To Speak or Not to Speak: Verbal Agreements

I’ve blogged about binding verbal agreements before, but they’re worth another look. Most of us have been in that situation – agreeing to something before we know all the details. Verbal agreements you make can be legally binding, even if you change your mind about the terms after making the verbal agreement.

In the case of Robertson v. Whistler (Resort Municipality), the plaintiff injured her arm falling in a shower when she was eight years old. When she was 24 years old, she filed a lawsuit against the property owners seeking damages for pain and emotional upset, loss of enjoyment of life, and further medical treatment.

Part of the treatment included surgery to remove the scar on her wrist from the surgery. The defendant’s insurance company offered $1,400 to cover surgery costs and settle her case. She agreed over the telephone saying “let’s go with it.” After accepting the offer, she discussed the case with her father who, in her words, “freaked out,” thinking she was entitled to more.

The plaintiff refused to sign the release, which is a contractual document, and testified in court that the settlement wasn’t enforceable until she signed the contract. But the defendant argued that the settlement was enforceable as soon as the plaintiff agreed verbally over the telephone.

The judge ruled that settlement agreements do not need to be in writing to be enforceable and the verbal agreement to settle for $1,400 was a legal contract.

It is important to realize that verbal agreements can create a binding contractual settlement even if you change your mind or refuse to sign the settlement documents.

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Saro Turner
Saro joined Slater Vecchio LLP in June 2009. In addition to compensation for pain and suffering, he has obtained compensation for past and future loss of income, health care expenses and more.