The term “oral contract” refers to: 1. a contract that is partially in writing and partially based on veral promises made between the parites; or 2. is based entirely on the verbal promise/promises between the parties.
Oral contracts generally are considered enforceable. In California, for instance, oral contracts are enforceable subject to specific exceptions. California Civil Code section 1622 provides that, “[a]ll contracts may be oral, except such as are specifically required by statute to be in writing.” Section 1624, subdivision (a), of the California Civil Code provides a list of contracts that must be in writing and are invalid if they are oral only:
The following contracts are invalid, unless they, or some note or memorandum thereof, are in writing and subscribed by the party to be charged or by the party’s agent:
(1) An agreement that by its terms is not to be performed within a year from the making thereof.
(3) An agreement for the leasing for a longer period than one year, or for the sale of real property, or of an interest therein; such an agreement, if made by an agent of the party sought to be charged, is invalid, unless the authority of the agent is in writing, subscribed by the party sought to be charged.
(4) An agreement authorizing or employing an agent, broker, or any other person to purchase or sell real estate, or to lease real estate for a longer period than one year, or to procure, introduce, or find a purchaser or seller of real estate or a lessee or lessor of real estate where the lease is for a longer period than one year, for compensation or a commission.
(5) An agreement that by its terms is not to be performed during the lifetime of the promisor.
(6) An agreement by a purchaser of real property to pay an indebtedness secured by a mortgage or deed of trust upon the property purchased, unless assumption of the indebtedness by the purchaser is specifically provided for in the conveyance of the property.
(7) A contract, promise, undertaking, or commitment to loan money or to grant or extend credit, in an amount greater than one hundred thousand dollars ($100,000), not primarily for personal, family, or household purposes, made by a person engaged in the business of lending or arranging for the lending of money or extending credit. For purposes of this section, a contract, promise, undertaking, or commitment to loan money secured solely by residential property consisting of one to four dwelling units shall be deemed to be for personal, family, or household purposes.