Verbal Agreement Over: Going Beyond Handshakes
In business, it is common to encounter situations where agreements are made verbally rather than in writing. While this can be an expedient way to move forward with a project or deal, it also poses risks and potential issues.
A verbal agreement is an oral contract between two parties that outlines what each side promises to do. This type of agreement can take many forms, such as a handshake deal, a phone call, or a meeting where parties come to a consensus. However, despite its convenience, a verbal agreement can be challenging to uphold and enforce since it lacks the legal protections and documentation of a written contract.
Disputes can arise when one party misunderstands or forgets what was agreed upon, or when one party fails to hold up their end of the bargain. Without written proof of the agreement, it can be challenging to resolve the issue in a fair and just manner, and legal action may be necessary.
To avoid these potential problems, it’s essential to take steps to formalize verbal agreements whenever possible. One option is to memorialize the agreement in writing, such as sending an email or text message confirming the details discussed. This can provide a record of the agreement and help prevent misunderstandings or memory lapses.
Another approach is to use a letter of agreement, which is a less formalized document that outlines the basic points of the verbal agreement. This can be an excellent option when parties want to move forward quickly but also want to have some written protection in place. A letter of agreement can include essential details, such as the date and location of the agreement, the parties involved, and the specifics of the deal.
Finally, it’s always a good idea to consult with legal counsel when entering into any significant agreement, whether written or verbal. A lawyer can help you navigate the nuances of the deal, identify any challenges and potential pitfalls. They can also ensure that both parties understand the terms of the agreement and that everyone is on the same page.
In conclusion, verbal agreements can be an efficient way to move forward with business projects and deals, but it’s crucial to ensure that both parties understand and agree to the terms fully. Whenever possible, formalize the agreement in writing to provide legal protection in case of disputes. And don’t hesitate to consult with an experienced lawyer to ensure the agreement is sound and enforceable.