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The Law & Verbal Agreements

By: Garry Crystal - Updated: 28 Apr 2016 | comments*Discuss
 
Verbal Agreements Legal Binding

Many people are not aware that verbal agreements are in many cases as legally binding as written contracts. Verbal contracts can be upheld by a court if someone decides to breach the agreement, although without written terms and conditions it may be difficult to prove.

Conditions of a Verbal Agreement

Under law there are two basic terms that constitute a binding agreement. The verbal agreement will be binding if there was an agreement on the services to be performed and an agreement was reached on remuneration for this service. This agreement can be reached by a verbal exchange in person, via telephone or via an email.

There are certain contracts and agreements that must be made in writing and these will include the sale of property, tenancy agreements, copyright transfer, and contracts for consumer credit. In some cases, verbal agreements will not be upheld in court, not because of the lack of a written agreement but because the terms of the verbal agreement were not clarified.

Written Agreements

For any agreement concerning an exchange of services it is a wise idea to have some form of contract or written statement. The contract or statement should include the terms and conditions of the agreement and is particularly helpful if a dispute between the parties occurs.

Complete Verbal Agreements

In order for a verbal agreement to be legally binding the agreement must have reached completeness. This means that all terms and conditions have been reached and agreed regarding services and terms of pay. Agreements will be incomplete when there are still further terms and conditions to be agreed. Agreements in principle will not usually be upheld in court and will not usually be considered complete verbal agreements.

Verbal Agreements and Disputes

If either party has decided to break a contract then the matter can be taken to the legal courts. In most cases the dispute may rest on the justification of the terms of the verbal agreement. There are a few ways that a judge will try and establish the terms of the agreement. These could include investigating what actually happened in practice. This can include the services that were actually undertaken and if any money whatsoever was paid for any services.

Enforcing a Verbal Agreement

Apart from taking the matter to court there are other ways to enforce a verbal agreement. If money is owed then the matter can be passed on to a collection agency to try to enforce the matter for you. The disgruntled party can also apply pressure themselves by sending letter, emails and making telephone calls to the person who is in breach of contract. Copies of all emails and letters should be kept in case the matter does reach the law courts.

Payment before Service

One way of avoiding this sort of dispute ever occurring may be to ask for some form of payment before supplying a service. Although the customer may not always agree to this it may be an option to consider. In some cases if a person is going to breach a contract and withhold payment then the odds are they may never have intended to pay for the service in the first place. In many cases though a customer may not like the idea of paying for a service until the job is completed for fear of non completion.

Threatening court action for breach of a verbal contract may not actually help the matter at all if one party intended not to carry through on the agreement. However the law does consider complete verbal agreements as Legally Binding and the matter can be brought to the law courts for a judge to make the final decision.

