Posted by: Oct 29, 2020

Can Verbal Contracts Be Binding in Texas

If you have ever entered into a verbal contract in Texas, you may be wondering whether that agreement was binding or enforceable.

Many people have a misconception that verbal agreements in Texas are not enforceable. Fortunately, however, this is not necessarily true. If fact, you can have a verbal agreement in Texas that is just as valid and enforceable as a written one.

If you have questions about whether your verbal or oral contract is enforceable, contact the Curley Law Firm today. Sole practitioner Adam Curley is ready and available to discuss your case and answer any questions you may have.

Elements of a Contract Under Texas Law

Before discussing verbal contracts specifically, it is important to have an understanding of what constitutes a contract generally. 

Under Texas law, a contract is formed where the following elements are present:

  1. An offer, 
  2. An acceptance of the terms of the offer, and
  3. Consideration, or something of value provided in exchange for the acceptance of the offer.

As long as offer, acceptance, and consideration are present, there can be a binding contract under Texas law. In most cases, there is no requirement that a contract must be signed or even in writing to be valid and enforceable.

Is a Verbal Agreement Binding in Texas?

So long as your verbal agreement meets all three elements of a contract, you may have a binding verbal contract in Texas. However, there are certain exceptions to be aware of. 

Contracts that Must Be in Writing to Be Enforceable

While the general rule is that a contract need not be in writing to be enforceable, there are certain types of contracts that must be in writing. They are governed by Texas’s statute of frauds

Examples of contracts that have to be in writing include:

  • A promise to answer for another person’s obligation; 
  • A prenuptial agreement; 
  • A contract for the sale of real estate; 
  • A lease of real estate for longer than one year;
  • An agreement for anything that cannot be performed within one year from the date of the agreement; and
  • An agreement to pay a commission for the sale or purchase of oil, gas, or mineral rights.

These types of contracts will not be enforceable unless they are in writing and signed. Thus, if you plan to enter into a contract involving any of these, make sure it is in writing first.

Still, Be Wary of Verbal Contracts in Texas

Just because a verbal contract in Texas can be binding does not mean that it will be. In fact, entering into a verbal contract can sometimes lead to dire consequences.

Often, the biggest issue that arises with verbal contracts is proving that the contract exists. If the opposing party disputes the existence of the contract and you don’t have any proof to the contrary, it can be extremely difficult to convince a court or jury to enforce the contract. 

Thus, when in doubt, err on the side of putting your contracts down in writing. If you haven’t and are wondering what you can do, contact an attorney to discuss your options and next steps.

Contact the Curley Law Firm Today

Adam Curley of the Curley Law Firm is your go-to business law attorney. His practice focuses on helping business entities and individuals in a wide array of transactional and litigation matters. 

The Curley Law Firm has been helping clients for years, and he is ready to help you too. 

If you have questions about the enforceability of your verbal contract or any other matter, contact the Curley Law Firm today.