Does it Have to be in Writing? Answering Your Questions About Oral Agreements

By Josh Borsellino

“If you don’t have it in writing, you don’t have it at all.” That is a popular saying that is frequently used to encourage people to put their agreements in writing. But it is not always true. There is considerable confusion among non-lawyers (and even some attorneys) as to whether a contract must be in writing to be enforceable under Texas law. There is no simple answer to this question, but it is fair to say that oral agreements can be enforceable under some circumstances. Under Texas law, there are four basic requirements to proving the existence of a legally enforceable contract:

• an offer
• an acceptance
• mutual assent (sometimes called a “meeting of the minds”)
• consideration from both sides that would support the contract.

Of course, a written agreement is much more desirable than an oral agreement, as it allows the parties to avoid a swearing match as to what the terms of their agreement were. Nonetheless, it is possible for parties to satisfy all four of the elements listed above through an oral agreement.

Texas recognizes a defense to a claim for breach of contract known as the “statute of frauds.” A contract that is subject to the statute of frauds, such as one for the sale of real estate or one that cannot be performed in less than one year, must be in writing and signed by the party against whom the contract will be enforced. But there are exceptions to the statute of frauds. For example, an oral agreement to purchase real property or a contract that cannot be performed in less than one year (which would ordinarily be required to be in writing) is enforceable if it is proven that the agreement was partially performed by the parties.

In conclusion, oral agreements may be enforceable. If you have entered into an oral agreement and are seeking to determine whether you can enforce your legal rights, please contact Josh Borsellino at Bailey & Galyen at (817) 276-6000. Mr. Borsellino is licensed to practice only in the state of Texas.

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