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I am somewhat confused by this article. If verbal contracts are legally binding, how is it that if, say, a masseuse, therapist, personal trainer, etc, makes a verbal contract for a session with a client, also clearly stating their cancellation policy, and that session was booked over the phone, then the client CAN cancel the appointment last minute, or simply not turn up, completely ignoring the cancellation policy (even if it were in writing).This is, apparently, the law in England because any service that is offered and booked *not on premises* is entitled to a 14 day "cooling off period" regardless of subsequent oral/verbal or written "cancellation fee" for missed or abandoned appointments. At least that's what the Citizen's Advice Bureau are telling me. I would be very interested to hear your view on this.
ConfusedOnContracts - 28-Apr-16 @ 11:36 AM
Hi, I went in for a dental check up and I was advised to go to the hygienist to get a thorough clean before having a tooth removed. The hygienist only works Tuesdays and as I was paying for my check up, I was advised that in order to make an appointment with the hygienist I would have to pay up front. Due to the Hygienist being ill on the Tuesday set, they rearranged the appointment meaning I had to rearrange things with work. In the mean time I had another appointment cancelled by them for the tooth removal and that had to be moved too. I went today for the hygienist and set off well before my appointment, but due to traffic I was unable to make it in time. My girlfriend rang up on my behalf, as I did not have the number, to let them know I was going to be late, but by the time I got in to town, I was well over the grace period, so I had my girlfriend call them again to try to rearrange the appointment. She was told that I would loose my "deposit" as they referred to it and if I re booked I would have to pay again. At no point when I was paying in the first place was I told that if I couldn't attend for what ever reason I would forfeit the money I have paid. Should I have been told this as part of the verbal contract? or are they able to assume that it is implied and that I should understand that that is a condition of me paying up front? Thanks.
Worboys - 26-Apr-16 @ 9:30 PM
Hi, I went in for a dental check up and I was advised to go to the hygienist to get a thorough clean before having a tooth removed. The hygienist only works Tuesdays and as I was paying for my check up, I was advised that in order to make an appointment with the hygienist I would have to pay up front. Due to the Hygienist being ill on the Tuesday set, they rearranged the appointment meaning I had to rearrange things with work. In the mean time I had another appointment cancelled by them for the tooth removal and that had to be moved too. I went today for the hygienist and set off well before my appointment, but due to traffic I was unable to make it in time. My girlfriend rang up on my behalf, as I did not have the number, to let them know I was going to be late, but by the time I got in to town, I was well over the grace period, so I had my girlfriend call them again to try to rearrange the appointment. She was told that I would loose my "deposit" as they referred to it and if I re booked I would have to pay again. At no point when I was paying in the first place was I told that if I couldn't attend for what ever reason I would forfeit the money I have paid. Should I have been told this as part of the verbal contract? or are they able to assume that it is implied and that I should understand that that is a condition of me paying up front? Thanks.
Worboys - 26-Apr-16 @ 8:32 PM
I asked a friend to assist me do my school project work. Six months after completion of the project work, we had some misunderstandings which, in the actual sense, does not relate to the project work. He later sued me at court for entering into a verbal agreement of paying a sum of USD 2,000.00 to him in relation to my project work. This verbal agreement that he was talking about is never true. What possible defense do I have?
NK - 19-Apr-16 @ 6:08 PM
We had ordered a new kitchen for approximately £12000. Mid February 2016 we paied a deposit of £500. The company sent confirmation of order 23 February. On the 9 Match having considered the cost we decided to cancel the order and sent a letter to confirm cancellation. There was no response so we sent a recorded delivery copy of the letter on 24 Match. The company replied on the 2 April saying we still need to pay £580 for costs incurred, should we pay this as they are threatening legal action. In my opinion the money paid to date should cover the costs. Any advice on how to answer this demand.
wolf - 7-Apr-16 @ 9:54 PM
I am currently living in Dubai and I have been informed by the HR manager of a UK University in Dubai that I have been chosen to fill in the role that I have applied for. I was informed over the phone and during our conversation the HR manager has also informed me that before she can send my contract the Chairman would need to approved it first. The HR manager went for a vacation and her assistant cannot follow-up with the chairman. My question is, can I take legal action should they decide not to approve my contract? It has been three weeks now since I have been informed that I have been chosen to fill in the position. I do regularly follow-up with the assistant who by the way refuses to follow-up on the status of my contract with the chairman.
rinna - 7-Apr-16 @ 9:45 AM
I attended my local catalogue store today 01/04/2016 to complain about a delivery of a replacement wardrobe that failed to arrive on the time and date specified by the store manager. The assistant manager checked, and no delivery had been arranged by the manager. I agreed to accept another delivery date and as a gesture goodwill a ten pound voucher was offered to me. I intended to purchase some sports equipment on a buy one get one half price basis, however, only one item was in stock. I asked the sales assistant to contact the assistant manager as I had experienced the same inconvenience the week before. When the assistant manager arrived the sales assistant explained it was buy one and get the other half price, but I would have return to the store the following day. I expressed my dissatisfaction and the assistant manger clearly stated I could have the half price one for"Free" no misinterpretation. I even shook the hand of the assistant manager before he walked off. The sales assistant asked for payment, which included the "Free" item and was unwilling to commit herself to complying with what had been agreed. I challenged her and she went back to speak with the assistant manger. The sales assistant returned and said when I return to the store the following day ask for the assistant manager. My fear is he will renege on the verbal contract agreed by acting disingenuous but there was a witness, the sales assistant. Undoubtably the CCTV camera overlooking the cashier will confirm a handshake took place. Is this a verbal contract within law?
Taff116 - 1-Apr-16 @ 2:22 PM
In terms of case law what are the elements required to form a legally binding contract. In reference to the concepts of agreement, consideration and the intention to create legal relations? Thanks
Dave - 31-Mar-16 @ 2:33 PM
this is basically my fault , having owned my own business i know better but life hasent been all that easy never the less this is what is going on ,threw a a friend we both know he asked if i wanted to work with him ,he said he pays $10.00 per hour, that's fine because my body is not in great shape after a few accidents in the past ,my main thought was i'll make a little money and get outof the house an some exercise ,he'd pay a little bit each week but then money became far and inbetween,what i did was keept writen records of hours on the job ,what we did plus countless hours of wasted time,after approx 5-6 mounths i was fed up , i showed him my records went over all of it and left,i made phone calls and text messages everyweek about 1 1/2 mounths he gave me $400,00,then nothing till aboutlittle over a nounth he gave me $300.00,i called agin 2 weeks ago and he's reply was your asking the wrong dude ,,total was $3,600 ,i put total now at $2,000.00 ,was nice and took off for him buying me lunches some tools he'd givien me and few other odds and ends ,anyhow i put the total at $1,300.00 ,i know what an idiot i m ,i do have me reasons ,thank's for listening and that's where i'm at ,thanks agin
steve - 29-Mar-16 @ 8:27 PM
I have an employee who is asking for loss on the sale of his home to relocate per the company's request. We are obliged to provide him some monetary relief but I need to draft a binding agreement that states we shall pay this?? but he must remain in the employ of our company for ?? years. Is this possible and what would the wording be if we decided to terminate his employ before the end of the 2 years.
Toby - 29-Mar-16 @ 7:40 PM
A few months ago my ex employer offered to send me and a few other people to California to work in a new office. We talked about the terms in his office. The deal was that we went to California and he would take care of the rent that we were paying in the apartment. I left in August. A week ago I got a call saying I owed almost 3k for the apartment. My other roommates are unwilling to help me cover for it, and my ex-employer told me "Im not paying for your F*** up's". I have another 3 people that were in the office when the terms were being stated. Do I have a good chance of winning in court? I might have messages and group chats that also say that he was going to pay for the apartment.
T.haze - 28-Mar-16 @ 1:55 PM
How long is a verbal agreement valid for?I made a verbal agreement with someone for $60k he said that if we get all the things together to start what was to be done that we would get the full amount. He gave us $4k we got everything done in 10 months when it came to the point to collect the other $56K he said no that we weren't getting anything else. I told him that since he made a verbal agreement that that is a binding contract. He said no judge would believe us and that we have to prove that he said that in court. His daughter and wife were the other people that were there when he said that and his daughter is the one that has sent him a demand letter. Now he says that if we take this to court that he would counter sue us for something that he promised. We have a lawyer but I want to know what the limit is and does he have a right to counter sue us because of a promise that he has made?
Curious owner - 26-Mar-16 @ 8:08 AM
Dan- Your Question:
I would like to know if my Verbal Contract is liable in a court of law. I received a text message from an employer stating that they need my labour at £70 a day plus transport for removing carpets at hotels through an independent company which I agreed upon. however my emplyoer is now on the Fence saying £50 a day plus travel at the end of the Job will I be able to claim my original wage and am I eligible to sue the company if this agreement is not met? Kind regards Daniel

