Broken Oral Agreements

Every day, oral contracts are made with no intention or even feeling that they need to be written down. This may happen in person or over the phone for services or products like utilities, car insurance, or deliveries. The parties orally have agreed to the terms. Or an insurance agent may have interpreted the written contract to say that everything is covered under the policy. That constitutes a contract that is just as binding as a written one.

Many state and federal laws exist to ensure enforcement of oral contracts. Some states may have laws (called statutes of frauds) that regulate the type of property or amount of money an oral contract can involve. States also have a statute of limitation on any contract.

While all important contracts should be written, oral contracts are often a convenient and commonly used form of agreement between people or companies.