e it.

        ( b ) A c o n t r a c t n o t t o be performed w i t h i n a
       y e a r from i t s making i s made o r a l l y , and i s
       r e p u d i a t e d t h e day a f t e r it is made. Five y e a r s
       a f t e r t h e breach t h e g u i l t y p a r t y writes and
       s i g n s ( f o r h i s own u s e ) a summary of i t s t e r m s ,
       which comes t o t h e knowledge of t h e o t h e r p a r t y .
       The l a t t e r can t h e n e n f o r c e t h e c o n t r a c t , f o r t h e
       w r i t i n g need n o t be contemporary t h e r e w i t h .           It
       i s s u f f i c i e n t ( s u b j e c t t o t h e S t a t u t e of
       L i m i t a t i o n s ) i f t h e w r i t i n g comes i n t o e x i s t e n c e
       a t any time b e f o r e a c t i o n brought; by which t i m e
       r e c o l l e c t i o n ( i f one y e a r i s i t s maximum normal
       span) may have c o m p l e t e l y faded.
       (c) A c o n t r a c t made o r a l l y i s t o be performed
       w i t h i n less t h a n a y e a r of i t s making, and i s
       broken.         The i n n o c e n t p a r t y can s u e n e a r l y s i x
       y e a r s a f t e r t h e breach; by which time t h e p a r t i e s
       must (on t h e a s s u m p t i o n s of S e c t i o n 4 ) have f o r -
       g o t t e n i t s terms.        (The assumptions of S e c t i o n 4
       a r e indeed u t t e r l y i n c o n s i s t e n t w i t h t h o s e on
       which t h e S t a t u t e of L i m i t a t i o n s proceeds. )

         The New York Law Reform Commission i n i t s paper "Oral
C o n t r a c t s n o t t o be Performed Within One Year," Leg. Doc.
 (1957) #65 (A) , p o i n t e d o u t t h a t t h e purpose of t h e i n c l u s i o n
o f t h i s t y p e of c o n t r a c t i s p u r e l y e v i d e n t i a r y . Y e t it i s
q u i t e i r o n i c t h a t i n o r d e r t o prove t h a t t h e S t a t u t e a p p l i e s
t h e d e f e n d a n t must n o t o n l y prove t h e e x i s t e n c e of t h e con-
t r a c t , b u t a l s o t h a t it was f o r a p e r i o d of more t h a n one y e a r .
I n successfully e s t a b l i s h i n g t h e defence, t h e defendant a l s o
proves t h e contract.    I n t h e words of Du P a r c q , L . J .                      i n Adams
v. Union Cinemas L t d . , [1939] 3 A l l E.R. 136, 138:


       I must c o n f e s s t h a t I should be v e r y s o r r y t o
       have t o e x p l a i n t h e f a c t s of t h i s c a s e and t h e
       importance of t h e l e g a l i s s u e s i n t h i s c a s e t o
       an i n t e l l i g e n t f o r e i g n e r , because I c a n imagine
       h i s asking:           "Why i s it t h a t c o u n s e l f o r t h e
       d e f e n d a n t s was a p p a r e n t l y much more a n x i o u s even
       t h a n c o u n s e l f o r t h e p l a i n t i f f t o show t h a t h i s
       c l i e n t had e n t e r e d i n t o an agreement t o employ
       t h e p l a i n t i f f f o r a l o n g e r t i m e and a t a l a r g e r
       s a l a r y ? Is it because of undue g e n e r o s i t y on
       t h e i r p a r t , o r how i s it t o be e x p l a i n e d ? " I
       can imagine t h a t , when one had t o t e l l him t h a t
       t h e r e a s o n was t h a t , i f o n l y t h e d e f e n d a n t s
       could s a t i s f y t h e c o u r t t h a t t h e y had g i v e n their
       word t o t h e p l a i n t i f f t h a t t h e y would employ him
       f o r two y e a r s , t h e n t h e c o u r t would a t once
       d e c i d e t h a t , i n t h e c i r c u m s t a n c e s , t h e y need n o t
       pay him a penny and t h e y w e r e n o t bound t o employ
       him, t h e i n t e l l i g e n t f o r e i g n e r would f i n d a
       l i t t l e d i f f i c u l t y i n understanding t h e explanation.
                                                                                         127
       T h i s c a t e g o r y h a s been r e p e a l e d i n B r i t i s h Columbia,
G r e a t B r i t a i n , New Zealand and Western A u s t r a l i a .         I t is
recommended t h a t A l b e r t a f o l l o w t h e l e a d of t h e s e j u r i s d i c -
tions.

QUESTION 33


       Should c o n t r a c t s n o t t o be performed w i t h i n a y e a r
       be r e q u i r e d t o be e v i d e n c e d in w r i t i n g ?
                                        CHAPTER X I

           SECTION 4: CONTRACTS TO CHARGE AN EXECUTOR OR
                             PN
              ADMINISTRATOR U O ANY SPECIAL PROMISE TO
                  NW R A A E    U   F
                 A S E D M G S O T O HIS OWN ESTATE

     T h i s p r o v i s i o n a p p l i e s t o both l i q u i d a t e d and u n l i q u i d a t e d
damages,--Williams,            S t a t u t e o f Frauds S e c t i o n I V , 4--but does
n o t a p p l y t o a promise made b e f o r e t h e promisor has become t h e
                                              -
a d m i n i s t r a t o r . --Tomlinson v. G i l l (1756 ) , Arnb. 330.                     Despite
t h e M e r c a n t i l e Law Amendment A c t (1856) 19 & 20 V i c t . , c . 97,
s. 3 , which p r o v i d e s t h a t t h e c o n s i d e r a t i o n need n o t appear
i n w r i t i n g f o r a promise " t o answer f o r t h e d e b t , d e f a u l t , o r
m i s c a r r i a g e of a n o t h e r p e r s o n , " t h e c o n s i d e r a t i o n f o r a
promise s u c h as t h i s must s t i l l a p p e a r in w r i t i n g . - - C h i t t y on
C o n t r a c t s 726 ( 2 0 t h ed., 1947)      .
        A t t h e t i m e of t h e enactment of t h e S t a t u t e of Frauds,
t h e e x e c u t o r o r a d m i n i s t r a t o r of an e s t a t e took b e n e f i c i a l l y
i f t h e r e was no r e s i d u a r y g i f t , and t h e e s t a t e w s n o t l i a b l e
                                                                           a
f o r t h e wrongful a c t s of t h e d e c e a s e d . T h i s p l a c e d moral
p r e s s u r e on t h e e x e c u t o r o r a d m i n i s t r a t o r t o make r e s t i t u t i o n
o u t of h i s own f u n d s , so t h a t such s p e c i a l promises were
common. A t p r e s e n t , o f c o u r s e promises o f t h i s n a t u r e a r e v e r y
r a r e . Repeal would seem t o make l i t t l e p r a c t i c a l d i f f e r e n c e
and would simply remove a n anachronism from t h e S t a t u t e books.
The e q u i v a l e n t p r o v i s i o n was r e p e a l e d i n B r i t i s h Columbia by the
S t a t u t e of Frauds, S.B.C. 1958, c. 18, s. 7; in G r e a t B r i t a i n by
t h e Law Reform (Enforcement of C o n t r a c t s ) A c t , (1954) 2 & 3
E l i z . 11, c. 34, s. 1; i n N e w Zealand by t h e C o n t r a c t s Enforce-
ment Act, 1956 No. 23, s. 2; and i n Western A u s t r a l i a by the
Law Reform ( S t a t u t e of F r a u d s ) Act, 1962, No. 1 6 , s.                   2.
S i m i l a r a c t i o n i s recommended f o r A l b e r t a .
QUESTION 34

     Should c o n t r a c t s t o charge an executor o r adminis-
     t r a t o r upon any s p e c i a l promises t o answer damages
     o u t of h i s own e s t a t e be r e q u i r e d t o be evidenced
     i n writing?
                                           CHAPTER X I 1

      SECTION 4:                      O
                           CONTRACTS T CHARGE ANY PERSON UPON ANY
                                              F
           AGREEMENT MADE UPON CONSIDERATION O MARRIAGE


        The wording of t h i s p h r a s e would seem t o i n c l u d e mutual
p r o m i s e s t o marry, and o r i g i n a l l y it was so construed.--
P h i l p o t v. W a l l e t ( 1 6 8 2 ) , 3 Lev.        65.     However,        l a t e r judicial
i n t e r p r e t a t i o n s e x c l u d e d t h i s meaning from t h e S t a t u t e - -
                     -
H a r r i s o n v. Cage ( 1 6 9 8 ) , C a r t h .               -
                                                       467; Cork v.           Baker      (1717), 1
S t r a n g e 34--so     t h a t now it c o v e r s , f o r example, promises t o
s e t t l e p r o p e r t y upon a p e r s o n i n c o n s i d e r a t i o n of m a r r i a g e .

