If one person accepts an offer to another person and that offer is accepted by the other person, that offer becomes a promise, and we have already discussed the definition of an agreement above. To win the case, the aunt must prove with evidence that her nephew lent the money with the intention of repaying it, while the nephew must prove that he did not accept. Without the documentation of the agreement, it will be a matter of er-she-said. In the end, it is a judge who decides which case is most likely of the party. Most oral contracts are legally binding. There are a few exceptions, however, depending on the design of the agreement and the purpose of the contract. In many cases, it is best to draft a written agreement to avoid litigation. Oral contracts, if properly concluded in front of witnesses, can be applied. For example, in 1984, after Getty Oil was sold to Pennzoil as part of a legally binding handshake agreement under New York law, Texaco made a higher offer and the company was sold to Texaco. (Although the case was tried in Texas, new York law was in effect.) Pennzoil filed a complaint accusing of unlawful interference with the oral contract, which was upheld by the court and paid $11.1 billion in damages, then reduced to $9.1 billion (but was enhanced by interest and penalties). [3] At the end of the day, all that can be said is that where there is an oral ice right, agreements are still applicable, but they are not generally recommended when the contract deals with large transactions and regulates relationships between large corporations such as large commercial real estate, etc. Even if such oral agreements have already been entered into, applicants can prove the existence of essential elements of a contract and, by providing admissible evidence, the applicant can continue to appeal to the courts, as justice cannot be denied only if a written agreement is not available, if alternative evidence supports a complainant`s allegation. If two or more parties reach an agreement without written documents, they will enter into an oral agreement (formally known as an oral contract).

However, the authority of these oral agreements can be a bit of a grey area for those who do not know the law of contracts. An oral contract is an oral agreement that can be legally binding. Like a written contract, the parties enter into an agreement whether or not to accept a commitment.