Verbal Agreement Over Phone Legally Binding

The purpose of the contract must be legal. In our example, the nephew`s reason is to borrow money from his aunt to replace a flat tire on his car. As such, the contract between them is legal. However, if the nephew wanted to lend money to illegally modify his car (z.B. installing lights to mimic a police car), the purpose becomes illegal and the contract is invalid. There can be serious consequences for breach of contract, whether oral or written. Therefore, if you are unsure of the terms and do not fully understand your rights or obligations, we recommend that you get legal advice before the contract is concluded. For a verbal agreement to be binding, the elements of a valid contract must be present. To illustrate how the elements of a contract create binding conditions in an oral agreement, we use the example of a man who borrows $200 from his aunt to replace a flat tire. Be sure to review your state`s fraud laws or law if you are not sure if you need a written agreement or not. The threat of legal action for breach of an oral contract cannot at all help the case if a party intends to violate the agreement. However, the law considers that full oral agreements are legally binding and that the case can be brought before the courts so that a judge can make the final decision.

An oral contract is a verbal agreement between the parties, sometimes legally binding. The lack of hard evidence is a problem with proof of an oral contract. Just like the aunt in our imaginary scenario, you`re probably better off documenting a written agreement. Something as simple as a promised note, detailing the nephew`s promise to repay his aunt, could have avoided any quarrel over their agreement. Finally, it is less difficult to ask family members for a written loan than to bring them to justice. According to the sources, there may be between four and six elements that make a treaty legally binding. Some sources consolidate elements under the same title. The six possible elements are: To sue someone for breach of an oral contract, you must prove that there was a binding agreement.