Are Oral Contracts Enforceable?

Posted in Contracts by Nick Hansen on July 6th, 2016

A contract can be written, oral or even implied by the actions of the involved parties. While written contracts can clearly be enforced in a court of law, people often wonder whether they have any legal recourse in the event of a breach of oral contracts.

Can an oral contract actually be enforced? Whether you’re thinking about agreeing to an oral contract or you’ve already entered into one and the other party isn’t fulfilling their end of the deal, this is an important question to consider, and one that could lead to a breach of contract.

Oral contracts are enforceable in many instances, despite popular belief. In most situations, though, you are

oral contracts

Oral Contracts ARE a Form of Contract!

usually better off placing your agreement in writing. Trying to enforce an oral contract often results in a “he said, she said” battle, and without proper evidence, it can be difficult to achieve the desired outcome.  This is why it’s much more preferable to use a contract lawyer that is well versed in contract formation to create a written contract, as opposed to using an oral contract.

Statute of Frauds

There are, however, instances in which an oral contract is not acceptable. This concept exists to prevent deceitful conduct in high-value or long-term situations. In most states, the Statue of Frauds requires a written contract in situations, including:

  • Real estate sales
  • Real estate lease agreements lasting longer than one year
  • Property transfers after the owner’s death
  • Contracts that take more than one year to complete
  • Agreements to pay someone else’s debt
  • Contracts that last longer than the life of a party
  • Contracts over a certain amount. The amount differs by state.

In most instances, courts will not enforce oral contracts that fall into these categories. In order to be enforceable, there needs to be some sort of written agreement.

However, there are a few situations in which an oral contract can be enforced even if is in one of these categories. If one party partially complied and/or performed with the terms of the oral agreement or if the plaintiff relied on the defendant’s promise and suffered a major problem as the result, the court may still enforce the oral contract.

The law does not favor oral contracts, but in many situations, they can be enforced by the court. However, the burden of providing evidence falls on the plaintiff. You are much more likely to receive a favorable judgment from the court if you are able to provide at least some kind of evidence or documentation, like emails, text messages, or cancelled checks, to provide circumstantial evidence of the existence of an oral contract.

If you need help enforcing an oral contract, contact Hansen Law Firm. For a free consultation, please call 303-785-7777.

 

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