Can You Sue For Broken Oral Agreements In California?

TL;DR:

• Yes, you can sue for a broken oral agreement in California, but only if you meet certain legal conditions.
• Oral contracts are generally valid except where a written agreement is required by law (e.g., real estate deals, long-term leases).
• Courts expect detailed proof, including communications, witness statements, performance records, and payment records.
• In Los Angeles, these claims often succeed when plaintiffs present consistent evidence and file their claims within the two-year statute of limitations.

Oral agreements are a common occurrence in California. From handshake business arrangements to personal promises, many people rely on mutual trust instead of written contracts to formalize their deals.

But what happens when someone breaks that trust? Can a court in Los Angeles enforce an unwritten deal? Let’s break down when an oral agreement is legally binding, and when it’s not.

When Is An Oral Agreement Legally Binding?

In California, an oral agreement is legally binding if it contains all the required elements of a contract. These include the offer, acceptance, consideration, and mutual consent, and don’t violate laws requiring written terms.

Oral agreements are enforceable under California law when they do not fall within the specific types of contracts governed by the Statute of Frauds. Courts examine actions, intent, and clarity of terms.

Valid Oral Contracts: What The Law Allows

Verbal agreements can be just as binding as written ones, provided they meet the legal threshold for enforcement and do not involve transactions that must be in writing.

Common examples of enforceable contracts:

• Agreements for services must be within one year of the contract date.
• Verbal wage or employment arrangements with no set duration.
• Informal loans between friends or family members.
• Month-to-month lease agreements for residential property.

Contracts That Must Be In Writing 

• Sales or transfers of real property.
• Leases exceeding one year.
• Contracts not performable within one year.
• Promises to answer for another person’s debt.

While oral contracts are often legally binding in California, those falling under the Statute of Frauds require a signed writing. The purpose is to enforce it in court, no matter the circumstances involved.

Even if the agreement qualifies as a valid oral contract, your next hurdle is proving that the deal ever existed at all.

What Evidence Is Needed To Prove A Broken Oral Agreement?

Suing over an oral contract requires more than just your word. You must produce strong evidence that confirms the existence, terms, and breach of the unwritten agreement.

Courts seek objective evidence of the parties’ intent, the agreed-upon terms, and acts that demonstrate whether the contract was performed or breached. The more evidence you gather, the stronger your case.

Key Evidence To Strengthen Your Oral Contract Claim

Courts need more than hearsay. They expect you to demonstrate through documentation, witness testimony, or partial performance that the agreement was genuine and legally enforceable.

• Witness Testimony: Anyone who heard the agreement or saw the parties act on its terms may offer persuasive courtroom testimony.
• Text & Email Records: Communications referencing the deal or confirming its terms help prove the contract’s existence and outline expectations.
• Performance Evidence: Did one party start delivering services or products? Proof of this performance supports the claim that both parties understood and began executing the agreement.
• Payment History: Financial records that reflect the exchange of money for services or goods indicate that the transaction was legitimate.
• Follow-Up Confirmation: A later email or text from either party referencing the original oral agreement can be crucial corroboration.
• Statute Of Limitations Reminder: California Code of Civil Procedure § 339 sets a two-year limit from the date of breach to file suit for oral contracts.

The burden of proof in oral contract cases is high. So, organize your documents, timeline, and communications in advance. That is, if you want to pursue legal remedies successfully.

With evidence in hand, you’ll need to know how local Los Angeles courts evaluate these kinds of cases, and what standards they apply at trial.

How Do Los Angeles Courts Handle Oral Contract Disputes?

Los Angeles courts treat oral contract claims with caution. Judges scrutinize every detail to ensure a valid agreement existed, both parties consented, and the breach genuinely occurred.

California courts will not blindly enforce vague or informal promises. You must convince the court that the oral agreement had clearly defined terms. Further, it was acted upon in a manner that was meaningful and enforceable.

How Judges Assess These Claims

Judges examine not just what was said, but how the parties behaved afterward. Inconsistencies, vagueness, or failure to perform can doom an otherwise strong case.

• Meeting Of The Minds: Both parties must have agreed on essential terms, price, services, time, or quantity.
• Specificity: Vague agreements (“We’ll work together and split profits”) often lack the clarity required for enforcement.
• Partial Performance: Courts are more likely to enforce contracts where one or both parties began performing their obligations.
• Behavior Consistency: If both parties acted like a contract existed, this behavior bolsters claims that there was an agreement.

What Happens If You Win?

If you win an oral contract lawsuit, the court may award damages or order other remedies, depending on the harm suffered and the nature of the agreement.

• Compensatory Damages: The most common outcome is the award of money to compensate for the losses incurred due to the breach.
• Restitution: The court may order restitution if services were rendered and you’re owed payment, even without full contract enforcement.
• Specific Performance: In rare cases, a judge might require the breaching party to fulfill the agreement, especially for unique or irreplaceable goods or services.

The court’s primary concern is whether the agreement was fair, mutual, and sufficiently specific to be enforceable without written documentation.

Still unsure if your situation qualifies as a legally enforceable oral contract? Let’s answer some common questions Los Angeles clients ask.

FAQs About Oral Agreements In California

Many clients come to us uncertain about their rights when a verbal agreement falls apart. Below are three questions we hear frequently, and our clear, practical answers.