Can You Sue for Breach of an Oral Contract in California?

Let’s be real: it is a fast-paced world, and not all deals can be put into writing. Many agreements happen over the phone, during meetings, and with a handshake. But what happens when the other party to the verbal agreement does not hold up their end of the deal? You might be left asking, “Can I sue for breach of an oral contract?” So, can you? Yes. In most cases, you can sue for breach of an oral contract in California. However, such an agreement has strict rules and limitations that you need to understand before proceeding with your lawsuit.

Does California Legally Recognize Oral Agreements?

In California, oral contracts are generally treated as just as binding as written ones. California Civil Code section 1622 states that contracts can be oral, except in cases where the law specifically requires a contract to be in writing. If a statute does not require a contract to be in writing, then an oral contract is considered valid as long as it meets the following criteria;

• Both parties agree on the same terms
• Something of value is exchanged (consideration)
• The deal is for a legal purpose
• The individuals involved must have the legal capacity to enter into a contract

If you can prove the existence of all the above elements, a verbal contract can be legally enforced just like a written one, and a breach of contract can result in remedies such as compensatory damages, which are meant to put you back in the position you would have been had the breach not occurred.

When Contracts Must Be in Writing

While verbal contracts can be legally enforceable in California, some contracts must be in writing to be considered valid. According to California’s Statute of Frauds (Civil Code section 1624), here are the contracts that are only valid if they are in writing;

• Contracts that cannot be performed within one year
• Promises to pay someone else’s debt
• Certain leases that last longer than one year
• Agreements for the sale of real property
• Agreements that will not be performed during the promisor’s lifetime
• Other categories listed in the statute

If your agreement falls into one of these categories, a court will most likely not enforce your contract.

What is a Breach of an Oral Contract and How Do You Prove it?

For legally enforceable oral contracts, a breach occurs when one party fails to comply with the terms of the agreement. This is the same case with written contracts. For instance, a breach may occur if a party fails to provide a service or buy or sell something.

While you may be able to sue for breach of an oral contract, it can be challenging to prove a breach of contract without a verifiable paper trail. However, there are ways to establish the existence of a contract and demonstrate that a party failed to fulfill their legal obligations. Some forms of evidence that courts usually rely on include;

• Emails, letters, or text messages confirming the terms
• Witness testimony
• Evidence of partial performance, such as payments or delivery of goods
• Invoices, receipts, or purchase orders tied to the agreement

An experienced business litigation attorney can help you gather the necessary evidence to fight for remedies.

Contact Us for Legal Help

If you believe another party has breached an oral business contract, contact our skilled business litigation attorneys at SAC Attorneys LLP for legal guidance.