Our Response:
There is no right answer to this, as it may be that after the first offer, your employer discovered there was less work that originally anticipated. If the difference is only £20, it is certainly not worth taking the matter further. I would either ask for the reason why he has reduced the payment from the original offer, and if you still think it is unfair try and re-negotiate the terms.
ContractsAndAgreements - 24-Mar-16 @ 2:09 PM
I would like to know if my Verbal Contract is liable in a court of law. I received a text message from an employer stating that they need my labour at £70 a day plus transport for removing carpets at hotels through an independent company which I agreed upon. however my emplyoer is now on the Fence saying £50 a day plus travel at the end of the Job will I be able to claim my original wage and am I eligible to sue the company if this agreement is not met? Kind regards Daniel Davies
Dan - 23-Mar-16 @ 9:42 PM
I got into a verbal contract, with my employer, over a car. I work 49 hours a week, I get paid for 40 of them. The nine hours (straight pay) was going towards my "car payment". I have it written down as such. And every week, I would document how many hours were going towards the car payment. I was given a price of $4500.00, and I paid $4700.00+. She has decided now, that the car is her dad's, and she couldn't sell it, and she wants it back, and I will NOT be getting any compensation for it at all. She has turned everything around that she gave me a $4500.00 cash price, but I couldn't afford it, and she still continued to take all of my over time. Are there any grounds that I could take her to court, to either, get the car signed over to me, or get my money back, at least half?
mom - 23-Mar-16 @ 7:55 PM
debs - Your Question:
Hi. My husband and I separated 9 yrs ago. We have 2 children and have always maintained a very amicable relationship. When we separated we remortgaged the house and he took £30,000 out of the equity in order to put a deposit down on a new flat. We agreed that that was me buying him out and that he would have no further claim on anything to do with our house , financially. His words were " I have taken all that I want from the house, it's yours now ". the £30,000 represented 50% of the estimated equity in the property. I have maintained the property 100% on my own, I have updated and landscaped the garden, adding value to the house. Due to my low income his name has remained on the mortgage, as I do not earn enough to be the sole mortgagee. Whilst this may have caused me ex inconvenience at times, it has not prevented him from getting finance subsequently. In a recent conversation about Wills and my wishes for the estate , he indicated that , despite accepting that he had paid nothing into the house for 9 years , that he feels that, should I ever sell the house, that he should reap some of the profit from the equity as it stands now. This has really unnerved me as I'd been safe , n the knowledge that the house was MINE. IF he did decide to go for a portion of my equity , would I have a valid case with regards to our verbal contract that was made when we split? Thanks for any advice