        T h i s class of c o n t r a c t w a s p r o b a b l y i n c l u d e d i n t h e S
S t a t u t e because of t h e i m p o r t a n c e accorded t o it a t t h a t t i m e ,
and t h e r e q u i r e m e n t of w r i t i n g s e r v e d b o t h an e v i d e n t i a r y and
a cautionary function.                   However, " a s a r e s u l t of j u d i c a l l e g i s -
l a t i o n on t h i s c l a u s e o f t h e S t a t u t e there i s v e r y l i t t l e l e f t
of it, and what l i t t l e i s l e f t i s a c c o m p l i s h i n g l i t t l e goodff--
Willis,      "The S t a t u t e o f Frauds--A              Legal Anachronism"                (1928) 3
I n d i a n a L.J.    426, 436.          I t would t h e r e f o r e seem t h a t r e p e a l of
t h i s p r o v i s i o n would make l i t t l e p r a c t i c a l d i f f e r e n c e .          I t has
been r e p e a l e d i n t h e same j u r i s d i c t i o n s and by t h e same A c t s a s
t h e p r o v i s i o n r e l a t i n g t o e x e c u t o r s and a d m i n i s t r a t o r s .


QUESTION 35


        Should c o n t r a c t s made upon c o n s i d e r a t i o n of m a r r i a g e
        be r e q u i r e d t o be evidenced in w r i t i n g ?
                                       CHAPTER X I 1 1

                      SECTION 6:          LORD TENTERDEN 'S ACT:
                                  S
              MISREPRESENTATIONS A TO CREDIT WORTHINESS

       S e c t i o n 6 o f Lord       enterd den's Act ( 1 8 2 8 ) , 9 Geo. IV,
c . 1 4 , provides:

        VI.      And be it f u r t h e r e n a c t e d , That no Action
        s h a l l be b r o u g h t where t o charge any Person upon
        o r by r e a s o n o f any R e p r e s e n t a t i o n o r Assurance
        made o r g i v e n c o n c e r n i n g o r r e l a t i n g t o t h e
        C h a r a c t e r , Conduct, C r e d i t , A b i l i t y , Trade, o r
        Dealings of any o t h e r Person, t o t h e i n t e n t o r
        Purpose a s such o t h e r Person may o b t a i n C r e d i t ,
        Money, o r Goods upon d e a t h u n l e s s such Representa-
        t i o n o r Assurance be made i n W r i t i n g , signed by
        t h e P a r t y t o be charged t h e r e w i t h .

        The Requirement o f W r i t i n g


         While t h e p h r a s e "no a c t i o n s h a l l be brough" means unen-
f o r c e a b l e t h e s e c t i o n r e q u i r e s t h e r e p r e s e n t a t i o n t o be made
i n writing.         Thus a subsequent w r i t i n g e v i d e n c i n g an o r a l
r e p r e s e n t a t i o n w i l l b e i n s u f f i c i e n t . The p h r a s e "signed by
t h e p a r t y t o be charged t h e r e w i t h " has been i n t e r p r e t e d a s
e x c l u d i n g t h e s i g n a t u r e of an a g e n t . --Swift v. Jewsbury (1874) ,
L.R.      9 Q.B. 301; H i r s t v. West Riding Union                      an king Company
L i m i t e d , [1901] 2 K.B. 560 ( C . A . ) .




       The p h r a s e " t o c h a r g e any person upon o r by r e a s o n of
                                                                             a
any r e p r e s e n t a t i o n of a s s u r a n c e made o r g i v e n " w s i n t e r p r e t e d
by t h e House of Lords i n Wrenbury v. Bank of Montreal, [I9181
A.C.   626 a s r e f e r r i n g o n l y t o a c t i o n s f o r f r a u d u l e n t m i s r e p r e -
sentation.         Lord Ranbury reasoned t h a t even i f t h e r e was a
duty with regard t o innocent misrepresentation, the a c t i o n
would l i e upon t h e b r e a c h of duty. Innocent misrepresentation
would n o t be t h e c a u s e of a c t i o n , b u t r a t h e r e v i d e n c e of
negligence.    O t h e a u t h o r i t y of C a i r n s J. i n W. B. Anderson
                 n                                                                                       &
Sons Ltd. v. Rhddes ( L i v e r p o o l ) L t d . ,               [I9671 2 A l l E.R.         850
( L i v e r p o o l A s s i z e s ) , t h i s p o s i t i o n h a s n o t been changed by t h e
d e c i s i o n i n Hedley Byrne             &   Co. Ltd. v. Heller             &   Partners ~ t d . ,
 119641 A.C. 465.    The l a w i n t h i s a r e a i s t h e r e f o r e anomalous
i n t h e extreme. I f one makes a v e r b a l m i s r e p r e s e n t a t i o n
n e g l i g e n t l y , he w i l l be h e l d l i a b l e ; i f he makes it fraudu-
l e n t l y , he w i l l n o t be h e l d l i a b l e .


        To f a l l w i t h i n t h e ambit of t h i s s e c t i o n a r e p r e s e n t a t i o n
must r e l a t e t o " t h e c h a r a c t e r , conduct, c r e d i t , a b i l i t y , t r a d e
o r d e a l i n g s of any o t h e r person."                I n e s s e n c e t h i s means a
r e p r e s e n t a t i o n a s t o t h e c r e d i t w o r t h i n e s s of a t h i r d p a r t y .
Swann v. P h i l l i p s ( 1 8 3 8 ) , 8 A. & E. 457 i l l u s t r a t e s t h e
a p p l i c a t i o n of t h i s p r o v i s i o n .   The d e f e n d a n t t o l d t h e p l a i n -
t i f f t h a t he h e l d a t h i r d p a r t y ' s t i t l e deeds, and on t h e
s t r e n g t h of t h i s t h e p l a i n t i f f l e n t t h e t h i r d p a r t y money.
The c o u r t of K i n g ' s Bench h e l d t h e S t a t u t e a p p l i e d a s t h i s
was i n e f f e c t a r e p r e s e n t a t i o n a s t o t h e t h i r d p a r t y ' s
creditworthiness.


        The word " p e r s o n ,       I'   used t h r e e t i m e s in t h e s e c t i o n , has
been i n t e r p r e t e d a s i n c l u d i n g c o r p o r a t i o n s .   -- Wrenbury         -
                                                                                            v. Bank
of Montreal. F i n a l l y , i f t h e r e a r e both o r a l and w r i t t e n
representations, then " i f the f a l s e representation i n writing
s u b s t a n t i a l l y c o n t r i b u t e d t o t h e i n j u r y of which t h e p l a i n t i f f
complains, t h e d e f e n d a n t i s c l e a r l y responsible."- atto ton V.
Wade ( 1 8 5 6 ) , 18 C.B.           371, 385.


C.      E v a l u a t i o n of t h e Law and P r o p o s a l s f o r Reform

        The a p p a r e n t r a t i o n a l e f o r t h e enactment of t h e s e c t i o n
was t h e f e a r t h a t w i t h o u t such a r e q u i r e m e n t , p l a i n t i f f s
who c o u l d n o t s u e on g u a r a n t e e s because of a l a c k of w r i t i n g ,
could circumvent s e c t i o n 4 of t h e S t a t u t e of Frauds by
b r i n g i n g an a c t i o n i n t h e t o r t of d e c e i t .--see Banbury v.
                             -
Bank of Montreal, p e r Lord Wrenbury, a t 711-712.

        L i t t l e can be s a i d i n favour of r e t a i n i n g t h i s p r o v i s i o n .
For one t h i n g , a s t h e B r i t i s h Columbia Law Reform Commission
p o i n t s o u t i n i t s working paper a t 1 2 0 :

        ...      t h e m i s c h i e f t o which t h e s e c t i o n was directed
        no longer e x i s t s , and we b e l i e v e t h e c o u r t s of t h i s
        province a r e p e r f e c t l y q u a l i f i e d t o d i s t i n g u i s h
        between o r a l g u a r a n t e e s and o r a l r e p r e s e n t a t i o n s a s
        t o c r e d i t ; and a r e n o t prone t o use t h e l a t t e r a s a
        means of a v o i d i n g t h e d i f f i c u l t i e s r e s u l t i n g from
        t h e u n e n f o r c e a b i l i t y of t h e former.

