Martin Enters into a Verbal Contract with Marlowe Ltd

question 21

Multiple Choice

Martin enters into a verbal contract with Marlowe Ltd. to investigate their operations and their accounting systems, make recommendations as to how to improve them, and help implement the changes Marlowe Ltd. accepts. In the negotiations, Martin makes it clear that he cannot give Marlowe Ltd. a definite timetable and that it is clear that the whole process will take longer than a year. Part of their agreement is that either party may terminate the contract on 60 days' written notice to the other if the work is progressing unsatisfactorily. In this situation,

• A) since the contract is for an indefinite period, it falls under the Statute of Frauds and is not enforceable.
• B) if this contract is not completed within a year, it will fall under the Statute of Frauds and will become unenforceable at that point.
• C) since this is a contract for services, it is not covered by the Statute of Frauds and is enforceable.
• D) since this contract cannot be performed within the period of one year from the date it was made, it falls under the Statute of Frauds and is not enforceable.
• E) since this contract could be terminated within one year of being made, it does not fall under the Statute of Frauds even if it is not terminated within the year and is enforceable.

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