A contract doesn’t always need to be in writing to be legally binding. In many cases, verbal agreements qualify. Each state has a so-called statute of frauds, which specifies which contracts must be in writing to be enforceable—the sale of land is a common example. Such exceptions aside, find out what it takes to make a verbal promise hold up in the eyes of a lawyer below.

What Makes a Verbal Contract Valid?

For any pact to be valid, it must encompass both an offer and an acceptance of that offer. Say you are selling an old couch for $200. A prospective buyer checks it out and agrees to accept the couch for that price. A contract has been made.

Additionally, both parties must knowingly give up something of actual value in exchange for the agreement. There also can’t be what lawyers call a “defense to enforcement” that would bar the pact from being imposed—for instance, if one person lacks the mental capacity to enter into a contract. 

What Happens When Disputes Arise?

The problem is that—since nothing is written down—if the two parties involved disagree on the terms, there is no point of reference. It becomes a case of he said, she said, making it harder for courts to enforce the contract when disputes arise.

It’s not impossible, however. For the couch example: Say you transfer $200 to the seller’s bank account and they then disappear, failing to deliver the item. The bank records could be evidence of the deal. If a witness was present when you made the agreement, this could also be useful. 

Whether it’s an employment offer or a car sale, it’s usually best to err on the side of caution and have a lawyer draft a written contract. Let the attorneys of Morrow, Gordon & Byrd, Ltd. create legally binding documentation of your agreement to protect your interests. Located in Newark, OH, they serve clients throughout New Albany and Westerville with guidance backed by over 80 years of experience. Visit their website for an overview of their team’s practice areas, from bankruptcy to business law. To schedule a meeting with a lawyer, call (740) 345-9611.