statute of frauds oral loan agreement

What is the borrower claiming? The statute of frauds is a defense that a contract exists. It may not work as a defense against fraud that one party attempted to mislead another party into thinking that a written contract was forthcoming in order to fraudulently induce that party into taking another action.

 

The statute of frauds should not absolutely bar someone from proving that a margin loan was to take place. One could argue a number of legal theories, e.g. unjust enrichment, detrimental reliance (I'll explain if necessary), etc. However, with a transaction of this magnitude, it would seem that the plaintiff would have a very difficult time proving this deal unless there was some written evidence that a loan was to take place and all the relevant and necessary numbers. If this was simply an open promise "we'll make you a special loan if you allow us to handle your IPO", then that might not be seen as there truly being a meeting of the minds with regard to that part of the transaction. it could also call into question whether or not the IPO was handled by this firm as a result of the promise to make a loan.