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The Law & Verbal Agreements

By: Garry Crystal - Updated: 12 Feb 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 was wondering if some one on here could give me some advice?This all started 5 years ago when my brother in-law bought my father in-laws house for fraction of the price that he would of got if he had sold it on the market, this was done on the understanding that when my brother in-law sold the house, he would give his brother his inheritance of £30,000.Now this all started 5 years ago, and told every one that he would do this, but so far he has come up with every single excuse you could imagine, i.e. oh we have had another baby, oh we had to do this or do that" Apparently he has now said that he went and saw a Financial Advisor and he is now saying that they have told him that they are locked into their current mortgage until 2018 and that it could cost upto £6000 to get out of it.Now what I would like to know, is if there is any thing we can do as this was a verbal agreement between my husband, my father in-law and my brother in-law.Many thanks in advance.
Chan - 12-Feb-16 @ 5:16 PM
I recently gained employment in a very illustrious engineering company and in September last year, after my 6 months trial period, I was asked to become a permanent member of staff. My manager and I discussed payment and after our discussion my manager offered me 19000 a year for the first year knowing this was less than I was looking for he insisted I would get a wage increase at the start of the new year. I got my contract sent through the post and was very annoyed to find my contract was for only 16000! I immediately informed my manager who told me it was out of his hands and that I would be up for a wage rise come January. it is now January and I have received a poxy 2% wage rise with no chance of another one this year apparently. did my manager and I have a binding contract? is there anything I can do? please help.
jim - 20-Jan-16 @ 1:56 PM
Tuppence - Your Question:
We sold a house which was down valued by £5,000. The buyers asked if they could pay us privately 6 million the after exchanging contracts. We agreed to this interest free. However their mortgage lender did not want this agreement on their contract, so I. Order for the sale to proceed, we had to do our own private agreement based trust and documented conversations , emails etc. all parties inc estate agent, both solicitors were aware this was the case in order for the sale to proceed. I was advised if they did not keep their agreement and pay the money , we would have to go to small claims court. Will my Facebook messenger conversation , which included proof of our discussions, and what the buyers agreed to, stand up in court. I am in the process of filing in the forms at the moment and have a stack of paperwork to back up my version of what we agreed.

Our Response:
Facebook is probably not the most relaible way to conduct such a business transaction. I do not know whether the court would accept this, as anyone can set up a Facebook page. However, if you are filing the forms then you can present this information as it may help your case, more so if you could prove the Facebook page was owned by the buyer. Email would have been a more reliable form, even texts can be used as evidence.
ContractsAndAgreements - 20-Jan-16 @ 12:42 PM
Re above, sorry, typing error , should have said they agreed to pay the money in 6 months, not million!!!!
Tuppence - 19-Jan-16 @ 4:16 PM
We sold a house which was down valued by £5,000. The buyers asked if they could pay us privately 6 million the after exchanging contracts. We agreed to this interest free. However their mortgage lender did not want this agreement on their contract, so I. Order for the sale to proceed, we had to do our own private agreement based trust and documented conversations , emails etc. all parties inc estate agent, both solicitors were aware this was the case in order for the sale to proceed. I was advised if they did not keep their agreement and pay the money , we would have to go to small claims court. Will my Facebook messenger conversation , which included proof of our discussions, and what the buyers agreed to, stand up in court. I am in the process of filing in the forms at the moment and have a stack of paperwork to back up my version of what we agreed.
Tuppence - 19-Jan-16 @ 4:13 PM
Myself and business partner looked at a restaurant for lease. We agreed on rent and deposit .the property was advertised as ready to go so we had to wait for it to be deep cleaned, equipment tested And contents listed which from start to finish has taken 2 months. After looking at the premises again and being happy with all that was done the owner has now said he's not leasing. Can we do anything
Kath - 12-Jan-16 @ 10:58 AM
I am a Gas safe Engineer and have to "buy" jobs from a well known online agency bringing tradesmen and customers together. There are a lot of timewasters out there, I buy a job and one cannot contact the poster after buying the job or as has just happened (again) the customer procrastinates. One is not given the door number just post code. After contacting the customer we agreed a visit next morning and he gave me the door number. 10 mins later I receive a text which asked me to call when on route "to arrange a time"...??? I actuallt skimmed and missed the last bit. On arrival the next day the cars were on the drive but received no answer. Then a text appeared informing me not to come as he was in work. He has no intention of having thre eork done. Was there a "contract" and can I take steps to recover my costs?
