A contract is an agreement between parties that creates certain legal responsibilities. When a contract is formed, parties agree to do or not to do certain things. Generally, a contract can be formed by an oral agreement or by a written document. An oral contract is a spoken or verbally created agreement that can result in legally binding consequences. Some contracts have a specific writing requirement.
In general, to create a written or oral contract, there are certain legal requirements In general, there are five required elements to create any contract:
As a general rule, written contracts are easier to enforce. In fact, courts prefer that agreements be put into writing. With a written contract there is an actual document that shows what the parties agreed to. There are some agreements that must be put in writing in order to be valid and enforceable contracts.
An oral contract is only spoken. This means that there may be no witnesses to the agreement. Only the people or parties who made the oral agreement will know what was actually said. This can cause problems if the parties disagree about the contract at a later time.
The writing requirement under the statute of frauds is a rule that says that certain contracts must be put in writing. If the statute of frauds applies, there must be a written contract for the agreement to be enforceable. The purpose of the writing requirement under the statute of frauds is to prevent fraud. The statute of frauds ensures that certain types of important contracts are in written form. Written contracts are often more reliable. A written contract is a legal document and can be used as proof.
The statute of frauds says that certain types of contracts must be in writing to be enforceable. In most states, the following types of contracts must be in writing
Any of the above certain types of contracts must be in writing to be enforceable. These contracts should also include the following:
Not all contracts need to be put in writing. Many agreements do not involve the statute of frauds. Agreements that do not involve the types of subjects listed above are contracts that do not need to be in writing. Many agreements can be created by oral contracts. Oral contracts are often legally binding. There may be specific separate oral contract requirements and validity rules.
Most people and parties are legally allowed to write and enter into a contract. There are three major exceptions to this general rule.
Most people can legally write a contract. Even though there are not many rules about who can write a contract, drafting a contract can be complicated. Contract drafting and review requires planning and at least some understanding of contract law.The average person usually does not know contract law. Contract law can be extremely complex.
It is important to remember that even simple agreements may require very complicated writing. For this reason, it is highly recommended that you have an attorney write and/or review any contract before you sign it. You do not want to end up with legal obligations accidentally because a contract was written incorrectly.
It is also recommended that you put the contract in written form. Even if the statute of frauds does not apply, written contracts are generally easier to enforce than oral contracts. As discussed, the written contract will be proof of the agreement if there is ever a dispute in the future between the parties.
If the statute of frauds writing requirement applies, the parties must put the contract in a written document. Failure to follow the writing requirement can result in extremely bad consequences for all parties involved.
If the agreement does not follow the contract writing requirements, it may not be enforceable in court. In many cases, the court will decide that a contract does not exist. This means a court cannot resolve any disputes. If there is a disagreement, the parties may not be able use the legal system to solve the problem. This could be very bad for you, especially if, for example, you are owed money, etc.
In some states, it may be an option to ask the court to enforce an oral contract even though it should have been in writing under the statute of frauds rules. A court will do this in only limited and specific situations. Situations when a court might enforce an oral contract that does not comply with the statute of frauds include:
It is in your best interest to hire an experienced contract lawyer . A specialized attorney can advise you on contract writing requirements. A contract lawyer in your area can draft a contract for you and review any contract before you sign it.
Contract law and the statute of frauds can be complicated. A knowledgeable attorney can tell you what laws apply to your specific situation. If there is ever a dispute about the contract, a lawyer can also represent you in court.