Verbal Agreement Legally Binding UK: Everything You Need to Know
A verbal agreement, also known as an oral agreement, is a type of contract that involves two or more parties reaching an agreement without it being in writing. In the UK, verbal agreements are legally binding, just like written agreements. However, the lack of written documentation can make it difficult to prove what was agreed upon, and this can lead to disputes later on.
In this article, we’ll take a closer look at verbal agreements and explore some of the key things you need to know to ensure that your verbal agreements are legally binding in the UK.
What makes a verbal agreement legally binding?
For a verbal agreement to be legally binding, it must meet the same requirements as a written agreement. This means that three elements are essential for a contract to be valid:
1. Offer – one party makes an offer to another party
2. Acceptance – the other party agrees to the offer made
3. Consideration – something of value is exchanged between the two parties (for example, money, goods or services)
If these elements are present in a verbal agreement, it is legally binding, just like a written agreement.
When are verbal agreements commonly used?
Verbal agreements are commonly used in many different settings, especially where people have an ongoing relationship, or there is a high level of trust between the parties involved. Some common examples include:
1. Business agreements – verbal agreements are often used between business partners or between a business and a supplier or customer.
2. Employment agreements – verbal agreements are sometimes used in employment settings, particularly where there is a long-standing relationship between the employee and employer.
3. Personal agreements – verbal agreements are sometimes used in personal settings, such as between family members, friends or neighbours.
What are the risks of relying on verbal agreements?
While verbal agreements are legally binding in the UK, there are some risks associated with relying on verbal agreements instead of written contracts. These include:
1. Difficulty in proving the terms of the agreement – without written documentation, it can be challenging to prove what was agreed upon.
2. Misunderstandings and disputes – verbal agreements can lead to misunderstandings and disputes, especially if the parties involved have different recollections of what was agreed upon.
3. No record of the agreement – without a written record of the agreement, it can be challenging to enforce the terms of the contract.
How can you ensure that your verbal agreements are legally binding in the UK?
If you want to ensure that your verbal agreements are legally binding in the UK, there are some steps you can take:
1. Get it in writing – if possible, try to get a written agreement that includes all the terms of the verbal agreement.
2. Keep records – keep records of any conversations or meetings related to the agreement, including emails, text messages or phone calls.
3. Be clear about the terms of the agreement – ensure that both parties understand and agree on the terms of the agreement.
4. Get legal advice – if you are unsure about the legality of a verbal agreement, seek legal advice.
In conclusion, verbal agreements are legally binding in the UK, but they come with some risks. To ensure that your verbal agreements are legally binding, it’s important to get a written agreement when possible and keep records of all conversations related to the agreement. It’s also essential to be clear about the terms of the agreement and seek legal advice if necessary. By taking these steps, you can ensure that your verbal agreements are legally binding and enforceable in the UK.