Is a verbal offer to do business with someone for a cut of profits enforceable? What if someone verbally opts out and then changes their mind and still wants the cut? If you offer are you obligated to stick with them even if the relationship goes south or they bring little value to the business? I know you’re not an attorney, so your opinion please.
Generally, oral or verbal contracts are indeed legally enforceable, but there’s a fundamental problem: how do you prove what was agreed upon? That’s why written contracts are far more useful, because everything’s down in, well, black and white.
Here are some thoughts on this subject from around the Web.
Fran Przyblewski wrote a good piece in SeniorMag that highlights:
“The problem with verbal contracts are that they are often very hard to prove, especially if they are very complicated or have no independent witnesses. The parties themselves may not even recall the exact details to which they agreed. Therefore, if neither side can can show a written contract, judges are often forced to apply “fairness” or other governing state laws. The problem with “fairness” is that at least one person won’t consider it “fair.”
“In general, try to avoid verbal contracts. Anyone that wants you to agree to something but won’t put it into writing, just isn’t worth the time. And they are very likely out to scam you.”
Wikipedia, in its article about oral contracts, says:
“In general, oral contracts are just as valid as written ones, but some jurisdictions either require a contract to be in writing in certain circumstances (for example where real property is being conveyed), or that a contract be evidenced in writing (though it may be oral). An example of the latter being the requirement that contract of guarantee be evidenced in writing that is found in the Statute of Frauds. Similarly, the limitation period prescribed for an action may be shorter for an oral contract than it is for a written one.”
And, finally, Law.com says:
“an agreement made with spoken words and either no writing or only partially written. An oral contract is just as valid as a written agreement. The main problem with an oral contract is proving its existence or the terms. As one wag observed: “An oral contract is as good as the paper it’s written on.” An oral contract is often provable by action taken by one or both parties which is obviously in reliance on the existence of a contract. The other significant difference between oral and written contracts is that the time to sue for breach of an oral contract (the statute of limitations) is sometimes shorter. For example, California’s limitation is two years for oral compared to four for written, Connecticut and Washington three for oral rather than six for written, and Georgia four for oral instead of 20 for written.”
Hope that’s helpful. Good luck.