         Secondly, it i s an unacceptable anomaly t h a t o r a l n e g l i g e n t
m i s r e p r e s e n t a t i o n s a r e a c t i o n a b l e b u t o r a l f r a u d u l e n t misrepre-
s e n t a t i o n s a r e n o t . A p a r t y should n o t be a b l e t o p l a c e himself
i n a better p o s i t i o n by proving h i s own f r a u d .

        W e i n v i t e comment on t h e f o l l o w i n g q u e s t i o n .


QUESTION 36

        Should f r a u d u l e n t m i s r e p r e s e n t a t i o n s a s t o credit-
        w o r t h i n e s s be r e q u i r e d t o be in w r i t i n g ?
                                       CHAPTER X I V
                    SECTION 5: LORD TENTERDEN ' S ACT:
                                 F
                   RATIFICATION O INFANTS' CONTRACTS


      B a s i c a l l y t h e r e are f o u r c a t e g o r i e s of i n f a n t s ' c o n t r a c t s :

      1.      C o n t r a c t s f o r n e c e s s a r i e s and non-pre j u d i c i a l
              c o n t r a c t s of s e r v i c e .      I n s u c h c o n t r a c t s the
              i n f a n t w i l l i n c u r l i a b i l i t y , a l t h o u g h whether
              such l i a b i l i t y is c o n t r a c t u a l o r quasi-contractual
              i s open t o debate.--see P e r c y , "The P r e s e n t Law of
              I n f a n t s ' C o n t r a c t s " ( 1 9 7 5 ) , 5 3 C.B.R. 1, 6-12.


      2.      Void c o n t r a c t s . T h i s c a t e g o r y c o n s i s t s of
              "prejudicial" contracts.

      3.      C o n t r a c t s which are b i n d i n g on t h e i n f a n t u n t i l
              he r e p u d i a t e s .   These a r e c o n t r a c t s r e l a t i n g t o
              l a n d , s h a r e c o n t r a c t s , p a r t n e r s h i p agreements
              and m a r r i a g e s e t t l e m e n t s .

      4.      C o n t r a c t s which are n o t b i n d i n g on t h e i n f a n t
              u n l e s s he r a t i f i e s upon a t t a i n i n g h i s m a j o r i t y .
              This category includes a l l c o n t r a c t s not f a l l i n g
              w i t h i n t h e above t h r e e c a t e g o r i e s .

      I t i s t o t h i s l a s t c a t e g o r y t h a t s e c t i o n 5 of Lord
enterd den's A c t a p p l i e s .        The s e c t i o n p r o v i d e s :


      And be it f u r t h e r e n a c t e d , T h a t no A c t i o n s h a l l
      be m a i n t a i n e d whereby t o c h a r g e any P e r s o n upon
      any Promise made a f t e r f u l l Age t o pay any Debt
      c o n t r a c t e d d u r i n g I n f a n c y , o r upon any R a t i f i c a -
      t i o n a f t e r f u l l Age of any Promise o r Simple
      C o n t r a c t made d u r i n g I n f a n c y , u n l e s s s u c h
      Promise o r R a t i f i c a t i o n s h a l l be made by some
      W r i t i n g s i g n e d by t h e P a r t y t o be charged
      therewith.
         The e f f e c t of non-compliance               is t o render the r a t i f i c a -
t i o n not void, but unenforceable.                      The e f f e c t of t h i s would
s e e m t o be t h a t ,      ". . . t h e    r e q u i r e m e n t of r a t i f i c a t i o n i s
d i s c h a r g e d by e x e c u t i o n by t h e i n f a n t and i t s u n e n f o r c e a b i l i t y
becomes i r r e l e v a n t . "--Percy,         31.


         S e c t i o n 5 of Lord T e n t e r d e n ' s A c t was r e p e a l e d in England
by t h e I n f a n t s '    R e l i e f Act of 1874.          However, s i n c e the d a t e of
r e c e p t i o n of E n g l i s h l a w i n t o A l b e r t a , Manitoba and Saskatchewan
i s J u l y 15, 1870 s e c t i o n 5 should s t i l l be i n f o r c e i n A l b e r t a .
I n Molnyneux v. T r a i l 1 ( 1 9 1 5 ) , 32 W.L.R. 292 (Sask. D.C.)           it
was e x p r e s s l y h e l d t h a t Lord T e n t e r d e n ' s Act i s a p p l i c a b l e in
Saskatchewan, and i n Brand v. G r i f f i n ( 1 9 0 8 ) , 1 A l t a . L.R.                           510
(S.C.)       a
        it w s h e l d t h a t t h e I n f a n t s ' R e l i e f A c t does n o t apply
i n Alberta.


         However,       some Canadian cases have t r e a t e d c o n t r a c t s
requiring r a t i f i c a t i o n          c o n t r a c t s which are b i n d i n g u n l e s s
r e p u d i a t e d w i t h i n a r e a s o n a b l e p e r i o d of t i m e of a t t a i n i n g
m a j o r i t y , t h u s c o n v e n i e n t l y d i s p e n s i n g w i t h t h e need f o r   any
r a t i f i c a t i o n . --see,   f o r example, Blackwell v. Farrow,                      [I9481
O.S.N.      7 and in R e Hutton E s t a t e ,            [1926] 4 D.L.R.            1080, w h i l e
t h e a p p l i c a b i l i t y of Lord T e n t e r d e n ' s A c t w a s n o t e x p r e s s l y
c o n s i d e r e d , I v e s J., d i d s t a t e , a t 1083, t h a t        ". . . t h e
r a t i f i c a t i o n d o e s n o t have t o be i n w r i t i n g . "        There is a l s o
o l d E n g l i s h a u t h o r i t y f o r t h e p r o p o s i t i o n t h a t s e c t i o n 5 may
n o t apply where t h e i n f a n t h a s t a k e n b e n e f i t under t h e
c o n t r a c t f o r some l e n g t h of t i m e . --Cornwall            v. Hawkins (1872) ,
L.J.     4 1 Eq.     435.


         T h i s p a r t i c u l a r r e q u i r e m e n t of w r i t i n g c a n best be
characterized a s archaic.                   Any changes s h o u l d be i n t e g r a t e d
w i t h a reform of t h e g e n e r a l law of i n f a n t s '             contracts.            In
o u r Report on Minors' C o n t r a c t s we recommended inter a l i a ,
a t 34-3 6, t h a t u n e n f o r c e a b l e i n f a n t s ' c o n t r a c t s should be
c a p a b l e of a f f i r m a t i o n by an i n f a n t upon a t t a i n i n g h i s
majority.           I n o u r d r a f t Minors' C o n t r a c t s A c t we d i d n o t
r e s t r i c t t h e manner i n which a f f i r m a t i o n may t a k e p l a c e .

Q U E S T I O N 37


        Should r a t i f i c a t i o n s of i n f a n t s ' c o n t r a c t s be
        r e q u i r e d t o be in w r i t i n g ?
                       STATUTES REFERRED TO


England

S t a t u t e o f F r a u d s , 1 6 7 7 , 29 Can. 2 , c . 3.
S t a t u t e o f F r a u d s Amendment A c t , 1828 ( L o r d T e n t e r d e n ' s
A c t ) , 9 Geo. 4 , c . 1 4 .
M e r c a n t i l e Law Amendment A c t , 1 8 5 6 , 1 9 & 2 0 , V i c t . , c. 9 7 .
S a l e o f Goods A c t , 1 8 9 3 , 56 & 57 V i c t . , c . 7 1 .
Law o f P r o p e r t y A c t , 1 9 2 5 , 1 5 & 1 6 , Geo. 5 , C . 20.
Law Reform ( E n f o r c e m e n t o f C o n t r a c t s ) A c t , 1 9 5 4 , 2 & 3 ,
E l i z . 2 , c . 34.

Australia

Queensland

a)   S t a t u t e of F r a u d s and L i m i t a t i o n s A c t , 1867,
     31 V i c . No. 2 2 .
b)   S a l e o f Goods A c t , 1 8 9 6 , 60 V i c . No. 6 .

New S o u t h Wales

a)    C o n v e y a n c i n g A c t , 1 9 1 9 , No. 6 .
b)    I m p e r i a l A c t s A p p l i c a t i o n A c t , 1 9 6 9 , No. 30.

South A u s t r a l i a

a)    M e r c a n t i l e Law A c t , 1 9 3 6 , No. 2285.
b)    Law o f P r o p e r t y A c t , 1 9 3 6 , No. 2328.
c)    S a l e o f Goods A c t , 1 8 9 5 , No. 630.