Blooflame - 11-Jan-16 @ 10:04 AM
Got a builder to give us a quotes for a loft extension in sept - he drew up proposed layouts (6 in total) and then I paid for a set of drawings £850 (no commitment to build of us him).Delayed the build after the drawings indicated that to get what we wanted, we would need additional funds - he was pushing us to compromise or design or increase our budget.We emailed to say that we couldn't progress at this time but could we do something for April.He sorted out certificate of lawfulness, plus a pre planning application. We have since found a cheaper builder who can do the job now.Other builder is not happy because he has lost the job, he now wants to charge us for work lost and the "extra work" he has done. Can he do this?He says he has a agreement with us, and is referencing "goodwill".
Trainspotter - 6-Jan-16 @ 8:43 PM
I recently agreed to purchase a piece of land off the owner for £20,000 on the condition that I paid for for all the costs incurred including planning permission and architect fees.Now that planning permission has been granted he is saying that he wants to put it with an estate agent to get full market value.I identified the potential of the site and approached him to see if he was interested in my proposal of which he confirmed verbally and by text. After six months of my time and expensive architects fees , what is my legal position.
fis - 2-Jan-16 @ 12:00 PM
Me and my family went on vacation. This was done through a travel agency, as we have used their services before, we did not have a contract written. First the travel agency moved our flight date 3 days later than agreeded, they only informed us about this 4 pm the day before we were meant to leave. We agreeded that we wanted a refund of our money if Friday was not possible, after negotiations, the manager said that they would place us in a four star hotel and made other promises to reimburse us. As we did not want to disappoint our children, we agreed to this, however once we arrived, they did not go through with their promises. The manager has not picked up our calls, there is a third party that has spoken to us, claiming that the manager made no such promises and it was a staff fault. We already paid for the trip fully, the hotel we are at does not meet a four star hotel standard. It could also be considered a health harazard for my children. We are currently at the hotel, unable to move since we already paid for our accommodation. What can we do/ what action can we take against them?What rights do we have?
Chad - 24-Dec-15 @ 7:10 PM
What are my rights as a purchaser when an online seller changes the price of a product that I am about to purchase, and review it upwards the moment I hit the confirm button by means ofa pop up which appears apologizing for a typographical error in the previous price?
Heavy B - 23-Dec-15 @ 9:05 PM
nina18 - Your Question:
Hi, early this year my neighbour started to build a house next to me and asked if I can supply him with water as I had an outside tap. In return he promised to pay the whole bill. He didn't though. What can I do?Regards

Our Response:
I can only suggest you broach the subject with your neighbour directly. If you are on a meter and you have used way above your normal amount because of your neighbour helping himself, then you should re-iterate your normal cost and the amount extra due to his usage. If you are not on a meter and on a normal monthly/quarterly bill, then his usage of water will not make much difference, so you might prefer to drop the issue and maintain good relations given the extra water usage is essentially free. However, if it is on a meter and this is an issue for you, then you may be able to take it to the small claims court. It depends upon the amount used, the period of time he used it for and whether it is worth the strains in the neighbourly relationship it would cause.
ContractsAndAgreements - 23-Dec-15 @ 2:33 PM
Hi, early this year my neighbour started to build a house next to me and asked if I can supply him with water as I had an outside tap. In return he promised to pay the whole bill. He didn't though. What can I do? Regards
nina18 - 23-Dec-15 @ 9:45 AM
I had a mate live with me since April so we only had a verbal agreement. On 10th of November he informed me that he was 'thinking' of moving out but never gave me a date. On 15th of December he suddenly tells me that he's moving out at the weekend (18th) so only four days notice. It's near impossible to get someone move in before Christmas. He was due to pay a months rent on 20th so now I'm out of pocket a months rent. I got statements showin direct debits which he paid the rent with. I've also got the texts proving no actual notice was given. He's refusing to pay me anything stating he gave me notice which clearly he hasn't. Is this something I can take to a small claims court?
