Key Topics:  Essential Terms | Oral Versus Written | Statute of Limitations | Breach

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When is a Writing Necessary?

There are certain instances where a writing is needed, as discussed below. However, there are exceptions.  Our lawyers can help you navigate those make a claim or advance a defense, when possible. 

Some of the most significant and high profile  business people insist upon deals involving only a hand shake  (sometimes called “verbal agreements” or verbal contracts,  when a person means “oral). We have had success enforcing  purely oral agreements.  Like other states, Pennsylvania has something call the “statute of frauds” which is designed to prevent fraud by requiring that certain types of agreements be in writing: 

Purchase of real estate or transfer any interest in real estate (other than a lease),

Leases for more than three years, (see Goldman et al. v. McShain, 432 Pa. 61 – Pa: Supreme Court 1968)

Promises to answer for the debt of another,

Sales of goods for $500 or more (see Harry Rubin & Sons v. Con. P. Co. of Am., 396 Pa. 506 – Pa: Supreme Court 1959), 

The sale of personal property for $5,000 or more, and

Leases of goods for $1,000 or more.

Plus, there may be other types of agreement that, by statute, must be in writing such as home improvement contracts.

 

Certain Challenges.

Although certain oral agreement are enforceable, there are  challenges and defenses in terms of proof. Also, some types of  contracts must always be in writing. (However, as discussed  below, there may be other ways to recover relative to an  unenforceable oral contract.)

 

Requirement of a Writing.

As mentioned, pursuant to Pennsylvania’s “statute of frauds,” certain contracts have to be in writing.  Often times, the same also applies for modifications of a contract if the  original agreement was required to have been in writing. Often,  with email and fax being so pervasive, there is usually some  form of writing and the issue is whether the writing that exists  is sufficient.

Plus, even if the parties endorse a written agreement that  satisfied the statute of frauds, the writing may lack clarity or  allow for oral modification by failing to provide that any  modification be in writing.

Contracts for home improvement entered into on or after July  1, 2009 must be in writing to be enforceable against the home  owner.

 

Other Options.

 If the oral agreement is not enforceable as “contract,” it may still be enforceable.  Or, there may be claim for unjust  enrichment or “promissory estoppel,” if no valid contract exists.  Hence, the existence of writing (or lack of one) is just the starting point for contract evaluation.

 

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