Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Feb 20, 2013

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That depends primarily on the nature and subject matter of the contract. If you orally agree to purchase your brother’s 1988 Ferrari that is in “mint condition” for $25,999.99, that agreement is legal. As a general rule, however, it is wiser to have the terms written in understandable language – plain English — to save future misinterpretations and errors.

Most states have laws (called “Statutes of Frauds”) listing the types of contracts that must be written in order to be enforceable. The purpose of the Statutes of Frauds is to prevent fraudulent claims from arising. Although the laws vary from state-to-state, the most common examples of contracts that generally must be in writing are:

(1) sales of real property;

(2) promises to pay someone’s debt obligations;

(3) a contract that takes longer than one year to complete;

(4) real property leases that run for more than a year;

(5) contracts for an amount or other consideration that exceeds the state’s threshold;

(6) a contract that will go beyond the lifetime of the one performing the contract;

(7) the transfer of property upon the death of the party performing the contract.

If you agree verbally to a type of contract listed in your state’s Statutes of Frauds without getting the agreement in writing, the contract is not enforceable, although there are some exceptions. Because state laws vary in this area, it is strongly suggested that you consult with your attorney if only to review the proposed contract. Do not wait until after you have signed. That can be too late.