Talling - 19-Dec-15 @ 7:02 PM
I didn't want to move out of my house until I was able to but a home. My sister moved out of her home and before I moved in I asked her landlord would I be able to buy the house when I'm ready? No more than 4 months. He said yes. I asked well what happens if it doesn't appraised at $55k he was asking? He said that he'll work with me on it. It appraised at only $39k. He told my mortgage lender that wasn't happening and he wasn't letting me out of my lease. I tried to make a deal with him and offer $7k on top of the $39k from mortgage lender. I called or texted him a few times about this. Especially because I had already started to withdraw my 401k money. He said he'd talk to his accountant. But he never replied back to me. So now I'm about to move and break the lease because renting was something I did not want to do ever again and I found another home. Will he able to take me to court and get money for the rest of the lease? Do I have a case as well?
Trina - 18-Dec-15 @ 8:54 AM
Marty - Your Question:
We recently found out that the father of the 16 year old my partner gave birth too has stopped paying his child maintenance and not informed to us the reason why or when he stopped, Now he owes us in access of 500 pounds back dated Child maintenance. His daughter is still in full time education doing B-Tec course in sixth form We only ever agreed terms over a verbal contract. I have proof he used to pay 40 pound per week to our bank account and now it has stopped so where do I stand with reclaiming the child maintenance he owes?

Our Response:
Every parent has the basic responsibility to provide for their child up until the age of 16, when they are legally allowed to leave school and get a job. After this age, it depends what your child chooses to do. If they continue in full-time non-advanced education , not higher than A-level equivalent, for at least 12 hours a week, then maintenance payments will continue until your child finishes or until they turn 20. It may be your ex automatically thinks payments stop at age 16, therefore you may wish to get in touch with him and tell him his payments should continue. You could also approach the CMS and claim this way, see link here. Unfortunately, you can only claim back-dated payments from the date you make the CMS claim. If you wanted to claim back-dated payments from your ex on the back of a family-based arrangement, you may have to take it to court. However, if you don't know the reason why he has stopped paying, i.e redundancy, lost job etc, if you take it to court and he has a genuine reason for not paying, it may end up costing you.
ContractsAndAgreements - 17-Dec-15 @ 12:43 PM
Shark! - Your Question:
On Friday I was contacted by a well known telephone and broadband supplier and was told that before I can have fibre services, I would have to agree to pay contractors fees which came to just under £500. After thinking time, I contacted the company via email and voice to confirm that I would agree to the costs. Shortly after this, the company called me back with an install date in January 2016. On Monday, I was called by the company to say that they could not do the install until I paid over £1,000. I was shocked and said that I could not pay that amount and that we had already agreed a price and date. They are now saying that they will cancel the order if I do not agree to the new charges. I am almost certain that they are acting illegally can you confirm if this is "in essence" correct?

Our Response:
Most broadband providers do not ask for money upfront, so please beware of paying anything before your broadband is installed. To verify this is the correct company and not a scam, I would give the broadband provider a call directly. However, do 'not' call from any number the cold-caller provided you with, but call the customer service number obtained from the provider's legitimate website. The provider will then be able to look into whether you have been contacted or not and whether this is their terms or not. If they are not, then you will need to report this scam.
ContractsAndAgreements - 17-Dec-15 @ 11:28 AM
Hi my dad has had a verbal contract with some one he was building a garage for and he recently fell off and had loads of injury sbleed in the brain fractured skull he is now on sick and is unable to walk never mind work and the person he was doing the job for is now taking him to court demanding a full refund can this be done or not and my dad cannot afford a solicitor as he has no money so be will be representing his self in court and advice reall appreciated
Chelc - 16-Dec-15 @ 6:16 PM
We recently found out that the father of the 16 year old my partner gave birth too has stopped paying his child maintenance and not informed to us the reason why or when he stopped, Now he owes us in access of 500 pounds back dated Child maintenance. His daughter is still in full time education doing B-Tec course in sixth form We only ever agreed terms over a verbal contract. I have proof he used to pay 40 pound per week to our bank account and now it has stopped so where do I stand with reclaiming the child maintenance he owes?
