Oral Agreement in Indian Law

Oral Agreements in Indian Law: Understanding the Basics

In India, oral agreements are legally recognized, but they are often viewed with suspicion by the courts. The reason for this is that it can be difficult to prove the terms of an oral agreement, especially when there is a dispute between parties. However, this does not mean that oral agreements cannot be enforceable or that they are not binding.

Here`s what you need to know about oral agreements in Indian law:

What is an Oral Agreement?

An oral agreement, also known as a verbal agreement, is a contract that is made through spoken words rather than writing. This means that the terms and conditions of the agreement are discussed and agreed upon through verbal communication.

Oral agreements can be made for various reasons, including business deals, service agreements, and even personal agreements, such as agreements between friends or family members.

Enforceability of Oral Agreements

The Indian Contract Act, 1872, provides that every promise and every set of promises, forming the consideration for each other, is an agreement. Therefore, an oral agreement is a valid contract, and if the essential elements of a contract are present, then it can be enforced in a court of law.

However, proving the terms of an oral agreement can be challenging, as there is no written document that outlines the terms and conditions of the agreement. This means that there is a higher burden of proof in terms of establishing the terms of the oral agreement.

In order to enforce an oral agreement in court, the party seeking to enforce the agreement must provide sufficient evidence to convince the court that an agreement was made, and what the terms of the agreement were.

The Evidence Needed to Prove an Oral Agreement

To prove the existence and terms of an oral agreement, one must rely on oral evidence. Though oral evidence is admissible in court, there are certain restrictions on its admissibility.

As per Section 91 of the Indian Evidence Act, 1872, any agreement that creates, declares, assigns, limits or extinguishes any right, title or interest in an immovable property must be in writing.

Moreover, in case of an oral agreement, the following evidence can be used to prove its existence and terms:

– Witness testimony: testimony from witnesses who were present at the time the agreement was made and who can attest to the terms of the agreement.

– Contemporary documents: documents that were created around the time the agreement was made, such as emails, letters, or invoices, that refer to the agreement or the subject matter of the agreement.

– Conduct of the parties: the conduct of the parties involved in the agreement that indicates that there was an agreement and what the terms of the agreement were.

Conclusion

In conclusion, oral agreements are legally recognized in Indian law, but they can be difficult to prove in court. It is always advisable to have a written agreement in place to avoid any confusion or dispute later on.

However, in situations where an oral agreement is made, parties must take necessary steps to establish its existence and terms, such as recording the conversation or getting a witness to be present at the time of agreement. It is important to keep in mind that oral agreements can be enforceable, but proving their existence and terms can be a challenging task.