You probably take pride in your word as a businessperson. After all, sticking to your word can buy you a lot of trust and goodwill amongst your employees, your business partners, and your consumers. This is why a lot of times small businesses engage in transactions without written agreements. While that might work for a while, a legal dispute can arise when one person doesn’t make good on a verbal promise. The issue in these cases is whether a verbal promise constitutes a legally enforceable contract.
When does a promise become enforceable?
To determine whether a verbal promise has become legally enforceable, you have to consider a number of factors. First, you have to ask whether an actual offer was made. If the offer was so outlandish as to be unbelievable, then it likely won’t be considered enforceable. If, on the other hand, a promise for some sort of transaction is in line with previous transactions between the parties, then it is more likely to be deemed enforceable. This leads to the second factor, which is the business history that exists between the parties. If it was normal for business to be carried out on verbal promises, then a subsequent verbal promise is more likely to be deemed legally enforceable.
One of the biggest factors to take into consideration is detrimental reliance. This means that the party that accepted the verbal offer or promise was harmed in some way by relying on that promise. For example, if the accepting party foregoes another favorable contract, or loses out on sales because the promise goes unfulfilled, then detrimental reliance can be shown.
Competently handle your contract disputes
Contract disputes can wreak havoc on your business. They can threaten your bottom line, put your business’s reputation on the line, and jeopardize the good will that you’ve worked so hard to build. To protect yourself as best as you can, you should make sure that you know the law and how to utilize it to your advantage. If you’re unsure about how to do that, then it might be time to discuss your case with an attorney who is experienced in business transactions and business litigation