Updated November 18, 2020:

Oklahoma verbal contract law notes that a contract is formed when two or more parties agree to do, or not do, something in trade for another thing that has value. A contract can be formally written, casually written, or completely verbal. When one of the parties in the contract doesn't act as agreed, it becomes a breach, and remediation is available under the law to resolve the differences.

Verbal or Written?

While a verbal contract between parties is legally binding, outlining the terms in writing reduces the risk of a breach and makes it easier to be certain about the contract's terms. The contract's terms are the details, like who does what, where and when each party involved will perform, and how each party will go about executing the contract. A verbal contract is harder to take through the court system, though, unless several people were present to witness when the contract was affirmed.

Types of Contracts That Must Be Written

Under contract law in Oklahoma, there are certain types of contracts that have to be written to be enforceable. These contracts types that must be written are:

  • Contracts that show interest regarding real property.
  • Contracts for leasing real property for terms longer than one year.
  • Contracts that can't be completed within a year under the terms given.
  • Contracts for selling or buying high-value items that have a value of $500 or higher.

Contracts That Take More Than a Year

Contracts that take over a year to complete must be in written form, and the terminology can be confusing. Take the example of someone being offered a job for life. In this case, it isn't considered a contract that takes longer than a year to complete, because the person might not live longer than a year, and their passing away would complete the agreement's terms. To be a contract that takes more than a year to complete, the agreement terms must be very specific in stating that completing the agreement will take more than a year.

Important Contract Terminology

Some important contract terminology to understand includes:

  • Mutual agreement: Under mutual agreement, every party involved in the agreement has to understand the terms and know the key points and assumptions associated with it.
  • Capable of contracting: Capable of contracting signifies that everyone involved in the agreement is of age and not mentally impaired or legally disabled and unable to enter into a binding contract.
  • Voidable: If a contract is made, and it turns out that one or more of the parties is not capable of contracting, the contract becomes voidable.
  • Lawful purpose: Lawful purpose means illegal activities cannot be contracted for, and the means to complete the contract can't be illegal.

Legally Binding Verbal Contracts

Verbal contracts are usually honored as legally binding on the conditions they are reasonable, they are equitable, they are conscionable, and they have been made in good faith. Contracts are often thought of as legal documents that are printed out, signed by involved parties, and notarized; however, only a few types are required to be in written form under Oklahoma law. This is because oral agreements are harder to enforce. Clearly written and executed contracts are favored by the court over testimony on the terms of a verbal contract.

Arguing the Terms of a Verbal Contract

It can be hard to argue the terms of a contract defect if it isn't in writing. If an issue goes before the court based on a verbal contract, there's a chance one of the parties might lie about the agreement's terms. It's even a possibility that all involved parties might lie about the contract's terms, which creates an impassable legal issue for the court. Even though oral contracts are hard to enforce through the court system, involved parties should make the effort to discuss how the agreement will be enforced.

Silent, Implied Contracts

Some simple contracts can be completed without any written or spoken words. One example of an implied contract is buying a jug of milk when the milk is exchanged for payment. This is an implied contract because when the milk is placed at the register and money is exchanged, no words need to be spoken.

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