Can You Sue for Breach of an Oral Contract?
Proving the Existence of an Oral Contract
As with most answers in the legal realm, whether you can sue for the breach of an oral agreement depends on a number of factors. To have a cause of action for breach of an oral contract, you must first establish that a contract existed, which means proving the existence of an offer, acceptance of the terms of the offer, consideration, and “sufficient specification of essential terms.” St. Joe Corp. v. McIver, 875 So.2d 375, 381 (Fla. 2004) Consideration is the giving of something of value, which is either a benefit to the person making the promise or a detriment to the person to whom the promise is made. Mangus v. Present, 135 So.2d 417, 418 (Fla. 1961). For example, declining or failing to exercise a legal right may constitute consideration. South Miami v. Dembinsky, 423 So.2d 988, 990 (Fla. 3d DCA 1982). Along those lines, suppose a party contests the existence of a contract and the case proceeds to trial, the plaintiff must prove the elements below:
1. The essential contract terms were clear enough that the parties could understand what each was required to do;
2. The parties agreed to give each other something of value. [A promise to do something or not to do something may have value]; and
3. The parties agreed to the essential terms of the contract. In other words, would a reasonable person conclude under the circumstances, from the words and conduct of each party, that there was an agreement. The making of a contract depends only on what the parties said or did.
If the plaintiff does not satisfy all of the elements above, then a contract was not created.
In re Std. Jury Instructions-Contract & Bus. Cases, https://jury.flcourts.org/contract-business-cases-4/contract-business-cases-instructions/
Where the agreement was made orally, the defendant in a breach of contract case will typically claim that the essential terms of the alleged contract were different than those specified by the plaintiff. “The definition of ‘essential term’ varies widely according to the nature and complexity of each transaction and is evaluated on a case-by-case basis.” Lanza v. Damian Carpentry, Inc., 6 So.3d 674, 676 (Fla. 1st DCA 2009) see also Giovo v. McDonald, 791 So. 2d 38, 40 (Fla. 2d DCA 2001). However, there are certain terms, such as the price in a sales contract, that will usually be deemed essential terms.
Further, some types of contracts must be in writing to be enforceable in Florida. For example, real estate sales contracts, prenuptial agreements, a promise to pay the debt of another, and any agreement that is not be performed within one (1) year must be in writing. See Chapter 725 of the Florida Statutes. In addition, any contract for the sale of goods for the price of $500.00 or more must be in writing and signed by the party against whom enforcement is sought before it will be enforceable. Fla. Stat. Sec. 672.201.
Proving Breach of that Oral Contract
Assuming you can prove the existence of a valid and enforceable oral contract, then you must then prove that the contract was materially breached and that you incurred damages due to that breach. See Abbott Labs v. GE Capital, 765 So. 2d 737, 740 (Fla. 5th DCA 2000); J.J. Gumberg Co. v. Janis Services, 847 So. 2d 1048, 1049 (Fla. 4th DCA 2003); and Murciano v. Garcia, 958 So. 2d 423, 423 (Fla. 3d DCA 2007). To prove that a contract was materially breached, “the party alleged to have breached the contract must have failed to perform a duty that goes to the essence of the contract and is of such significance that it relieves the injured party from further performance of its contractual duties.” Burlington & Rockenbach, P.A. v. Law Offices of E. Clay Parker, 160 So. 3d 955, 960 (Fla. 5th DCA 2015). For example, where a landlord failed to retain a “reputable” contractor or architect to provide an independent estimate to substantiate its claim that hurricane damage exceeded a certain percentage of the value of the building before sending a notice of intent to terminate the lease, the court found that failure to retain a “reputable” contractor was a technical and non-material breach. Covelli Family, L.P. v. ABG5, L.L.C., 977 So. 2d 749, 752 (Fla. 4th DCA 2008).
If you would like to learn more about whether you have a valid case for breach of an oral contract or have been sued in connection with the breach of an oral agreement, contact McKellar Poursine, P.L.L.C. at (305) 721-2954.