Oral Contract Massachusetts: Everything You Need to Know
Oral contract Massachusetts are legally enforceable depending on the contract type.3 min read
2. Hand-Shake Land Swap Agreement
3. Electronic Communication and the Statute of Frauds
Oral contract Massachusetts are legally enforceable depending on the contract type. In Massachusetts, if the contract falls under the statue of frauds, the contract must be written. Oral modifications that affect the basic foundation of the contract should be put in writing to be valid. However, there are exceptions if the oral modifications reference how the contract actions should be performed. This exception is possible due to the Cummings rule.
The Cummings Rule
The statute of frauds is a law that states which contracts must be in writing to be enforced. Based on this understanding, it would be assumed that modifications made to a contract must also be written. However, this is not always the case due to what is known as the Cummings rule. Under this rule, if the modification is directed to how the contract is performed, it can be oral. If the modification is related to the substance of the contract, it must be in writing.
An example of the Cummings rule would be if a buyer requested an extension on the closing date of a real estate contract. If the seller and buyer verbally agree, the new date is now valid. If the seller attempts to say the contract is no longer valid, they would not be correct and would need to complete the closing on the verbally agreed upon date.
Hand-Shake Land Swap Agreement
In a case involving two landowners, an agreement was made for one owner, named Hurtubise, to complete a land swap with the other, named McPherson. The agreement was confirmed with a handshake. The land swap was made in order for Hurtubise to build a structure on the property acquired. After the agreement was made, Hurtubise spent time and money building a new structure. During this time, McPherson was observed at the building site during the seven to eight weeks of construction. There were never any objections by McPherson.
At the completion of the structure, McPherson objected to the new structure and the land swap. McPherson offered to settle the dispute if Hurtubise paid him a fee of $250,000. When Hurtubise refused to pay the fee, McPherson reported the new structure to the local building commissioner. The commissioner revoked the building permit and ordered Hurtubise to not occupy the new structure. When McPherson threatened to tear down the structure Hurtubise filed a suit to enforce the handshake agreement.
While most real estate contracts must be in writing and should be signed under the statute of frauds, the court found in favor of Hurtubise. The judge noted that McPherson made no attempts to stop construction of the new structure or complain about the location of the structure. Due to the lack of complaint, McPherson lost his right to say the handshake agreement wasn't valid. It was also deemed that the $250,000 was out of range of the structures actual cost of $39,690. The judge did enforce the completion of the land swap.
Electronic Communication and the Statute of Frauds
The increase in emails and text messages has brought up the question of whether those types of communication can constitute the creation of a legally binding agreement. In Massachusetts, if the communication includes the necessary elements, it will be seen as a viable written contract under the statute of frauds.
Massachusetts legal precedence has shown that if the emails between a buyer and seller specifically address provisions of a contract, it will be seen by the statute of frauds as a legal contract. The provisions will include:
In addition, if there are a series of emails related to the purchase of a particular property, they may be seen as a contract when combined together and are considered a single instrument. This is only possible when all terms of the contract are present and have been authenticated by the signature of the parties.
With the increase in electronic communication, the law has been updated to validate what constitutes a legal signature. The Uniform Electronic Transaction Act confirms that an electronic signature is legal. This does not just cover a copy of the signature. The law states that the signature can be as basic as a name at the end of an email.
If you need help understanding an oral contract in Massachusetts, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.