A partial performance oral agreement is a type of contract in which some terms are agreed upon verbally, but not all aspects of the contract are specified in writing. Typically, partial performance oral agreements are used in situations where parties have a long-standing relationship and trust each other implicitly, such as between two business partners who have worked together for years. These types of agreements can be beneficial for both parties involved, as they can save time and resources while still allowing for flexibility in the terms of the contract.
However, it`s important to note that partial performance oral agreements come with some risks. One of the biggest risks is that the terms of the agreement may not be enforceable in a court of law. This is because there is no written contract that clearly specifies the terms of the agreement, which can make it difficult to prove what was agreed upon if a dispute arises.
Another risk of partial performance oral agreements is that they can be easily misinterpreted. Without a written document that clearly specifies the terms of the agreement, there may be confusion over what was agreed upon and what each party is responsible for. This can lead to misunderstandings and potential disputes down the line.
So, if you`re considering using a partial performance oral agreement in your business dealings, it`s important to be aware of these risks. To mitigate them, it`s a good idea to work with an experienced attorney who can help you draft a written contract that clearly specifies the terms of the agreement. This can help ensure that both parties are on the same page and that the terms of the contract are enforceable in a court of law.
In conclusion, a partial performance oral agreement can be a useful tool for businesses that have a long-standing relationship and a high level of trust. However, it`s important to be aware of the risks and take steps to mitigate them to ensure that the agreement is enforceable and both parties are clear on what is expected of them. With careful planning and the help of an experienced attorney, a partial performance oral agreement can be an effective way to conduct business.