Our Response:
In this case you would have to seek legal advice. Should the matter go to court, then the court would take your claims into consideration. However, if he is still paying towards his share of the mortage, then he may have a case. It's difficult to be able to advise without knowing the full details and you say he hasn't paid into the house for nine years, yet you also say you do not earn enough to be the sole mortgagee, so is he still contributing? It will help you if you can do your best to prove this was a cut and dry financial agreement and he hasn't contributed since you made the equity split.
ContractsAndAgreements - 22-Mar-16 @ 10:44 AM
Hi, I entered in toA JOINT application for 125,000 funding with a landlord.it took three years and without exaggerating I did everything, the applications, the planning, the drawings, business plans everything.the landlord was awarded 125,000 for my business, for my jobs, my outputs, my business. 6 months later he told us he did not want it and had given it back.then because of a fraud investigation in to another farmer, and a parliamentary invegiation in to defra that after three years fully upheld my complaint.we met secretary of state at parliament.during that meeting I found out the landlord had never given it back but kept it.he was made to hand it back.it goes without saying we then lost our business and home. it was a group of farmers, an agent all lieing to obtain millions.covered up by defra. can I sue over breach of agreement/contract.I can prove my envolvement. thanks steveeasy
steveeasy - 21-Mar-16 @ 10:56 PM
Hi, I moved into a two-bed rented flat in December where the other tenant had lived for the past 2 years which she had part-furnished. Before signing the contract (we have separate tenancy agreements) which stated rent was £350 I phoned the other tenant to ask about the remaining £200 that she said was to be paid towards bills as this seemed fairly substantial for a small two-bed flat. She reassured me that after each quarter she would get a balance on everything paid in and paid out and reimburse me any overpayments. She also assured me when I moved in that she had given updated meter readings and put my name on the council tax. I've since realised she hadn't done either, and in fact had the usual two month payment break in council tax despite me continuing to pay the £200 (she told me there was an error in our bill so we weren't getting the payment break). She told me internet payments were more than the one bill she's managed to show me and has invented a £30 charge per month to pay towards her furniture. So basically she's trying to keep as much of the £800 I've given her to date and I'm wondering whether it's worth taking her to the small claims court? She's said she's moving out at the end of the month because her tenancy agreement was 4 weekly rolling compared to mine which was 6 months. She wants me to change the bills into my name but i think what she's planning to do is to just stay with her boyfriend and leave her furniture there at mine but not pay any bills except her rent (the landlady is very much on her side and I presume this would suit her better as she'd continue to get her rent for the next two months). I feel totally shafted for being naive and taking her word in good faith but she seemed like a really decent person and I'd no reason the believe otherwise.
AC - 21-Mar-16 @ 8:49 PM
Hi . My husband and I separated 9 yrs ago . We have2 children and have always maintained a veryamicable relationship.When we separated we remortgaged the house and he took £30,000 out of the equity in order to put a deposit down on a new flat. We agreed thatthat was me buying him out and that he would haveno furtherclaim on anything to do with ourhouse , financially. His words were" I havetaken all that i want from the house,it's yours now " . the £30,000 represented 50% of the estimated equity in the property.I havemaintained the property100% on my own, I have updated and landscaped the garden,adding value to the house. Due to my low income his name has remained on the mortgage, as I do not earn enough to be the sole mortgagee.Whilst this may have caused me ex inconvenienceat times,it has not prevented him fromgettingfinance subsequently. In a recentconversationaboutWills and my wishes for the estate , he indicated that, despite accepting that he had paid nothing into the house for 9 years , that he feels that,should I ever sell the house, that he shouldreap someof the profit fromtheequity as it stands now . This has reallyunnervedme as I'd beensafe , n the knowledge that the house was MINE. IF he did decide to go for a portion of my equity ,would I havea valid case with regards to our verbalcontract that was made when we split? . Thanks for any advice
debs - 21-Mar-16 @ 12:00 AM
Me60x - Your Question:
Hi for over 40 years I was told in writing that if I paid my taxes/insurance to the government then I could retire at 60. They decided to change the rules without discussion with me or writing to me. Now I am told that I will not get any of the money I have paid in! Surely I have a case to sue the government over breaking a contract?I am now 60 and I calculate that they are withholding over £34k from me.if this was a private company there would be a case to sue. Why not the government?

