It is true that many oral agreements are legal. This does not mean that they are wise.

Whenever you engage in any significant transaction with another party, you should think seriously about having a contract prepared by a competent lawyer.

A well-drawn contract spells out the rights and duties of the parties in considerable detail. It provides more certainty to the transaction. Each party knows where they stand. The contract acts to deter a party from trying to change its terms when difficulties arise.

A lawyer can play an important role by including terms for the many things which may happen later, but which are usually not thought about in advance (e.g. What happens if the buyer wants to sell the property before he has finished paying the seller for it? Who is responsible for repairs to leased property?)

Since rights and duties are more clearly defined, the likelihood of disputes arising is less. The stress from a major dispute can be very burdensome. A lawsuit is often quite expensive. A written contract is a form of insurance against such worry and expense.

When you propose a written contract, you may hear the objection "Don't you trust me?" If the other party is not willing to document the transaction in writing, perhaps you should should not trust them. You can explain that it is your policy to document your transactions with written contracts, so that there will be no misunderstandings from the outset. You can say "It will be better for both of us if there are no misunderstandings down the road."

It should also be noted that some legal transactions cannot be enforced if there is not a written contract. For example, in Arkansas, agreements to sell real estate must be in writing.

This information is presented by the Law Offices of Jim Carfagno, Jr., P.A. 2000 W. Main, Russellville, Arkansas, telephone 479-968-4747 or 866-842-8341 (toll-free within Arkansas). For more information about our firm, click the home page link below. Thank you for visiting our web site!

Copyright (c) 2011, Jim Carfagno, Jr., P.A. All rights reserved.