Oral Promises – Are They Enforceable?
Verbal agreements, though commonplace, often lead to questions about their legal standing. In this exploration of oral promises, we unravel the complexities surrounding their enforceability.
Section 1: The Basics of Contract Law:
Contract law is the foundation upon which the enforceability of oral promises rests. A valid contract comprises an offer, acceptance, consideration, and the intention to create legal relations. Within this framework, oral agreements find their place.
Section 2: When Oral Agreements Are Enforceable:
Contrary to common belief, verbal commitments can be legally binding. The circumstances under which a spoken promise becomes enforceable depend on factors such as the nature of the agreement, the parties involved and whether the oral agreement doesn’t go against rules regarding specific requirements for written contacts.
Section 3: Statute of Frauds:
The Statute of Frauds introduces an interesting dimension. Certain agreements must be in writing to be legally valid. The statute’s impact on the validity and enforceability of agreements can be explored with a qualified attorney. As a non-exhaustive list, examples of how the Statute of Frauds can impact agreements: Agreements between parties regarding the sale or transfer of real property interest needs to be in writing; A promise between parties, but the agreement is not for something meant to be done during the lifetime of the person making that promise, must be in writing; A promise to pay the debt or default of a third-party must be in writing.
Section 4: Exceptions and Considerations:
While written contracts are the norm, exceptions exist. Oral promises can still be enforceable, especially in situations where one party relies on the commitment to their detriment or when partial performance has occurred. However, because the possibility of fraud is so great, for a party to prove there was an unwritten and oral promise, they must prove to a court by clear and convincing evidence that a contract with specific terms to which parties specifically agreed to actually exists.
Section 5: Practical Tips and Cautionary Tales:
Navigating oral agreements requires caution. We offer practical advice, advocating for documentation whenever possible. Real-life stories underscore the importance of clarity and the potential pitfalls of relying solely on verbal assurances.
Clarity and transparency stand as the pillars of secure agreements. While oral promises can be legally binding, documenting agreements adds a layer of protection against potential disputes.
Solan, Park & Robello
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