FAQs about Debt Recovery
The law and verbal agreements
The main problem with verbal contracts, which can be as legally effective as written contracts (subject to a few exceptions where written contracts are legally required) is evidential, since if someone decides to breach the contract, it will be difficult to prove the existence of terms and conditions. In some cases verbal agreements have not been upheld by a court because the terms of the agreement had not been clarified.
Conditions of a verbal agreement
A verbal agreement can take place in person, via telephone or email.
The law requires two basic terms in order to create a legally binding agreement. This is that there is an agreement on the services to be carried out or goods being delivered and an agreement was reached on the basis of remuneration for this service.
There are certain agreements and contracts that cannot be legally binding if made verbally and should instead be made in writing. These include tenancy agreements, the sale of properties, contracts for consumer credit and copyright transfers.
Written Agreements
If an agreement involves the purchase of a service or receipt of goods that will take time to deliver it is a wise idea to write down the terms of the agreement as a contract or simply just a statement. These statements will be particularly useful if a dispute arises between the parties.
Complete Verbal Agreements
In order for a verbal agreement to be legally binding it must be regarded by the courts as complete. This means that all terms and conditions have been agreed between the parties including services provided and payment amounts. If any part of the agreement has not been fully reached then it cannot usually be upheld in court.
Verbal agreements and disputes
The courts place a lot of emphasis on understanding the original terms of a verbal agreement. The judge may try and use questions in order to ascertain what happened between the parties in practice. Typical questions include the types of services or goods that were agreed upon and if any money was paid either in anticipation or after receipt of services and goods.
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