Marty - 16-Dec-15 @ 4:25 PM
On Friday I was contacted by a well known telephone and broadband supplier and was told that before I can have fibre services, I would have to agree to pay contractors fees which came to just under £500. After thinking time, I contacted the company via email and voice to confirm that I would agree to the costs. Shortly after this, the company called me back with an install date in January 2016. On Monday, I was called by the company to say that they could not do the install until I paid over £1,000. I was shocked and said that I could not pay that amount and that we had already agreed a price and date. They are now saying that they will cancel the order if I do not agree to the new charges. I am almost certain that they are acting illegally can you confirm if this is "in essence" correct?
Shark! - 16-Dec-15 @ 2:33 PM
I recently signed a commercial renewal of tenancy lease. During our pre signing conversations he agreed not to increase the rent. I then duly signed but it has come to my attention after the fact that he has increased rent from next year. What can i do?
Electrical - 16-Dec-15 @ 10:48 AM
Hi there, and thanks for making this great resource site available. I provide marketing services for small businesses. I have worked fro 1 particular client for 2 years now, working 8-15 days each month, largely from their offices. About 18 months ago, the MD of the client offered me a performance bonus, which I turned down. I said that instead I wanted a degree of security in our working arrangement as we had no contract and I rarely received feedback. He said that if the time came when they no longer wished to retain my services, I would receive 2 months notice on the basis of 8 days per month. I am now hearing rumours that my services will be dispensed with next month, and whilst I am confident our verbal contract is binding, I would like to understand how best to achieve the agreed terms amicably.
MK - 15-Dec-15 @ 12:59 PM
Flo - Your Question:
Our dog, who has never been involved in anything like this before, bit a lady, who is a few months pregnant, on the leg. My granddaughter was walking the dog in a park, the dog was on a lead. Granddaughter had a seizure and the dogs leash fell out of her hand. A couple was walking towards her. The dog became protective as did the man who started kicking and yelling. The dog then bit the woman, quite a substantial injury.The lady, who had no sick pay left, had to take a week off work and we agreed to pay her a weeks wages and medical expenses. Her husband chose to take time off work as well. We got another message from her asking for more money saying that she had to take another week off because of infection and intimating that taking the necessary antibiotics could potentially harm the baby. She also implied that it may take years before any consequences were known. She said that her husband had to take more time off work. She also keeps mentioning that she doesn't want anything for pain and suffering. The wording caused us concern so we got some legal advice which was that we were not required to give her anything. However we did feel some moral responsibility even though it was just an unfortunate accident beyond our control.Another text came from her saying that she would accept a further $2000 and she would write it off as a bad experience, and we would never hear from her again.We will negotiate that with documentation from her but want to word a document for her to sign saying that this is the end of the matter. What advice?

Our Response:
I'm afraid we cannot advise on this as we are a UK-based company, with knowledge of only UK-based law, the US may be a bit different. You would therefore have to seek legal advice, as it sounds like the woman is beginning to bribe you. At the same time, she would also be eligible to claim compensation, should she wish to take it to court. You don't say whether this was reported to the police either, as this should have happened at the time.
ContractsAndAgreements - 14-Dec-15 @ 12:05 PM
Our dog, who has never been involved in anything like this before, bit a lady, who is a few months pregnant, on the leg. My granddaughter was walking the dog in a park, the dog was on a lead. Granddaughter had a seizure and the dogs leash fell out of her hand. A couple was walking towards her. The dog became protective as did the man who started kicking and yelling. The dog then bit the woman, quite a substantial injury. The lady, who had no sick pay left, had to take a week off work and we agreed to pay her a weeks wages and medical expenses. Her husband chose to take time off work as well. We got another message from her asking for more money saying that she had to take another week off because of infection and intimating that taking the necessary antibiotics could potentially harm the baby. She also implied that it may take years before any consequences were known. She said that her husband had to take more time off work. She also keeps mentioning that she doesn't want anything for pain and suffering. The wording caused us concern so we got some legal advice which was that we were not required to give her anything. However we did feel some moral responsibility even though it was just an unfortunate accident beyond our control. Another text came from her saying that she would accept a further $2000 and she would write it off as a bad experience, and we would never hear from her again. We will negotiate that with documentation from her but want to word a document for her to sign saying that this is the end of the matter. What advice?
