Historically, an individual’s word and a handshake were the most common means of doing business. Although most business owners now use written contracts in conducting business, verbal or oral contracts are still enforceable under Florida law under specific circumstances. However, these contracts can be complicated to enforce when formal written evidence of a contract is absent.
Whether you wish to enforce a verbal contract or face allegations of breach of a verbal contract, we are here to help. A Florida business transaction attorney at Kramer Green can evaluate your situation and determine the best strategies for handling a verbal contract.
Elements of a Contract
An agreement between two or more parties must contain specific elements to constitute a legally binding contract, whether written or verbal, under Florida law. These elements include:
- Offer – One party must make a genuine offer to one or more other parties to take action or refrain from taking some action.
- Acceptance – The party receiving the offer must accept it.
- Mutual Agreement – The parties must have a “meeting of the minds.” In other words, the parties must have the same or deemed understanding of the terms of the agreement.
- Consideration – The parties must each promise something of value, such as goods, services, or money.
Additionally, the parties to the contract must be legal adults (with some exceptions) of sound mind to enter into a contract. The contract may be legally invalid if one party is a minor or is legally incompetent.
Finally, a legally binding contract may not require a party to do something illegal or involve the sale of illegal goods, such as illegal drugs. As a result, a verbal contract that requires one party to pay the other party money to commit a crime is not legally binding.
Exceptions to Verbal Contracts
Under Florida law, some contracts must be written to be enforceable. Otherwise, a court will not enforce them. These contracts include the following:
- Real estate transactions;
- Leases that last longer than one year;
- Guarantees of another’s person’s debt;
- Contracts that a party cannot perform within one year;
- Purchase agreements for goods at a price of $500 or more; and
Therefore, if you verbally agree to any of these types of contracts and do not sign a written contract, the contract is usually not legally enforceable. I
Proving Breach of a Verbal Contract
While verbal contracts are legally valid and enforceable under Florida law, a breach of a verbal contract can be difficult to prove. Unlike a written contract, in which you have a written document that all parties to the contract have signed, the existence of a verbal contract typically involves one party’s word against the other.
However, you may have various ways to prove that a verbal contract exists. For instance, you may have proof of your agreement through correspondence with the other party, such as emails, text messages, or voicemail messages. You also may have witnesses to your conversations with the other party about the verbal contract. You also may have proof that you made full or partial payments to the other party or that the other party made payments to you.
Partial performance also can be proof of the existence of a verbal contract. For example, suppose that you paid a sum for certain services, and the other party only provided you with half the services you agreed upon. In that case, you could use the other party’s partial performance to show that you did have a verbal contract with the party.
In any breach of contract case, you must be able to prove that you suffered damages because of the breach. If you suffered no damages due to the other party’s failure to follow through with the contract, then you have no cause of action against the other party. For instance, if you agreed to sell a pair of shoes to someone for $200, and the party backed out of the agreement, but you had not yet delivered the shoes to him, you still can sell the shoes to someone else for the same price. Since you have not been damaged by the other party’s failure to complete the contract, you have suffered no damages that would justify a breach of contract claim.
Finally, whether your contract is written or oral, you only have a limited time under Florida law to enforce your rights under the contract. However, unlike a written contract, which you have five years to enforce, Florida Statute § 95.11(3)(k) gives you only four years to enforce the terms of an oral contract that another party has breached.
Allow Us to Assist You with Your Business Law Needs Today
A business transaction attorney at Kramer, Green, Zuckerman, Greene & Buchsbaum, P.A. can provide the tools you need to help your business operate smoothly. We also can provide you with legal counsel and representation when a breach of contract occurs. Call us today at (954) 966-2112 or contact us online to set up a time to discuss your legal issues with our experienced business lawyers.