Canada

1.    Alberta

      a)    S a l e o f Goods A c t , R.S.A.           1 9 7 0 , c . 327.

2.    B r i t i s h Columbia

      a)    S t a t u t e o f F r a u d s , R.S.B.C.      1 9 6 0 , c . 369.
                  REPORTS -REFERRED TO
A.   England
     1. Law Revision Committee (Statute of Frauds and the
        Doctrine of Consideration) 6th Report 1937.
     2. Law Reform Committee (Statute of Frauds and s. 4 of the
        Sale of Goods Act, 1893) 1st Report 1953.

B.   Australia
     1. Queensland - The Law Reform Commission of Queensland--
        A Review of the Statute of Frauds & Ct. Q.L.R.C. 6,
        1970.
     2.   South Australia--Law Reform Committee of South
          Australia, 34th Report--Statute of Frauds and
          Cognate Enactments. 1975
C.   Canada
     1.   British Columbia--Law Reform Commission of British
          Columbia, Report on the Statute of Frauds, 1977.
                                           APPENDIX A            -   MIENDMENTS T O T H E S T A T U T E O F FRAUDS AND S U G G E S T I O N S O F LAW REFORM B O D I E S


S.             SUIIJECT MATTER                                                            BRITISH COLUMBIA                                                 N.   SOUTH WALES    S . AUSTRALIA                 STATUS I N


1.   Lenses and i n t e r e s t s i n l a n d             H tuined
                                                           e           1925               Retained         B.C.          Retained                          lr'etained         Retained                       In force
     t o have f o r c e of e s t a t e s a t              Law o f P r o p e r t y A c t   S t a t u t e of Frauds        1 8 6 7 A c t s. 2                Conveyancing Act   1936 Act
     w i l l , unless in writing.                     1       s.54                        1958 s. 2(2)                                                        s. 23C            s. 30
                                                                                                                                                              s. 23D          Law o f P r o p e r t y
                                                                                          Recommend a l t e r a -        Recommend rsetentton
                                                                                                                                                                                 Act
                                                                                          t i o n 1977 Report            R e p o r t C1. 7 .


2.   Excepting l e a s e s not excee-                     AlZered      1925               Altered          B.C.          Retained                          Altered            Altered                        In force
     d i n g t h r e e y e a r s where                    Law o f P r o p e r t y Act     S t a t u t e of Frauds        1867 Act s. 3                     Conveyancing Act   1936 Act
     amollnts r e s e r v e d t o l a n d l o r d s           s . 54                      1958 s.2(3)                                                         s . 23D           s. 30
     is 2 1 7 o r more o f v a l u e o f                                                                                                                                      Law o f P r o p e r t y
     t h i n g demised.
                                                                                          Recommend reten-               Recommend a1 tera-
                                                                                                                                                                                Act
                                                                                          tion                           ti on
                                                                                          1977 Report                    R e p o r t C1. 5 ( 2 ) ( b ) ,
                                                                                                                         and 7 ( 2 )
                                                                                                                                                                                                                                          %
                                                                                                                                                                                                                                          'd
                                                                                                                                                                                                                                          M
                                                                                                                                                                                                                                          z
3.   Assignment, g r a n t o r s u r -
     r e n d e r of i n t e r e s t i n l a n d
                                                          Retained      1925              Retained         B.C.          Retained                          Retained           Retained
                                                                                                                                                                              1936 Act
                                                                                                                                                                                                             In force                     u
                                                          Law o f P r o p e r t y Act     S t a t u t e oE F r a u d s   1867 A c t s. 4                   Conveyancing Act                                                               H
     t o be i n w r i t i n g                                s. 5 2                       1958 s. 2(2)                                                        s . 23B         s. 2 B ( 1 )                                                3C
                                                                                          R e c o m n d altera-          Recommend r e t e n t i o n
                                                                                          tion                           P e p o r t C1. 1 6 5
                                                                                          1977 Report


4.   a ) C o n t r a c t s by e x e c u t o r             Recommend repeal                Repealed                       H tained
                                                                                                                          e                                                    In force                      171   force
     o r administrator t o                                1937 Report                     B.C. S t a t u t e o f         1867 Act s. 5
     answer damages o u t of h i s                                                        F r a u d s , 1958                                                                   Recommend repeal
                                                          Repealed                                                       Recommend repea 1
     own e s t a t e                                                                                                                                                           1975 Report
                                                          1 9 5 4 Act s . I                                              R e p o r t C1. 1

                                                          Altered    Mercantile
     b) Promise o r guarantee t o                         Law A c t 1 8 5 6 s . 3         Extended         B.C.          Retained                                              Re tnined                     Altered
     answer f o r t h e d e b t , de-                     Recommend repea 7.              S t a t u t e of Frauds,       1 8 6 7 A c t s. 5                                    M e r c a n t i l e Law Act   t i e r c a n t i l e I,aw
     f a u l t o r m i s c a r r i a g e of               1937 Report m a j o r i t y     1 9 5 8 s. 5                                                                         1936 s. 1 6                   A c t 1856
                                                                                                                Recommend r e t e n t i o n
     another                                              Recommend r e t e n t i o n                                                                                                                         (Imp. ) s . 3
                                                          1937 Report minority
                                                                                          Re commend re ten ti@??e p o r t C l . 4
                                                                                                                R                                                              Reconmend repeal
                                                                                          1977 Report                                                                          1975 Report
                                                          1953 Report
                                                          Not 1vyen7ed
                                                          1954 Act
                                                                                                                                                                                                          P
                                                                                                                                                                                                          IP
                                                                                                                                                                                                          0

                                                                                                                                                                                                page 2

 S.               SUBJECT MATTER                     ENGLAND              BRITISH COLUMBIA                  QUEENSLAND            N.    SOUTH WAI.ES                S . AUSTRALIA                 STATUS IN
                                                                                                                                                                                                   ALRER'PA

      c)    Consideration of Marriage          'lecomend repca 1         Hepea led          .
                                                                                         B C.           Retained                  Repealed                        I n force                      In force
                                               1937 R e p o r t          S t a t u t e of F r a u d s   1 8 6 7 Act S . 5         Imperial Acts                   Recomnend repeal
                                                                             1958                                                 A p p l i c a t i o n s Act     1975 Report
                                                                                                        Recononend repeal
                                               ?epealed                                                 Report Cl. 3
                                                                                                                                         1969
                                               1954 Act s. I
                                                                                                                                                                                                               -
      d)   Agreements n o t t o b e            ?ecornend repeal          Repealed        B . C.         Retained                  Repealed                        In force                       In force
           performed w i t h i n 1 y e a r     1937 R e p o r t          S t a t u t e of F r a u d s   1867 Act s . 5            Imperial Acts
                                                                             1958                                                 A p p l i c a t i o r l s Act   Recommend repeal
                                               ?epealed                                                 Recornend repeal             1969                         1975 Report
                                               1954 A c t .   6.   1
                                                                                                        R e p o r t C1. 3

      e)   Contracts f o r the s a l e         Zetained       1925       Retained        B. C.          Retained                  Retained                        Retained                       In force
           of l a n d                                                    S t a t u t e of Frauds        1867 Act s. 5             C o n v e y a n c i n g Act     1936 Act
                                               a w of Property
                                                                             1958                                                 1919 - 1967                      s. 26(1)
                                               k t , s. 40
                                                                                                                                  s . 5 4 A(1)
                                                                         Recornend                      'ecomnd                                                   Recomnd
                                                                           a Iteration                   retention                                                 re t e n t i o n
                                                                         1977 Report                    . e p o r t C1. 3                                         1975 Report

7.    Creatiorls and d e c l a r a t i o n s   Fo'tained     192 5       Retained        B.C.           In Force                  Re tuined                       Retained                      rtl   force
      of t r u s t s of land                   .aw o f P r o p e r t y   S t a t u t e of Frauds        Recononet~d               C o n v e y a n c i n g Act     1936 Act
                                               k t , s. 53               1 9 5 8 s. 2 ( 2 )              retention                1919-1967                       ss. 2 9 ( l ) ( b ) & ( c )
                                                                                                        R e p o r t C1. 6 ( 1 )   s. 23 C ( l )                   31-33 Law o f
                                                                         8ecomnend repeal                 (b)                                                     P r o p e r t y Act
                                                                         1977 R e p o r t                                                                         t?ecomnend
                                                                                                                                                                   alteration
                                                                                                                                                                  1975 Report

