Talks on Verbal Contracts

by Sunanda K. Chavan on Monday 30 May 2011, 2:47 PM | Category: Company Agreements & Contracts| View: 2834 views

A verbal contract is any contract which is expressed in words and is anyways quite a common definition of verbal contract.

Whether a verbal agreement is an enforceable contract depends on the type of deal you're talking about. 

Three types of agreements that usually always make the list of verbal agreements are real estate transactions, service agreements that can't possibly be performed in less than a year, and certain contracts for the sale of goods.

Proving the deal is very difficult mainly because transactions by their nature are dynamic and evolve over time. 

So while some verbal agreements are enforceable, in the long run they may be more trouble than their worth because they're only as “good” as the paper they're written on.

A contract whether verbal or written has three elements: offer, acceptance and consideration.  In contract law, lawyers and judges say that the parties must have a "meeting of the minds;" that is, both parties need to intend to enter into a contract.


Certain types of agreements must be written can never be verbal. These agreements are governed by what is called the Statute of Frauds. The law says that any agreements governing the sale or transfer of land, creditor or debtor relationships, services that cannot be performed within one year or the sale of goods regulated by the Uniform Commercial Code must be in writing. Even if you can prove the terms of a verbal agreement, contracts governed by the Statute of Frauds are not legally valid unless written and signed by the parties involved.

If you make a verbal agreement and wish to avoid the problems with evidence, you can ask for written confirmation of the terms of your agreement. This can be done simply by writing an e-mail to the other person outlining the terms you verbally agreed on. When the other party writes back confirming your terms, you have essentially turned what was a verbal agreement into a written contract. This e-mail exchange can be used to prove the terms of your agreement in court.

 The credibility of the party can also be established or questioned in court.  This isn't the same thing as witness credibility or character credibility.  It's more a matter of proving that an individual action or statement was credible or incredible.  If a person walks inside a restaurant and orders food then it's understood that a binding oral contract is made.  Claiming that one thought the food was free and refusing to pay for the service would be an incredible incident, and unlikely to hold up in court. 



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