Are Oral Contracts Enforceable?

Not every contract has to be in writing. In some instances, oral contracts are enforceable. The most basic requirement of every contract – written or oral – is that the parties must be competent to form a contract. In Illinois, a presumption exists that a person of mature age is sane and has the mental capacity to contract. As long as the party in question can understand the nature of the transaction and protect his or her interests, the court will find him or her mentally competent and validate the transaction.

In order for an oral contract to be enforceable, there must be an “offer” and an “acceptance.” An “offer” is the act of one person that gives another the legal power of creating a contract. The offer must have definite material terms or require definite terms in the acceptance so that all promises and performances to be rendered are reasonably certain. Acceptance of an offer must comply strictly with the terms of the offer. Any variation or modification of the terms of the offer constitute a rejection and creates a counteroffer. In addition, the acceptance must be objectively manifested, meaning that, generally, silence cannot be relied upon to establish an acceptance of an offer to enter into a contract. In certain circumstances, acceptance may be implied from the conduct of the parties.

Some contracts MUST be in writing. The Illinois statute of frauds (740 ILCS 80/2) generally requires the following common types of contracts (among others) to be in writing: (1) any contract for the sale of lands; (2) any contract for a longer term than 1 year; (3) contracts assuming the responsibility for another person’s debt; (4) contracts involving the sale of goods over $500; and (5) certain promises made by executors and administrators of an estate.

If you need legal assistance regarding a contract, written or oral, contact the experienced attorneys at Mag Mile Law for a free consultation by calling (708) 576-1624 or emailing us at [email protected].

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