8.     Exception of implied o r                etained       1925        Retained         B .C  .       In force                  Retained                        Retained
       constructive trust                      aw o f P r o p e r t y    S t a t u t e of Frauds                                  k n v e y a n c i n g Act        1 9 3 6 Law o f
                                               c t s. 53                 1958 s. 4                      Recornend                 1919-1967                        P r o p e r t y Act
                                                                                                         retell t i o n           s . 23c(3)                       s. 29(2)
                                                                         Recorrmend repeal              R e p o r t C1. 6 ( 2 )
                                                                         1977 R e p o r t                                                                         Recornmend
                                                                                                                                                                    ~etention
                                                                                                                                                                  1975 Report
             SUBJECT MATTER                                    ENGLAND              BRITISH COLUMBIA              QUEENSLAND                      N. SOUTH WALES                S . AUSTRALIA              STATUS IN
                                                                                                                                                                                                            ALBERTA
                                                                                                                 -

9.     Assignment o f i n t e r e s t i n a             Fetained         1925 Law    tained
                                                                                    <e         B .C    .         In force                        R tc~ined
                                                                                                                                                  e                            Retained                   In fcrce
       trust                                            ~f P r o p e r t y Act      gtatute of Frauds                                            C o n v e y a n c i n g Act   1 9 3 6 Act
                                                        3 . 53                      958 x . 4                    necomend                        191.9 - 1967                  s. 2 9 ( l ) ( c )
                                                                                    iecommend repeal               a1 teration                   s. 23(c)(l)                   Law o f P r o p e r t y
                                                                                    1977 R e p o r t                                                                              Act
                                                                                                                 R e p o r t C1. 6 ( l ) ( c )


17.    Memorandum r e q u i r e d o n                   4mended      1 8 2 8 Act    iapeaZed                     Retained        S a l e of                                    Retained         Sale of   AZtered      S a l e rf
(16)   c o n t r a c t o f s a l e o f g o o d s over   5.7                                                      Goods Act                                                     Goods Act                  Goods Act
                                                                                    ; t a t u t e Law Amend-                                                                   1 8 9 5 , s. 4             RSA 1 9 7 0
       L10.                                             Petuined S a l e o f                                     ss. 28 6 7
                                                                                    nent A c t , 1 9 5 8                                                                                                  c . 3 2 7 , s. 7
                                                        Soods Act 1 8 9 3 c . 7 1                                Recommend repeal                                              Recommend repeal
                                                                                    ;.B.c. 1 9 5 8 , c . 5 8 ,
                                                        s. 4                                                     Report C l . 3
                                                                                    s. 1 7                                                                                     1975 Report
                                                         e
                                                        R cononend rsepea 1
                                                        1937 R e p o r t
                                                        1953 Report
                                                        Fepea Zed
                                                        1954 Act
                                   STATUTE OF FRAUDS

                                   29 C a r . 11. c. 3
                                             (1677)


          (An A c t f o r p r e v e n t i o n o f F r a u d s a n d P e r j u r y e s )




           F o r p r e v e n t i o n o f many f r a u d u l e n t P r a c t i c e s which

a r e commonly e n d e a v o u r e d t o b e u p h e l d by P e r j u r y and
S u b o r n a t i o n of P e r j u r y Bee i t e n a c t e d by t h e Kings most

e x c e l l e n t M a j e s t i e by a n d w i t h t h e a d v i c e and c o n s e n t of

t h e L o r d s S p i r i t u a l 1 and Temporal1 and t h e Commons i n

t h i s p r e s e n t P a r l y a m e n t a s s e m b l e d a n d by t h e a u t h o r i t i e

of t h e same T h a t f r o m and a f t e r t h e f o w e r a n d t w e n t y e t h

d a y of J u n e which s h a l l be i n t h e y e a r e of o u r Lord o n e

thousand s i x hundred seaventy and seaven A 1 1 Leases

E s t a t e s I n t e r e s t s o f F r e e h o l d o r Termes o f y e a r e s o r a n y

u n c e r t a i n e I n t e r e s t of i n t o o r o u t o f a n y Messuages

Mannours Lands Tenements o r H e r e d i t a m e n t s made o r c r e a t e d

by L i v e r y a n d S e i s i n o n e l y o r by P a r o l e a n d n o t p u t t i n

W r i t e i n g a n d s i g n e d by t h e p a r t i e s s o e makeing o r c r e a t i n g

t h e same o r t h e i r A g e n t s t h e r e u n t o l a w f u l l y a u t h o r i z e d by

W r i t e i n g , s h a l l h a v e t h e f o r c e a n d e f f e c t of L e a s e s o r

E s t a t e s a t Will 0nel.y and s h a l l n o t e i t h e r i n Law o r

E q u i t y be deemed o r t a k e n t o h a v e a n y o t h e r o r g r e a t e r

f o r c e o r e f f e c t , Any c o n s i d e r a t i o n f o r makeing a n y s u c h

P a r o l e L e a s e s o r E s t a t e s o r a n y f o r m e r Law o r Usage t o

t h e contrary notwithstanding.
                                                                                                   143
 11.              Except n e v e r t h e l e s s e a l l Leases n o t exceeding
       t h e terme o f t h r e e y e a r e s f r o m t h e makeing t h e r e o f

       whereupon t h e R e n t r e s e r v e d t o t h e L a n d l o r d d u r e i n g s u c h

       t e r m e s h a l l amount u n t o two t h i r d p a r t s a t t h e l e a s t o f
       t h e f u l l improved v a l u e o f t h e t h i n g demised.



111.              And moreover T h a t noe L e a s e s E s t a t e s o r I n t e r e s t s

       e i t h e r o f F r e e h o l d o r Terms o f y e a r e s o r a n y u n c e r t a i n e
       I n t e r e s t n o t b e i n g Copyhold o r Customary I n t e r e s t o f i n
       t o o r o u t o f a n y Messuages Mannours Lands Tenements o r

       Hereditaments s h a l l a t any t i m e a f t e r t h e s a i d fower and

       t w e n t y e t h d a y o f J u n e be a s s i g n e d g r a n t e d o r s u r r e n d e r e d

       u n l e s s e it b e by Deed o r Note i n W r i t e i n g s i g n e d by t h e
       p a r t y s o e a s s i g n i n g g r a n t i n g o r s u r r e n d e r i n g t h e same o r
       t h e i r A g e n t s t h e r e u n t o l a w f u l l y a u t h o r i z e d by w r i t e i n g

       o r by a c t a n d o p e r a t i o n o f Law.


                  And bee i t f u r t h e r e n a c t e d by t h e a u t h o r i t i e
       a f o r e s a i d T h a t from and a f t e r t h e s a i d fower and t w e n t y e t h

       d a y o f J u n e noe A c t i o n s h a l l b e b r o u g h t whereby t o c h a r g e

       a n y E x e c u t o r o r A d m i n i s t r a t o r upon a n y s p e c i a l l p r o m i s e
       t o a n s w e r e damages o u t o f h i s owne E s t a t e o r whereby t o

       c h a r g e t h e D e f e n d a n t upon any s p e c i a l l p r o m i s e t o a n s w e r e

       f o r t h e d e b t d e f a u l t o r miscarriages of another person o r
       t o c h a r g e a n y p e r s o n upon a n y a g r e e m e n t made upon c o n s i d e r -
       a t i o n o f M a r r i a g e o r upon a n y C o n t r a c t o r S a l e of L a n d s
       Tenements o r H e r e d i t a m e n t s o r a n y I n t e r e s t i n o r c o n c e r n i n g
       them o r upon a n y Agreement t h a t i s n o t t o be p e r f o r m e d
        144
          w i t h i n t h e s p a c e of o n e y e a r e from t h e makeing t h e r e o f

           u n l e s s e t h e Agreement upon w h i c h s u c h A c t i o n s h a l l b e

           b r o u g h t o r some Memorandum o r Note t h e r e o f s h a l l b e i n

           W r i t e i n g a n d s i g n e d by t h e p a r t i e t o b e c h a r g e d t h e r e w i t h

           o r some o t h e r p e r s o n t h e r e u n t o by him l a w f u l l y a u t h o r i z e d .


                      am. M e r c a n t i l e Law Amendment A c t 1856 ( 1 9                &   20
                      Vict. c . 9 7 1 , s. 3 :
                              No s p e c i a l P r o m i s e t o b e made by a n y P e r s o n
                      a f t e r t h e p a s s i n g of t h i s A c t t o a n s w e r f o r
                      t h e Debt, D e f a u l t , o r M i s c a r r i a g e of a n o t h e r
                      P e r s o n , b e i n g i n W r i t i n g , and s i g n e d by t h e
                      P a r t y t o b e c h a r g e d t h e r e w i t h o r some o t h e r
                      P e r s o n by him t h e r e u n t o law£ u l l y a u t h o r i z e d ,
                      s h a l l b e deemed i n v a l i d t o s u p p o r t a n A c t i o n ,
                      S u i t , o r o t h e r Proceeding t o c h a r g e t h e Person
                      by whom s u c h P r o m i s e s h a l l h a v e been made, by
                      reason o n l y t h a t t h e Consideration f o r such
                      P r o m i s e d o e s n o t a p p e a r i n P ? r i t i n g , o r by
                      n e c e s s a r y I n f e r e n c e f r o m a w r i t t e n Document.



