An oral agreement, also known as a verbal agreement, is a contract made through spoken words and not through written documentation. While oral agreements can be legally binding, they are more difficult to enforce in court than written agreements. This is because it can be challenging to prove the terms of the agreement without written evidence.
When it comes to legal matters, it is always best to have a written contract. However, in some situations, oral agreements may be necessary or preferred. For example, if two parties need to come to a quick agreement, they may opt for an oral agreement rather than going through the process of drafting and signing a written contract.
It is essential to note that not all agreements can be made orally. Some contracts require written documentation, such as real estate transactions and contracts lasting more than one year. Additionally, some states require specific contracts to be in writing, such as contracts related to debt, marriage, and sales over a certain amount.
If you do choose to enter into an oral agreement, there are a few things you should keep in mind. First, make sure that all parties involved clearly understand the terms of the agreement. This means that you should be explicit about what is expected from each party and the consequences if those expectations are not met.
It is also crucial to record the oral agreement in some way. This can be as simple as writing down the terms of the agreement and having all parties sign the document. You can also send an email outlining the agreement and asking all parties to confirm their acceptance via email reply.
While oral agreements can be legally binding, they are more challenging to prove in court. If you need to enforce an oral agreement, you will need to provide evidence that the agreement was made, such as witness statements or recordings of the agreement. Keep in mind that some states have laws that require that a recording of the agreement is made with the consent of all parties involved.
In summary, while oral agreements are not always the best option, they can be useful in certain situations. If you do enter into an oral agreement, make sure that all parties understand the terms of the agreement and take steps to record the agreement in some way. Remember, if you ever need to enforce the agreement in court, you will need to provide evidence that the agreement was made.