This may seem like a silly question to some people but often we hear statements to the contrary, such as “well, he cannot sue me because our agreement was not in writing.” So, the quick answer to this question is, yes, oral contracts can be enforceable in California! But of course there are always exceptions to the rule.
A contract is loosely defined as a promise or a series of promises between a set of parties for something to occur or not occur and is must be possible to fashion a remedy should one of the parties breach the contract by failing to perform. Of course, the subject matter of the contract and the promises made must be legal and not contrary to public policy. Notice that the loose definition of a contract does not include that it has to be in writing. So, generally, oral contracts are enforceable.
So why do we have written contracts? Well think about it. If two parties to a contract memorialize their understanding and agreement to a written document signed by both parties, the document and its contents represents the intent of both parties and what was to occur or not occur under the contract. Should one party breach the contract, it is easier to prove that the party breached the contract when you can point to a document. The breach of an oral contract between two people usually turns into a “he said, she said” argument in which nobody knows who to believe.
There is an exception to the rule that oral contracts are enforceable in California and is quickly found in a concept called the Statute of Frauds, which requires that certain contracts, such as those for the sale of real property, must be in writing to be enforceable. Because an in-depth discussion of the Statue of Frauds and other complex situations which will prevent enforcement of an oral contract are beyond the scope of the this blog, any person considering entering into a contract should contact the Chilina Law Firm or another California attorney who practices in business law and the law of contracts for further information.
Authored by Gregory J. Chilina and Co-Authored by Karen J. Chilina
Chilina Law Firm, a Professional Corporation, is a full-service estate planning, probate, trust administration, business law, and real property law firm that provides a wide-range of advising, transactional, and litigation services to its clients from its office located in Atascadero, California. The firm’s attorneys represent individuals and business entities in an assortment of transactional and litigation matters involving estate planning (including trusts, wills, powers of attorney, and medical directives), probate, trust administration, as well as general business law, contracts, corporate governance, land use, and real property. Chilina Law can be contacted by telephone at (805) 538-5038 or by email at info@chilinalaw.com or visit the Chilina Law Firm at www.chilinalaw.com. Chilina Law Firm is based in Atascadero, California and serves North San Luis Obispo County communities, including Santa Margarita, Atascadero, Templeton, Paso Robles, and San Miguel.
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