 VII.                 And b e e i t f u r t h e r e n a c t e d by t h e a u t h o r i t i e

           a f o r e s a i d That from and a f t e r t h e s a i d fower and

           twentyeth day of June a l l Declarations o r Creations o r

           T r u s t s o r C o n f i d e n c e s o f a n y Lands Tenements o r H e r e d i t a -

           m e n t s s h a l l b e m a n i f e s t e d a n d p r o v e d by some W r i t e i n g

           s i g n e d by t h e p a r t i e who i s by Law e n a b l e d t o d e c l a r e s u c h

           T r u s t s by h i s l a s t W i l l i n F r r i t e i n g o r e l s e t h e y s h a l l be

           u t t e r l y v o i d a n d o f none e f f e c t .



VIII.                 P r o v i d e d a l w a y e s T h a t w h e r e a n y Conveyance s h a l l

           b e e made of a n y Lands o r Tenements by w h i c h a T r u s t o r

           C o n f i d e n c e s h a l l o r may a r i s e o r r e s u l t by t h e I m p l i c a t i o n

           o r C o n s t r u c t i o n of Law o r b e e t r a n s f e r r e d o r e x t i n g u i s h e d
      by a n a c t o r o p e r a t i o n o f Law t h e n and i n e v e r y s u c h                   145

      Case s u c h T r u s t o r C o n f i d e n c e s h a l l b e of t h e l i k e f o r c e

      a n d e f f e c t a s t h e same would h a v e b e e n e if t h i s S t a t u t e

      had n o t b e e n e made.          Any t h i n g h e r e i n b e f o r e c o n t a i n e d

      t o the contrary notwithstanding.



IX.              And b e e i t f u r t h e r e n a c t e d T h a t a l l G r a n t s a n d

      Assignments of any T r u s t o r Confidence s h a l l l i k e w i s e b e

      i n F 7 r i t e i n g s i g n e d by t h e p a r t i e g r a n t i n g o r a s s i g n i n g

      t h e same [ o r 1 by s u c h l a s t W i l l o r D e v i s e o r e l s e s h a l l
                        1
      l i k e w i s e b e u t t e r l y v o i d and o f none e f f e c t .

                 'interlined          on t h e R o l l .



                 And b e e it f u r t h e r e n a c t e d by t h e a u t h o r i t i e

      a f o r e s a i d That from and a f t e r t h e s a i d fower and t w e n t y e t h

      d a y of J u n e it s h a l l a n d may b e l a w f u l l f o r e v e r y S h e r i f f e

      o r o t h e r O f f i c e r t o whome a n y W r i t t o r P r e c e p t i s o r s h a l l

      b e d i r e c t e d a t t h e S u i t e of a n y p e r s o n o r p e r s o n s o f f o r

      and upon a n y Judgement S t a t u t e o r R e c o g n i z a n c e h e r e a f t e r

      t o b e made o r h a d , t o d o e make a n d d e l i v e r E x e c u t i o n u n t o

      t h e p a r t i e i n t h a t b e h a l f e s u e i n g o f a l l s u c h Lands Tene-

      m e n t s R e c t o r i e s T y t h e s R e n t s and H e r e d i t a m e n t s a s a n y

      o t h e r p e r s o n o r p e r s o n s b e i n a n y manner o f w i s e s e i s e d

      o r possessed [ o r h e r e a f t e r s h a l l be s e i s e d o r possessed 1I
      i n T r u s t f o r him a g a i n s t whome E x e c u t i o n i s s o e s u e d l i k e

      a s t h e S h e r i f f e o r o t h e r O f f i c e r might o r o u g h t t o have

      d o n e i f t h e s a i d p a r t i e a g a i n s t whome E x e c u t i o n h e r e a f t e r

                 'interlined          on t h e R o l l .
 146
       s h a l l b e s o e s u e d had b e e n e s e i s e d of s u c h Lands Tenements

       R e c t o r i e s T y t h e s R e n t s o r o t h e r H e r e d i t a m e n t s of s u c h

       E s t a t e a s t h e y be s e i z e d of i n T r u s t f o r him a t t h e t i m e

       of t h e s a i d Execution sued.                 Which Lands Tenements

       R e c t o r i e s T y t h e s R e n t s and o t h e r H e r e d i t a m e n t s by f o r c e

       and v e r t u e of s u c h E x e c u t i o n s h a l l a c c o r d i n g l y be h e l d

       and e n j o y e d f r e e d and d i s c h a r g e d from a l l Incumbrances of

       s u c h p e r s o n o r p e r s o n s a s s h a l l be s o e s e i s e d o r p o s s e s s e d

       i n T r u s t f o r t h e p e r s o n a g a i n s t whome s u c h E x e c u t i o n s h a l l

       be sued.        And i f a n y C e s t u y que T r u s t h e r e a f t e r s h a l l d y e

       l e a v e i n g a T r u s t i n Fee s i m p l e t o d e s c e n d t o h i s Heire,

       t h e r e , a n d i n e v e r y s u c h c a s e s u c h T r u s t s h a l l b e deemed

       a n d t a k e n and i s h e r e b y d e c l a r e d t o be A s s e t t s by d e s c e n t

       and t h e Heire s h a l l be l y a b l e t o and c h a r g e a b l e w i t h t h e

       O b l i g a t i o n of h i s A u n c e s t o r s f o r and by r e a s o n of s u c h

       A s s e t t s a s f u l l y and amply a s h e might o r o u g h t t o h a v e

       beene i f t h e E s t a t e i n Law had d e s c e n d e d t o him i n p o s s e s -

       s i o n i n l i k e manner a s t h e T r u s t d e s c e n d e d , Any Law Custome

       o r Usage t o t h e c o n t r a r y i n a n y w i s e n o t w i t h s t a n d i n g .



XI.                P r o v i d e d a l w a y e s T h a t noe Heire t h a t s h a l l become

       c h a r g e a b l e by r e a s o n of a n y E s t a t e o r T r u s t made A s s e t t s

       i n h i s hands by t h i s Law s h a l l b e r e a s o n of a n y k i n d e of

       P l e a o r c o n f e s s i o n of t h e A c t i o n o r s u f f e r i n g Judgement

       by N i e n t d e d i r e o r any o t h e r m a t t e r b e e c h a r g e a b l e t o pay

       t h e Condemnation o u t o f h i s owne E s t a t e b u t E x e c u t i o n

       s h a l l be s u e d of t h e whole E s t a t e s o e made A s s e t t s i n h i s               '




       hands by d e s c e n t i n whose hands s o e v e r i t s h a l l come
                                                                                            147
            a f t e r t h e W r i t t p u r c h a s e d i n t h e same manner a s it i s t o

            b e a t a n d by t h e Common Law where t h e ~ e i r e t Law
                                                                  a

            p l e a d i n g a t r u e P l e a Judgement i s p r a y e d a g a i n s t him t h e r e -

            upon.      Any t h i n g i n t h i s p r e s e n t A c t c o n t a i n e d t o t h e

            contrary notwithstanding.



XIII.                  And w h e r e a s i t h a t h b e e n e f o u n d m i s c h i e v o u s t h a t

            Judgements i n t h e K i n g s C o u r t s a t W e s t m i n s t e r d o e many

            t i m e s r e l a t e t o t h e f i r s t d a y of t h e Terme whereof t h e y
            a r e e n t r e d o r t o t h e d a y of t h e R e t u r n e of t h e O r i g i n a l l

            o r f i l e i n g t h e B a i l e and b i n d e t h e D e f e n d a n t s Lands from

            t h a t t i m e a l t h o u g h i n t r u e t h t h e y w e r e acknowledged o r

            s u f f e r e d and signed i n t h e Vacation t i m e a f t e r t h e s a i d

            Terme whereby many t i m e s P u r c h a s e r s f i n d e t h e m s e l v e s

            a g r i e v e d Bee i t e n a c t e d by t h e a u t h o r i t i e a f o r e s a i d T h a t

            from and a f t e r t h e s a i d f o u r e a n d t w e n t y e t h d a y of J u n e

            any Judge o r O f f i c e r of any of h i s Majestyes Courts of

            Westminster t h a t s h a l l s i g n e any Judgements s h a l l a t t h e

            s i g n e i n g o f t h e same w i t h o u t F e e f o r d o e i n g t h e same s e t t

            downe t h e d a y of t h e moneth and y e a r e of h i s s o e d o e i n g

            upon t h e P a p e r Booke D o c k e t t o r Record which h e s h a l l

            s i < n e which d a y o f t h e moneth a n d y e a r e s h a l l be a l s o e

            e n t r e d upon t h e Margent o f t h e R o l l of t h e Record where

            t h e s a i d Judgement s h a l l b e e n t r e d .



