Categories
Contract Disputes

Oral contracts in Florida: Are they binding?

Updated: May 26th, 2017With the exception of contracts that are required to be in writing pursuant to Florida law – as listed below – oral agreements are binding and legally enforceable. However, just because an oral contract is enforceable does not make entering into one advisable or favorable. They're notoriously difficult to enforce, primarily because a party wishing to enforce an oral contract must first prove that it existed in the first place.

When attempting to prove the existence of an oral contract, the first question a Hollywood or Fort Lauderdale contract dispute lawyer will ask is this: Are the elements of a valid contract present? The elements of a valid contract, whether oral or written, are:

  • an offer;
  • acceptance of the offer;
  • sufficiently specific terms or a "meeting of the minds";
  • exchange of consideration

HELP YOUR LAWYER GATHER EVIDENCE

If you're trying to prove that an oral contract exists, you might begin by gathering evidence which may indicate the existence of the offer, acceptance of the offer, specific terms and exchange of consideration. Such evidence could include:

  • (a) written communications exchanged regarding the oral contract, like text messages, emails or handwritten notes
  • (b) proof of payment for goods or services, like canceled checks, pay slips, purchase orders or receipts
  • (c) testimony of any third parties present when the oral contract was formed
  • (d) proof of performance of terms of the oral contract

Assuming the party seeking to prove the existence of the oral contract has some of the above evidence, and that evidence is accepted as valid by a Ft Lauderdale court, that party's attorney must now endeavor to prove that there was a mutual understanding regarding the oral contract. It is common for two or more parties making a verbal agreement to have dramatically different perceptions of what was agreed upon. Without the agreement being reduced to writing, it is challenging to prove that any mutual understanding existed.

WHEN WON'T SPOKEN AGREEMENTS CUT IT?

Mutual understanding is critical in certain life-altering transactions. For this reason, Florida law reasonably requires that certain contracts must be in writing to be enforceable. Some examples of contracts that must be in writing are:

  • contracts regarding the buying and selling of real estate
  • contracts to pay someone else's debts
  • contracts for sales of goods greater than $500.00
  • leases that have a term which is greater than twelve (12) months

For the protection of all parties in a transaction, it is preferable to reduce contractual agreements to writing whenever possible. Qualified Ft Lauderdale / Hollywood contract dispute attorneys will make sure that all of the requisite elements are present in a written contract to make it enforceable in a court of law. In the event of a dispute, the written contract will always prevail over an oral agreement.

However, if a party has already entered into an oral contract and that oral contract has been breached, a qualified attorney can assist the party in determining whether the requisite elements exist to prove existence of the contract in court. It is possible to enforce an oral contract, but the likelihood of your lawyer's success will depend greatly on the facts of the case.

Categories
Lien Law

Two contracts; Two mechanic’s liens

Clients sometimes ask us whether they need to do two (2) separate mechanic's liens when they have two (2) small contracts on the same project in Fort Lauderdale or Hollywood. They call hoping that the answer will be that they can get away with one (1) lien. This is either because they did not do two (2) Notice to Owners, they do not want to have to file two (2) separate liens or they just want to avoid the cost and inconvenience associated with doing two (2) liens. The general rule is that your lien rights follow your contract rights.

As such, if your contract dispute involves an owner who you contract with to do certain improvements to his property and in the course of the construction he desires to have other work done on the same property and you have that formalized in the form of a second separate written agreement you (or your Fort Lauderdale contract lawyer) have an obligation to file two (2) liens rather than one (1). By the same regard if you are not dealing directly with the owner of the property you need to make sure that you do two (2) separate Notice to Owners as well as two (2) separate Claim of Liens in Broward County.

ENSURE THAT EACH CONTRACT HAS A CLEAR PURPOSE

Getting paid under both contracts typically involves providing partial Releases of Lien during the course of the project. The fact that there are two (2) separate contracts along with two (2) corresponding Notice to Owners will certainly complicate things further with regard to providing Releases. The simplest solution is to make reference to which contract the Release relates to. This can be done by assigning a contract number to each contract and making reference to that contract number in the Release. A more detailed analysis of Releases is a subject for a future article.

The bottom line is if one is working on a project under two (2) or more separate contracts each contract is treated separately with regard to one's lien rights and as a result, two (2) liens are needed. The good news is that if it is necessary to file suit, you can file suit on both liens under one lawsuit and at least minimize the expenses involved in litigation based on the fact that only one (1) lawsuit is necessary. The contents of this article may not be good news for many in the construction industry from a simplicity standpoint but it is better that you are aware of the facts and your rights under the law and deal with those complications during the course of the job rather than discovering you have lost your lien rights on a portion of the work done on a specific project.

Matters involving construction liens in Broward County can be complicated. Always seek the guidance of an experienced Hollywood or Fort Lauderdale construction lien attorney before filing or responding to a lawsuit.