Our Response:
Please see link here . You're not the only one who feels the same way. It says: 'State Pension age changes were first made in 1995. All women affected have been directly contacted following the changes. There are no plans to alter State Pension age arrangements for this group.' You can read the full summary on the page.
ContractsAndAgreements - 18-Mar-16 @ 12:55 PM
Hi for over 40 years I was told in writing that if I paid my taxes/insurance to the government then I could retire at 60. They decided to change the rules without discussion with me or writing to me. Now I am told that I will not get any of the money I have paid in!Surely I have a case to sue the government over breaking a contract? I am now 60 and I calculate that they are withholding over £34k from me......if this was a private company there would be a case to sue. Why not the government?
Me60x - 17-Mar-16 @ 5:31 PM
Jim - Your Question:
I have an old hospital bill I was unable to pay and I was sued in court over it and of course a judgement was entered against me for that amount. I received a letter from the attorneys office asking if I wanted to settle so I called and made a verbal agreement over the phone of $50.00 a month. The agreement was they would send me a "written agreement" with info on where and when to send the payments. I never received a written agreement from them and then 4 or 5 months later they file a garnishment against me wanting 25% of my income. I filed for an exemption, they filed an exception to my exemption and I have a court date in about a month. I tried calling the attorneys office again (who is an out of town attorney) to try to get the original agreement and let them know I never received a written agreement in the mail like they said and bottom line they don't care and want to garnish my wages.My question is since the "verbal agreement" was not honored as they said it would be can I ask the court to enforce the original verbal agreement?

