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Joe Warkentin

Under a Verbal Agreement

Under a Verbal Agreement: What it Means and Why it Matters

Business deals and agreements are not always set in stone, and under certain circumstances, a verbal agreement can be just as binding as a written one. However, without proper documentation, it can be difficult to enforce or prove the terms of the agreement. Here’s what you need to know about being under a verbal agreement.

What is a Verbal Agreement?

A verbal agreement is a spoken promise or understanding between two or more parties. Typically, these agreements are made between people who know each other and have a level of trust. These agreements can be made in person, over the phone, or even via email or other electronic communication.

When Are Verbal Agreements Binding?

In most cases, verbal agreements are legal and binding, as long as they meet certain requirements. The terms of the agreement must be specific and clear, and there must be mutual understanding and acceptance of the terms by both parties. Additionally, there must be some form of consideration, such as money, goods, or services, exchanged between the parties.

However, without written documentation, it can be difficult to prove the terms of the agreement or the intention of the parties involved. This is where verbal agreements can become risky and potentially problematic.

Why Documentation is Key

Even if a verbal agreement is legally binding, it can be difficult to enforce or prove without proper documentation. In some cases, disputes can arise over the terms of the agreement, or one party may claim that the agreement was never made or was misunderstood.

To avoid potentially costly and time-consuming legal battles, it is recommended that all agreements, even verbal ones, be put in writing. This can ensure that all parties are on the same page and that the terms of the agreement are clear and unambiguous.

Additionally, having a written agreement can provide protection against misunderstandings, miscommunications, and even memory lapses. A written agreement can serve as a reference point if questions or disputes arise later on.

In conclusion, while verbal agreements can be legally binding, they can also be risky without proper documentation. It’s important to approach all agreements with care and be aware of the potential risks involved, especially when it comes to verbal agreements. If possible, always aim to create written agreements to ensure clarity and protection for all parties involved.

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