Are Oral Contracts as Good as Written Contracts?
Contracts can be oral or written. They can even be implied by the conduct of the parties. But does that mean you needn’t bother to have a contract put in writing? The answer is “No!” It is always better to have your contract in writing, and there are several reasons why.
First and foremost is certainty. Your recollection of what you agreed to might be very different than what the other contracting party remembers. Then, when a disagreement arises, it becomes “he said / she said,” and left up to the whims of a jury. A written contract substantially reduces the likelihood that the parties will dispute the fundamentals of what they agreed to. For this reason alone, all contracts should be written. It’s worth the cost of a sheet of paper.
There are some other important reasons why it is better to have a written contract. Some types of contracts must be in writing and are unenforceable if not. They include real property transactions (including leases for over one year), personal guaranties and contracts that will not be fully performed for over one year. And the time limit for bringing suit on a written contract is twice as long as on an oral contract: four years versus two.
So, if you want certainty in your contracts and the peace of mind that comes along with it, put them in writing. And, obviously, have the other person sign it! It’s not a “written contract” just because you write down what you and the other person agreed to. It has to be signed too.