Verbal Agreement Law in California

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Verbal Agreement Law in California: What You Need to Know

In California, a verbal (or oral) agreement is legally enforceable in most situations. However, there are some exceptions and limitations to this rule. In this article, we`ll explore the basics of verbal agreement law in California and help you understand your rights and obligations if you enter into a verbal agreement.

What is a Verbal Agreement?

A verbal agreement is a contract that is entered into orally (i.e., through spoken words) rather than in writing. Examples of verbal agreements include:

– A handshake deal between two business partners

– A verbal promise to pay back a loan

– A verbal agreement to rent an apartment or a room

– An oral agreement between two parties in a dispute to settle the matter out of court

– A verbal agreement between an employer and an employee regarding salary, hours, and responsibilities

Are Verbal Agreements Legally Binding in California?

Yes, in most cases, verbal agreements are legally binding in California. However, there are some exceptions. According to California Civil Code Section 1624, the following types of agreements must be in writing to be enforceable:

– Agreements for the sale of real property (land)

– Agreements that cannot be performed within one year from the date of making the agreement

– Agreements to pay someone else`s debt

– Agreements for the sale of goods worth $500 or more

These exceptions are based on the “Statute of Frauds,” which is a legal doctrine that requires certain types of contracts to be in writing in order to prevent fraud and misunderstandings.

In addition to these exceptions, there are some situations where a verbal agreement may not be enforceable if it violates other laws or public policy. For example, a verbal agreement that involves illegal activities (such as drug trafficking) would not be enforceable.

What Should You Do if You Have a Verbal Agreement Dispute?

If you have a dispute with someone over a verbal agreement, your first step should be to try to resolve the matter informally. You can do this by talking to the other party and trying to reach a mutually acceptable solution.

If informal negotiations fail, you may need to take legal action. In California, you can file a lawsuit in small claims court if the amount in dispute is $10,000 or less. Small claims court is designed to be a low-cost, simplified process that allows individuals to represent themselves without an attorney.

If the amount in dispute is more than $10,000, you`ll need to file a lawsuit in civil court. This process can be more complex and may require the assistance of an attorney.

In either case, you`ll need to provide evidence to support your claim that a verbal agreement was made and that the other party breached the agreement. This can be challenging, as there may be no written documentation or witnesses to the agreement. However, if you can provide compelling evidence (such as emails, text messages, or recordings of phone calls), you may be able to prevail in court.


In conclusion, verbal agreements are generally enforceable in California, with some exceptions. If you enter into a verbal agreement, it`s important to understand your rights and obligations and to document the terms of the agreement if possible. If you have a dispute over a verbal agreement, you may need to take legal action to resolve the matter. As always, consulting with an attorney can help you navigate the legal process and protect your interests.