 XIV    .              And b e e i t e n a c t e d T h a t s u c h J u d g e m e n t s a s a g a i n s t

            P u r c h a s e r s bona f i d e f o r v a l u e a b l e c o n s i d e r a t i o n of Lands

            Tenements o r H e r e d i t a m e n t s t o b e c h a r g e d t h e r e b y s h a l l i n
  14'c o n s i d e r a t i o n of Law b e Judgements o n e l y from such t i m e

          a s t h e y s h a l l b e s o e s i g n e d and s h a l l n o t , r e l a t e t o t h e

          f i r s t . d a y of t h e Terme whereof t h e y a r e e n t r e d o r t h e d a y

          of t h e R e t u r n e o f t h e O r i g i n a l l o r f i l e i n g t h e B a i l e Any

          Law, Usage o r C o u r s e of a n y C o u r t t o t h e c o n t r a r y n o t w i t h -

          standing.



XV.                  And b e e it f u r t h e r e n a c t e d by t h e a u t h o r i t y a f o r e -

          s a i d T h a t from a n d a f t e r t h e s a i d fower and t w e n t y e t h d a y

          o f J u n e noe Writt of F i e r i f a c i a s o r o t h e r W r i t t of

          E x e c u t i o n s h a l l b i n d e t h e P r o p e r t y o f t h e Goods a g a i n s t

          whome s u c h Writt of E x e c u t i o n i s s u e d f o r t h b u t from t h e

          t i m e t h a t such W r i t t s h a l l be d e l i v e r e d t o t h e S h e r i f f e
          Under S h e r i f f e o r C o r o n e r s t o be e x e c u t e d , And f o r t h e

          b e t t e r m a n i f e s t a t i o n o f t h e s a i d t i m e t h e S h e r i f f e Under

          S h e r i f f e and C o r o n e r s t h e i r Deputyes and A g e n t s s h a l l upon

          t h e r e c e i p t of a n y s u c h W r i t t ( w i t h o u t F e e f o r d o e i n g t h e

          same) e n d o r s e upon t h e b a c k e t h e r e o f t h e d a y of t h e moneth
                1
          [or   I y e a r e whereon he o r t h e y r e c e i v e d t h e same.

                     l a n d 0.



XVI   .              And b e e it f u r t h e r e n a c t e d by t h e a u t h o r i t y a f o r e -

          s a i d T h a t from and a f t e r t h e s a i d fower and t w e n t y e t h d a y

          of J u n e noe C o n t r a c t f o r t h e S a l e of a n y Goods Wares o r

          Merchandises f o r t h e p r i c e of t e n pounds S t e r l i n g o r

          upwards s h a l l be a l l o w e d t o be good e x c e p t t h e Buyer s h a l l

          a c c e p t p a r t o f t h e Goods s o e s o l d and a c t u a l l y r e c e i v e t h e

          same o r g i v e some t h i n g i n e a r n e s t t o b i n d t h e b a r g a i n e o r
i n p a r t o f payment, o r t h a t some N o t e o r Memorandum i n

w r i t e i n g o f t h e s a i d b a r g a i n e b e made a n d s i g n e d by t h e

p a r t y e s t o be c h a r g e d by s u c h C o n t r a c t o r t h e i r A g e n t s

thereunto lawfully authorized.



           am.     S t a t u t e of F r a u d s Amendment Act l a 2 8
           ( 9 Geo.     I V . c . 1 4 ) , s. 7:

                   And Whereas by a n A c t p a s s e d i n England
           i n t h e T w e n t y - n i n t h Year o f t h e R e i q n of Kinq
                                                               - C for the-
           C h a r l e s t h e S e c o n d , i n t i t u l e d An A - - -  ~
           P r e v e n t i o n of F r a u d s a n d P e r j u r i e s , it i s ,
           among o t h e r T h i n g s , e n a c t e d , t h a t f r o m a n d
           a f t e r t h e T w e n t y - f o u r t h Day o f J u n e One t h o u -
           s a n d s i x h u n d r e d and s e v e n t y - s e v e n , no C o n t r a c t
           f o r t h e S a l e of a n y Goods, Flares, and Merchan-
           d i z e s , f o r t h e P r i c e of Ten Pounds S t e r l i n g o r
           upwards, s h a l l b e a l l o w e d t o b e g o o d , e x c e p t
           t h e Buyer s h a l l a c c e p t P a r t of t h e Goods s o
           s o l d , a n d a c t u a l l y r e c e i v e t h e same, o r g i v e
           something i n e a r n e s t t o bind t h e Bargain, o r
           i n p a r t o f Payment, o r t h a t some Note o r
           Memorandum i n W r i t i n g o f t h e s a i d B a r g a i n be
           made a n d s i g n e d by t h e P a r t i e s t o be c h a r g e d
           by s u c h C o n t r a c t , o r t h e i r A g e n t s t h e r e u n t o
           l a w f u l l y a u t h o r i z e d : And w h e r e a s a s i m i l a r
           Enactment i s c o n t a i n e d i n a n A c t p a s s e d i n
           I r e l a n d i n t h e S e v e n t h Year of t h e R e i s n o f
           King W i l l i a m t h e T h i r d : And Whereas             it     has
           been h e l d , t h a t t h e s a i d r e c i t e d E n a c t m e n t s
           do not extend t o c e r t a i n Executory Contracts
           f o r t h e S a l e o f Goods, which n e v e r t h e l e s s a r e
           w i t h i n t h e M i s c h i e f t h e r e b y i n t e n d e d t o be
           remedied; and it i s e x p e d i e n t t o extend t h e
      .    s a i d Enactments t o such Executory C o n t r a c t s ;
           Be it e n a c t e d , T h a t t h e s a i d E n a c t m e n t s s h a l l
           e x t e n d t o a l l C o n t r a c t s f o r t h e S a l e o f Goods
           o f t h e V a l u e o f Ten Pounds S t e r l i n g a n d upwards,
           n o t w i t h s t a n d i n g t h e Goods may be i n t e n d e d t o
           b e d e l i v e r e d a t some f u t u r e T i m e , o r may n o t
           a t t h e Time of s u c h C o n t r a c t b e a c t u a l l y made,
           procured, o r provided, o r f i t o r ready f o r
           D e l i v e r y , o r some Act may b e r e q u i s i t e f o r t h e
           making o r c o m p l e t i n g t h e r e o f , o r r e n d e r i n g t h e
           same f i t f o r D e l i v e r y .
                   - The
                   now
                   c. 3 2 7 ,
                                 S a l e of Goods A c t , R.S.A.
                                 s. 7:
                                                                          1970,


                       (1) A c o n t r a c t f o r t h e s a l e of any
                   goods of t h e v a l u e of f i f t y d o l l a r s o r
                   upwards i s n o t e n f o r c e a b l e by a c t i o n

                       ( a ) u n l e s s t h e buyer a c c e p t s p a r t of t h e
                              goods s o s o l d and a c t u a l l y r e c e i v e s
                              t h e same, o r g i v e s something i n
                              e a r n e s t t o bind t h e c o n t r a c t o r i n
                              p a r t payment, o r

                       ( b ) u n l e s s some n o t e o r memorandum i n
                             w r i t i n g of t h e c o n t r a c t i s made and
                             s i g n e d by t h e p a r t y t o be c h a r g e d o r
                             h i s agent i n t h a t behalf.

                           (2)      The p r o v i s i o n s of t h i s s e c t i o n
                   apply t o every such c o n t r a c t notwithstanding
                   t h a t t h e goods may b e i n t e n d e d t o be
                   d e l i v e r e d a t some f u t u r e t i m e , o r may n o t ,
                   a t t h e t i m e of t h e c o n t r a c t , be a c t u a l l y
                   made, p r o c u r e d o r p r o v i d e d o r f i t o r r e a d y
                   f o r d e l i v e r y o r t h a t some a c t may b e r e q u i -
                   s i t e f o r t h e making o r c o m p l e t i n g t h e r e o f
                   of r e n d e r i n g t h e same f i t f o r d e l i v e r y .

