Stories of would be entrepreneurs being cheated out of their share of a profitable business venture because they failed to use a written agreement to protect their interest are occurring more frequently.  Failure to reduce the intentions of the parties to writing is not an automatic lost for the young entrepreneurs.  To succeed in a breach of an oral contract (or written contract) an aggrieved party has the burden of proving that there was an offer, said offer was accepted and some form of consideration was given. Although oral contracts are recognized by the courts there are instances where agreements between parties must be in writing.

  1. Contract involving the sale of an interest in land
  2. Contract that by its terms cannot be completed within one year
  3. Contracts for the sale of goods worth more than $500

As a small business owner this means:

  1.  If you enter into an oral agreement to purchase land and the seller sells the land to another party, you may not have a cause of action.
  2. If you negotiated to sell goods every thirty days for the next two years and the customer fails to pay, you may not have cause of action.
  3. If you have an oral agreement to sell goods worth $600 and the customer fails to perform, you may not have a cause of action against the customer.

While oral contracts are recognized in most cases, they tend to be more difficult to prove therefore its best to  put it on paper as advised by Ann Nesby and Al Green.  If you need help drafting a contract or need an attorney to review an agreement before you sign contact the Murray Law Group, LLC to assist you.