Our Response:
Unfortunately, we cannot answer this as we are a UK-based website with knowledge of only UK-based law.
ContractsAndAgreements - 9-Mar-16 @ 10:55 AM
DW - Your Question:
I went for an interview with Park Homes for a receptionist and at the end of the interview I was verbally offered and accepted the job, after nearly a week the manager of the park then told me he was sorry but could not let me have the job anymore because I had some relatives on the site and I may do them favours? Not only have I lost an alternative opportunaty in the mean time they have insuated I would typically be corrupt in the role?Is this legal or can I go higher and have that decision over rulled

Our Response:
Please see WorkSmart link here. I suggest you give ACAS a call regarding this and the company's reasoning behind it, in order to find out your rights.
ContractsAndAgreements - 8-Mar-16 @ 11:46 AM
I have an old hospital bill I was unable to pay and I was sued in court over it and of course a judgement was entered against me for that amount. I received a letter from the attorneys office asking if I wanted to settle so I called and made a verbal agreement over the phone of $50.00 a month. The agreement was they would send me a "written agreement" with info on where and when to send the payments. I never received a written agreement from them and then 4 or 5 months later they file a garnishment against me wanting 25% of my income. I filed for an exemption, they filed an exception to my exemption and I have a court date in about a month. I tried calling the attorneys office again (who is an out of town attorney) to try to get the original agreement and let them know I never received a written agreement in the mail like they said and bottom line they don't care and want to garnish my wages. My question is since the "verbal agreement" was not honored as they said it would be can I ask the court to enforce the original verbal agreement?
Jim - 8-Mar-16 @ 4:04 AM
I have a verbal contract at work the agreement in the interview was that I would be doing part time until another girl left then I would go up to full time now my manager is trying to say that I'm not contract to thr which is full time I'm now on wher contract which he is trying to lower yet again and as far as head office is concern I'm not contracted to anything what can i do
Suzy - 7-Mar-16 @ 3:56 PM
I went for an interview with Park Homes for a receptionist and at the end of the interview I was verbally offered and accepted the job, after nearly a week the manager of the park then told me he was sorry but could not let me have the job anymore because I had some relatives on the site and I may do them favours? Not only have I lost an alternative opportunaty in the mean time they have insuated I would typically be corrupt in the role? Is this legal or can I go higher and have that decision over rulled
DW - 7-Mar-16 @ 1:31 PM
marino - Your Question:
Hi, when I started my job I was told at my interview hours of work were 8.45am to 4.45pm with a 4oclock finish on a Friday. Flexible working hours are available from 7.00am to 7.30pm. Core time is 10am to 12.00noon and 2.30pm to 4pm. I have stopped at 4pm on a Friday for 20 years. We have a new manager and wants me to stay til 5pm? Can he enforce this?

Our Response:
If your contract limits your working hours/days (for example from 9am to 5pm), unless there is a clause in your contract saying your employer has the right to change your hours, your employer cannot force you to change. However, any requested changes should be discussed between you, in order to reach an agreement.
ContractsAndAgreements - 7-Mar-16 @ 10:34 AM
Hi, when I started my job I was told at my interview hours of work were 8.45am to 4.45pm with a 4oclock finish on a Friday. Flexible working hours are available from 7.00am to 7.30pm. Core time is 10am to 12.00noon and 2.30pm to 4pm. I have stopped at 4pm on a Friday for 20 years. We have a new manager and wants me to stay til 5pm? Can he enforce this?
marino - 4-Mar-16 @ 7:22 AM
Lilythegenie - Your Question:
Hi,My ex partner and I signed a document that we formulated together when I found out that after 4 years of living together he was married. This was devastating to say the least. My ex partner was the breadwinner in the relationship and due to the fear of his wife finding out stated in the contract that he would pay me an amount of money until I found employment. Now he has breached this agreement by completely ignoring me and threatening me. How can I go about with this? The clause in the agreement states that if he breaches I must immediately get in touch with his wife and tell her about us. Help!

Our Response:
I am sorry to hear this, but there really is no way you can make this contract stand up as it is effectively blackmail on your part.
ContractsAndAgreements - 1-Mar-16 @ 12:15 PM
Hi, My ex partner and I signed a document that we formulated together when I found out that after 4 years of living together he was married. This was devastating to say the least. My ex partner was the breadwinner in the relationship and due to the fear of his wife finding out stated in the contract that he would pay me an amount of money until I found employment. Now he has breached this agreement by completely ignoring me and threatening me. How can I go about with this? The clause in the agreement states that if he breaches I must immediately get in touch with his wife and tell her about us. Help!
Lilythegenie - 29-Feb-16 @ 2:15 PM
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