Are Oral Contracts Enforceable?
Elements of a Contract in Tennessee
With a few limited exceptions oral contracts are enforceable in Tennessee just like a written contract. Of course, a written contract is much easier to prove because there is hard evidence of the agreement. However, an oral contract IS enforceable in most cases. The parties and/or their witnesses can testify about the terms of the agreement, and things such as partial performance or “normal course of dealing” can serve as powerful circumstantial evidence of the terms of the deal.
A contract is a contract – oral or written – so long as it has the following elements:
- A legal purpose (e.g. Tennessee courts will not enforce a contract between neighbors to illegally use one cable box);
- A mutual agreement that is free from fraud or undue influence;
- Terms that are definite enough to be enforced (e.g. a promise to work for a person’s lifetime would be too vague because a lifetime is not a definite duration); and,
- Adequate value exchanged by both parties (referred to as “consideration” in legal terms).