One common problem I encounter regularly as a part of the business litigation practice here at Mesriani Law Group is the fact that my client failed to put an agreement in writing. Many small businesses tend to act on a handshake basis, working from an oral agreement. Unfortunately, if an agreement is only oral, there is no real evidence it exists.

I find that many of my small business clients will tell me that they didn’t get the agreement in writing because they trusted the other side and the other side “gave their word.” Businesses dealing with each other on an honor system where everyone’s word is their bond, is a wonderful theory, but it only works if both sides are adhering to the honor system. If one side does not and there is no written agreement, the result is invariably that one side refuses to cooperate, causing a dispute that can lead to the need for litigation.

To protect yourself, you should not enter into a contract unless it is in writing. If you do make an oral contract with another party, you should make sure that you reduce it to a writing to memorialize it. Even if it’s just a letter to the other party saying that the letter confirms the deal.

You should follow through in this way, even if you are dealing with a family member or friend. Many of the clients I mentioned above were dealing with “friends” and did not memorialize their agreement for that reason. Then those “friends” refused to honor the agreement, resulting in our involvement. It doesn’t matter if it’s your own mother or father you are dealing with, you need to be sure that every agreement you make is in writing.