A lot of business people take pride in sticking to their word, but when it comes to contracts, is a verbal promise really enough to be legally enforceable? That’s a question that many small business owners have, especially when they know the people they do business with. And the answer to that question can be critical because a broken promise can lead to significant financial losses. That’s why small business owners need to know how these kinds of issues are addressed.
Analyzing whether a verbal promise constitutes and enforceable contract
There’s a lot to take into account when addressing a verbal promise. The first major step is to think about whether an actual offer was made. If someone says they’ll sell you $10 million worth of goods for $100, then you can rest assured that that’s not a serious offer. So context matter, and so does the reasonableness of the offer.
Next, you’ll want to think about how you’ve done business with the other side in the past. If you have often operated based on verbal promises, and both sides have upheld those verbal promises, then it’s more likely that a verbal promise that was broken will be considered legally enforceable.
Perhaps the most important consideration is whether there was detrimental reliance on the promise. This means that you were harmed in some way by relying on the other side’s promise. This could mean losing out on sales or missing a more favorable contract.
Be prepared to aggressively argue your contract dispute
Contract disputes can be messy, but they can be of critical importance to both your business’s bottom line and its reputation. For this reason, you need to aggressively represent your interests. If you think that a verbal promise that was made to you was contractual in nature, or if you’re part of another breach of contract issue, then you might want to discuss your case with an attorney who knows how to fight for you.