People make promises on an everyday basis without thinking about it. However, in the business world this can turn out to be a huge legal headache.
There is a big difference between an empty statement and one that carries legal weight. If you are in a business situation, it is important to watch what you say in order to ensure that it is not interpreted as an offer from the other party. According to FindLaw, if one party makes a statement or promise that another party relies on and experiences financial injury as a result of that reliance, the courts may consider the original statement legally binding.
Does there need to be a signature for a contract?
Many people believe that unless they “sign on the dotted line,” there is no contract. However, this is not true. It is possible for email exchanges or even verbal exchange is to become legally enforceable contracts depending on the content of those exchanges.
The court does not need to see a literal signature. However, depending on the circumstances, it can be difficult for a financially injured party to prove that a verbal agreement existed in the first place.
What counts as an offer?
For example, assume that you offer to pay your neighbor $2,000 over the summer to look after your dog while you are out of town. There is no agreement or written contract, but your neighbor agrees and then quits his regular and less-lucrative summer job.
If your adult child decides to live at your house over the summer and you then revoke the $2,000 from your neighbor, your neighbor could potentially sue due to financial injury since he or she no longer has summer employment.