A contract can be either in writing or agreed to verbally. There are a few exclusions to this such as real estate contracts which must be in writing. The problem with verbal contracts is that the terms agreed to are not easily identifiable which makes such contracts hard to enforce and that is why most contracts are in writing.
A verbal contract does not clearly outline the rights and responsibilities of the parties, including acts that breach the agreement. Even where a breach is established, without express remedies, the breach may not be easily cured. It is always best to enter into a written contract to protect one’s own interest.
If you have entered into a verbal contract the essential elements of a contract need to exist for it to be a contract. These are acceptance and offer; intention to create a legal relationship and consideration (money).
You can take steps to validate a verbal contract and some of these are:
- Confirming the discussions in writing by email or letter to the other side;
- Keeping records of supporting documentation such as quotes, emails, letters and text messages;
- Recording work being done and any payments being made or received for the work; and
- Take diary notes of any phone calls and communications with the other party.
- Taking these additional steps will assist if a dispute arises and there are any claims in future for liability etc.
It is essential to have clear written agreements and contracts in place if you routinely do work for other parties so that all parties have a clear understanding of what is expected. At Appius lawyers, we can prepare your contracts, so that you are protected in the course of your business.
If you need legal advice, we can be contacted on 08 6180 0600 or via the contact form on this page.