                           ( 3 ) T h e r e i s a n a c c e p t a n c e of goods
                   w i t h i n t h e meaning of t h i s s e c t i o n when t h e
                   buyer d o e s a n y a c t , i n r e l a t i o n t o t h e goods,
                   t h a t r e c o g n i z e s a p r e - e x i s t i n g c o n t r a c t of
                   s a l e whether t h e r e i s a n acceptance i n per-
                   formance of t h e c o n t r a c t o r n o t .



XVII.              And b e e i t f u r t h e r e n a c t e d by t h e a u t h o r i t y a f o r e -

        s a i d T h a t t h e d a y of t h e moneth and y e a r e of t h e E n r o l l m e n t

        of t h e Recognizances s h a l l be s e t t downe i n t h e Margent of

        t h e R o l l where t h e s a i d Recognizances a r e e n r o l l e d , and

        t h a t from and a f t e r t h e s a i d fower and t w e n t y e t h day of

        J u n e noe Recognizance s h a l l b i n d e any Lands Tenements o r

        H e r e d i t a m e n t s i n t h e hands of a n y P u r c h a s o r bona f i d e and

        f o r v a l u e a b l e c o n s i d e r a t i o n b u t from t h e t i m e o f s u c h

        E n r o l l m e n t , Any Law Usage o r Course of a n y C o u r t t o t h e

        c o n t r a r y i n any w i s e n o t w i t h s t a n d i n g .
                                APPENDIX C


          S t a t u t e of F r a u d s Amendment A c t [Lord
          T e n t e r d e n ' s A c t ] ( 1 8 2 8 ) 9 Geo. I V , c . 1 4 ,
          ss.
          - 5 and 6 .
 V.   And b e i t f u r t h e r e n a c t e d , T h a t n o A c t i o n s h a l l
      be m a i n t a i n e d whereby t o c h a r g e any P e r s o n upon
      any P r o m i s e made a f t e r f u l l Age t o pay any Debt
      c o n t r a c t e d d u r i n g I n f a n c y , o r upon any R a t i f i c a -
      t i o n a f t e r f u l l a g e o f any Promise o r Simple
      C o n t r a c t made d u r i n g I n f a n c y , u n l e s s s u c h P r o m i s e
      o r R a t i f i c a t i o n s h a l l b e made by some W r i t i n g
      s i g n e d by t h e P a r t y t o b e c h a r g e d t h e r e w i t h .



VI.   And b e it f u r t h e r e n a c t e d , T h a t n o A c t i o n
      s h a l l b e b r o u g h t whereby t o c h a r g e any P e r s o n
      upon o r by r e a s o n of any R e p r e s e n t a t i o n o r
      A s s u r a n c e made o r g i v e n c o n c e r n i n g o r r e l a t i n g
      t o t h e C h a r a c t e r , Conduct, C r e d i t , A b i l i t y ,
      T r a d e , o r D e a l i n g s o f any o t h e r P e r s o n , t o t h e
      i n t e n t o r P u r p o s e t h a t s u c h o t h e r P e r s o n may
      o b t a i n C r e d i t , Money, o r Goods upon d e a t h , u n l e s s
      s u c h R e p r e s e n t a t i o n o r A s s u r a n c e b e made i n
      W r i t i n g , s i g n e d by t h e P a r t y t o b e c h a r g e d
      therewith      .
                                 Appendix D


             T h e Guarantees Acknowledgment A c t , 1969
     [S.A.                                                          -
              1 9 6 9 , c. 4 1 , a s amended by S.A. 1 9 7 0 , c. 511


1.     This A c t may be c i t e d a s The Guarantees Acknowledgment
      Act,     1969.

2,     In t h i s A c t ,

       (a) " g u a r a n t e e " means a deed o r w r i t t e n agreement
           whereby a p e r s o n , n o t b e i n g a c o r p o r a t i o n ,
           e n t e r s i n t o an o b l i g a t i o n t o answer f o r an
           a c t o r d e f a u l t o r omission of a n o t h e r b u t
           does n o t i n c l u d e
                 (i) a b i l l o f exchange, cheque o r promissory
                     note, o r
                (ii)a . p a r t n e r s h i p agreement, o r
              (iii)a bond o r r e c o g n i z a n c e g i v e n

                       (A) t o    the Crown, o r
                       (B) t o a c o u r t o r judge, o r
                       (C) p u r s u a n t t o a s t a t u t e ,



                ( i v ) a g u a r a n t e e g i v e n on t h e s a l e of

                       (A) any i n t e r e s t i n l a n d , o r
                       (B) any i n t e r e s t i n goods o r c h a t t e l s ;

       (b) " n o t a r y p u b l i c " means,

                 (i) w i t h r e f e r e n c e t o an acknowledgment made
                       i n A l b e r t a , a n o t a r y p u b l i c i n and f o r
                       A l b e r t a , and
                (ii)w i t h r e f e r e n c e t o an acknowledgment made
                    i n j u r i s d i c t i o n outside Alberta, a notary
                    p u b l i c i n and f o r t h a t j u r i s d i c t i o n . '
                                                                  #



3.    o
     N g u a r a n t e e h a s any e f f e c t u n l e s s t h e p e r s o n

     entering i n t o t h e obligation:

     (a) a p p e a r s b e f o r e a n o t a r y p u b l i c ,
     ( b ) acknowledges b e f o r e t h e n o t a r y p u b l i c t h a t
           h e e x e c u t e d t h e g u a r a n t e e , and

     (c) i n t h e presence of t h e notary public s i g n s
         a statement, a t t h e f o o t of t h e c e r t i f i c a t e
         o f t h e n o t a r y p u b l i c i n t h e form s e t o u t i n
         t h e Schedule.

     (1) The n o t a r y p u b l i c , a f t e r b e i n g s a t i s f i e d
           by e x a m i n a t i o n of t h e p e r s o n e n t e r i n g t h e
           o b l i g a t i o n t h a t he i s aware o f t h e c o n t e c t s
           o f t h e g u a r a n t e e and u n d e r s t a n d s i t , s h a l l
           i s s u e a c e r t i f i c a t e under h i s hand and s e a l
           o f o f f i c e i n t h e form s e t o u t i n t h e Schedule.
      ( 2 ) Every c e r t i f i c a t e i s s u e d under t h i s A c t
           s h a l l b e a t t a c h e d t o o r n o t e d upon t h e
           instrunient containing t h e guarantee t o
           which t h e c e r t i f i c a t e r e l a t e s .


5.   A c e r t i f i c a t e i s s u e d under t h i s A c t

      {a) s u b s t a n t i a l l y complete and r e g u l a r on t h e f a c e
          of it, and
      (b) a c c e p t e d i n good f a i t h by t h e p e r s o n t o whom
           t h e o b l i g a t i o n was i n c u r r e d w i t h o u t r e a s o n t o
           b e l i e v e t h a t t h e r e q u i r e m e n t s of t h i s Act have
           n o t been complied w i t h
     s h a l l b e a d m i t t e d i n e v i d e n c e and i s c o n c l u s i v e proof

     t h a t t h i s A c t h a s been complied w i t h .


6.   The f e e p a y a b l e t o a n o t a r y p u b l i c f o r t h e i s s u e of
     a. c e r t i f i c a t e under t h i s A c t and a l l i n c i d e n t a l

     s e r v i c e s s h a l l n o t exceed $5.
                                     Schedule

              The Guarantees Acknowledgment A c t , 1 9 6 9

                      C e r t i f i c a t e of Notary P u b l i c


I hereby c e r t i f y t h a t :


1.                                    of                               t h e guarantor

     i n t h e guarantee d a t e d                                    made between

     --                                       and                                        I



     which t h i s c e r t i f i c a t e i s a t t a c h e d t o o r noted upon,
                                      e
     appeared i n person b e f o r e m and acknowledged t h a t he
     had executed t h e guarantee;

2.    I s a t i s f i e d myself by examination of him t h a t he i s aware

     of t h e c o n t e n t s of t h e guarantee and understands it.

Given a t                                       this                day of               I


1 9-- under m hand and s e a l of o f f i c e .
             y


[Seal]


                                           Notary P u b l i c i n and f o r
                          S t a t e m e n t of G u a r a n t o r


I arn t h e p e r s o n named i n this c e r t i f i c a t e .




                                                Signature of Guarantor

				
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