Are handshake deals enforceable?

Are handshake deals enforceable?

On Behalf of | Nov 30, 2021 | Uncategorized |

Even in today’s text heavy world, we have all done it, made an agreement, in-person and without a written contract. While these types of handshake deals may seem old fashion, many, if not all, of us still do them from time to time. The question is, can they be enforced?

Oral contracts versus written contracts, generally

Regardless of the state, oral contracts are, generally, as valid as written contracts, depending on the terms and the items to be sold. The problem between the two, though, is that oral contracts are much harder to enforce because proving an agreement existed and the terms of that agreement is much harder. This is because, with an oral contract, there is no memorialization of the agreement, so courts are left to sift through each side’s proof. If it cannot, then, even an otherwise enforceable oral agreement, will not be upheld.

When might handshake deals occur?

Realistically, they can occur at any time for anything, but their enforceability is a question of law. Think about home shopping. While shopping for a home, a buyer and seller meet, they agree on a price and then part ways, with an oral agreement to send a purchase contract over when they get home. Is that enforceable? Can the seller sell to another person, or can the buyer change the terms of the deal? What if the item for sale was a $100 silver coin? Would that make a difference? According to Florida law, it could make a difference, a big difference.

When written contracts are required

Florida, like all other states, has what is called, a statute of frauds. This statute (Florida Statutes, Section 725.01) describes when a written and signed contract is required for the courts to enforce a contract. It exists to prevent fraud, which is why it is called the statute of frauds.

For our Tampa, Florida, readers, written contracts are required for real estate transactions, including easements, sales and mortgages. In addition, it is required when performance will not or cannot occur within one year, but may not apply to contracts with an infinite duration. Contracts to pay another’s debts and leases over one year also must be in writing, along with any health care provider guarantee of results. Finally, it also applies to the sale of goods, if those goods are valued at $500.00 or more.