Flo - 12-Dec-15 @ 12:39 AM
I purchased a busniess through verbal agreement with witnesses for a indian takeaway and lease transfer now that the lease is basically done all he needs to do is sign but he is refusing to do so and for last 7months we have been running the takeaway paying the bills and everything the card machine is in my name so card payment money comes to my busniess bank account but the just eat and hungryhouse money goes into his bank account which he uses to gamble at casinos and we have told him many times hand over the money so we can purchase stock and pay bills but he does not so is there anything i can do legally?
Imran - 10-Dec-15 @ 2:01 PM
Mabs - Your Question:
Hi, can I please have some advise.I am in a shared ownership with my brother in the house we live in, we have purchased the house 10 years ago and we all still there. I am not on the mortgage, only him and his wife. I went in partnership on the basis of TRUST, I have payed half mortgage from the beginning upto now, I do not have all the proof of reciept, most of it was cash deposit into his bank, the last 2 years has been wire transfer with no reference, I have no proof of address either because all my Correspondenc address is at my business address. Now my brother and his wife have changed the mortgage lender and would not give me the new figures to carry on paying half the mortgage. Now I really don't know what to do, I went in with him all on trust and verbal. I have all my family members as witness and neighbours to confirm I was living there.Can anyone please give me some advise, thanks

Our Response:
I can only suggest you seek some legal advice here as this is a rather complicated set-up. There is little you can do if you have deposited cash into the agreement, also in defence they could say the money you gave was towards rent and it would be difficult for you to prove otherwise as you are not on the deeds or mortgage agreement.
ContractsAndAgreements - 10-Dec-15 @ 1:41 PM
Hi, can I please have some advise.. I am in a shared ownership with my brother in the house we live in, we have purchased the house 10 years ago and we all still there.I am not on the mortgage, only him and his wife.I went in partnership on the basis of TRUST, I have payed half mortgage from the beginning upto now, I do not have all the proof of reciept, most of it was cash deposit into his bank, the last 2 years has been wire transfer with no reference, I have no proof of address either because all my Correspondenc address is at my business address. Now my brother and his wife have changed the mortgage lender and would not give me the new figures to carry on paying half the mortgage.Now I really don't know what to do,I went in with him all on trust and verbal.I have all my family members as witness and neighbours to confirm I was living there. Can anyone please give me some advise, thanks
Mabs - 9-Dec-15 @ 9:08 PM
hi - i have a verbal agreement with a office water supplier. I wish to cancel, in the agreement that i have now received after being with them for 4 years, its states that i need to give 3 months notice. Thats not a problem but if you don't do it in the 12 month automatic renawal time you will have to complete another full 12 months?! Can i get out of this as they will not be at any loss by me ending the contract? Thanks!
nic - 8-Dec-15 @ 3:36 PM
vic - Your Question:
I rented a room to a board n he was given sum home verble agreement. 1 like there will be no vistors allowed n if he defaults he will be asked to leave da house immediately n all payment will forfeited which he defaulted n he moved out now they claming moeny part of da money back 0 take me 2 small claims court to sue me what should do

Our Response:
Your comment is a bit difficult to understand, but I'll do my best to answer it. As a landlord you can only withold the deposit for; damage to the property, missing items, cleaning costs and any unpaid rent - please see link here. I hope this answers your question.
ContractsAndAgreements - 7-Dec-15 @ 1:47 PM
I rented a room to a board n he was given sum home verble agreement. 1 like there will be no vistors allowedn if he defaults he will be asked to leave da house immediately n all payment will forfeited which he defaulted n he moved out now they claming moeny part of da money back 0 take me 2 small claims court to sue me what should do
vic - 6-Dec-15 @ 3:10 PM
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