Breach of Contract Verbal Agreement: What it Means and How to Protect Yourself
When entering into any business agreement, whether written or verbal, it is important to understand the terms and conditions of the deal. In many cases, verbal agreements can be just as binding as written contracts. However, if one party fails to uphold their end of the agreement, this can result in a breach of contract. In this article, we will explore what it means to breach a verbal agreement, what steps you can take to protect yourself, and how to handle a breach of contract situation.
What is a Verbal Agreement?
A verbal agreement, also known as an oral contract, is a legally binding agreement made between two or more parties without a written document. Verbal agreements can be just as binding as a written contract and are often used in business transactions, employment agreements, and real estate transactions. However, verbal agreements can be challenging to enforce, especially if there is no proof of the agreement.
What is a Breach of Contract?
A breach of contract occurs when one party fails to uphold their end of the agreement. This can include failing to deliver goods or services as promised, not paying the agreed-upon amount, or not fulfilling any other obligation outlined in the agreement. In the case of verbal agreements, a breach of contract can be even more challenging to prove, as there is no written documentation to reference.
How to Protect Yourself in a Verbal Agreement
While written contracts are the most reliable way to protect yourself in a business agreement, there are still ways to safeguard yourself in a verbal agreement. Here are a few tips:
1. Get it in writing: If it is possible, get the agreement in writing. This can be a simple email outlining the terms of the agreement or a more formal contract. Having something in writing will make it easier to prove the agreement and any obligations outlined in it.
2. Clarify the terms: Before agreeing to anything, make sure you understand all the terms and conditions. Clarify any confusing language or ask for specific details about what is expected of you and the other party.
3. Keep a record: Keep a record of all communications related to the agreement, including emails, phone calls, and text messages. This will provide evidence of the agreement and any discussions that took place.
What to Do if there is a Breach of Contract
If you believe there has been a breach of contract in a verbal agreement, there are steps you can take to address the situation.
1. Talk to the other party: The first step is to talk to the other party and try to resolve the issue. This can be done through a phone call or an in-person meeting. Explain your concerns and discuss how the other party can fulfill their end of the agreement.
2. Send a demand letter: If talking to the other party does not result in a satisfactory resolution, you can send a demand letter outlining the breach of contract and the consequences if the other party does not fulfill their obligations.
3. Seek legal action: If all else fails, you may need to seek legal action to enforce the agreement. This can include filing a lawsuit or seeking arbitration.
In conclusion, while verbal agreements can be binding, they can also be challenging to enforce if a breach of contract occurs. To protect yourself, it is always best to get the agreement in writing or, at the very least, clarify the terms and keep a record of all communications. If a breach of contract occurs, try to resolve the issue through communication, send a demand letter, and seek legal action if necessary. By following these steps, you can protect yourself from a breach of contract in a verbal agreement.