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WHAT IS THE STATUTE OF FRAUDS AND ARE ORAL OR VERBAL AGREEMENTS ENFORCEABLE?

So much of what we do in life and in business is done verbally. And it is not uncommon, and often typical, to enter a handshake deal, where you have agreed to enter agreements verbally or orally. This begs the question as to whether or not oral agreements are enforceable in California. The simple answer is yes. However, certain types of agreements need to be in writing to be enforceable.

In California, there is something referred to as the statute of frauds which says that certain types of agreements need to be in writing. One example of a type of agreement that is covered by the statute of frauds are agreements that require more than a year to be performed. However, even when the statute of frauds might apply to an agreement, requiring the agreement to be in writing, the statute of frauds has many exceptions. Therefore, even if an agreement is oral, and the statute of frauds would otherwise apply to that agreement requiring it to be in writing, an exception may apply, making it permissible that the contract is an oral contract.

It is always best to get a contract in writing. It eliminates the possibility that the other party to the agreement might deny the existence of the agreement, and it avoids disputes regarding what the terms of the agreement might be. If you must enter an agreement verbally, you should, at a minimum, confirm in writing the basic terms of the agreement. Often a simple email can overcome the limitations of the statute of frauds, and can avoid later disputes as to whether there was an agreement, or what the terms of the agreement might be.

I regularly represent clients in East Bay, California in contract disputes involving oral or verbal agreements, as well as disputes involving written agreements. If you have questions, or need representation by a California contract attorney involving a contract dispute or issue, please feel free to contact me to arrange for a consultation at (510) 465-0025.

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