Verbal Agreements: What You Need to Know
In today`s fast-paced business environment, verbal agreements are becoming increasingly common. These agreements can be made over the phone, in person, or even through email. While verbal agreements can be convenient, they can also be risky if not handled correctly.
So, what exactly is a verbal agreement? Simply put, a verbal agreement is a contract that is made verbally rather than in writing. This type of agreement can be made between two individuals or between a business and an individual. While verbal agreements are legally binding, they can be more difficult to enforce than written contracts.
Here are a few things you need to know about verbal agreements:
1. Verbal agreements are legally binding
Contrary to popular belief, verbal agreements are just as legally binding as written contracts. This means that if one party fails to honor the terms of the agreement, legal action can be taken.
2. Verbal agreements can be difficult to prove
One of the main challenges of verbal agreements is that they can be difficult to prove in court. This is because there is often no written record of the agreement. As a result, it is important to document any verbal agreements through email or by sending a confirmation letter.
3. Verbal agreements are subject to misunderstandings
Another common problem with verbal agreements is that they are subject to misunderstandings. This can occur if one party does not fully understand the terms of the agreement or if there is a miscommunication.
4. Verbal agreements should be avoided if possible
In general, it is best to avoid verbal agreements if possible. Instead, it is recommended to put all agreements in writing to avoid any potential misunderstandings or legal disputes.
In conclusion, verbal agreements can be a convenient way to make a contract, but they can also be risky if not handled correctly. If you do decide to make a verbal agreement, be sure to document it thoroughly and be aware of the potential risks involved. Alternatively, consider putting the agreement in writing to avoid any potential problems down the road.