Is a Verbal Agreement Legally Binding in the UK?

Introduction

Speed and convenience are why many deals happen over the phone or by handshake. A contractor agrees to start work “next week,” a freelancer quotes a price in a direct message, or a gym renews your membership by phone. These informal arrangements feel efficient, but if something goes wrong, you will be asked to prove not just that a conversation took place but what was actually agreed. While UK law recognises verbal agreements, the real issue isn’t whether such an agreement is legally binding; it’s whether you can evidence the necessary contractual elements and terms.

The United Kingdom has several legal systems: England and Wales, Scotland and Northern Ireland, and contract rules differ slightly. This guide focuses on England and Wales, where most small claims are filed, but notes where rules vary. It also assumes you are dealing with small claims (disputes below £10,000) and offers practical steps on gathering evidence, understanding exceptions and enforcing your rights. It is educational and not a substitute for legal advice.

If you want to dig deeper into the small‑claims process or need help building your case, see CaseCraft.AI’s product page for an AI‑powered platform that automates forms and evidence management.

Are Verbal Agreements Legally Binding in the UK?

Short answer: yes. The common law does not require a contract to be written, and courts will enforce an oral agreement as long as it contains the same basic ingredients as a written contract. The hurdle is proof: where written contracts speak for themselves, a verbal contract leaves room for conflicting recollections. To succeed in court, you must show that a contract existed, what its terms were and that the other party breached those terms.

Verbal contracts are routinely recognised. The tax authority’s guidance on contracts notes that offers and acceptances “may be written, oral or implied,” and it is settled law that consideration and an intention to create legal relations can also be expressed verbally. Courts regularly uphold business deals sealed by telephone call, email chain or even WhatsApp messages. 

However, certain categories of agreement must be in writing to be enforceable, which are discussed below. Moreover, even where no formal writing is needed, parties often limit variations of their written contracts to written amendments. In practice, you should commit important verbal deals to writing as soon as possible.

What Is a Verbal Agreement and Is It the Same as a Contract?

A verbal agreement or oral contract is simply a contract made through spoken words rather than a written document. It requires more than a casual conversation; there must be a clear offer and acceptance, mutual promises (consideration) and an intention to create legal relations. The law treats an oral contract the same as a written one, but proving it exists is harder.

Consider a few everyday examples:

• Service agreement: You hire a plumber by phone to fix a leak for £150. The price, scope of work and timing are agreed verbally. If the plumber fails to show up, you have a verbal contract claim.
• Freelance work: A freelance designer agrees via email and phone to create a logo for a fixed fee. The client later disputes the fee or denies the agreement. The designer must prove the conversation and its terms.
• Subscription renewal: A gym renews your membership at a special rate during a call. Later, the gym charges the standard rate and denies the conversation. This example appears in CaseCraft.AI’s guide on proving verbal contracts.

These scenarios fall into the realm of small claims if the value is under £10,000, making them suitable for tools like CaseCraft.AI’s small claims map and enforcement guide. Importantly, a verbal agreement is just as binding as a written one when the necessary elements are present; the difference lies in evidencing those elements.

What Makes a Verbal Agreement Legally Binding?

For any contract, written or verbal, to be enforceable under English law, four elements must be present. Without all four, a court will not uphold the deal.

Courts apply an objective test: would a reasonable person think the parties intended to enter into a contract? Casual remarks in a pub usually fail this test, whereas negotiations between businesses over the phone often pass. When in doubt, follow up verbally agreed terms with a written summary to confirm the details and demonstrate intent.

Certainty of Terms

Certainty is sometimes called the fifth element. The terms must be clear enough for a court to enforce. Vagueness – “We’ll split the profits” without specifying percentages – invites disputes over “key terms weren’t agreed.” Keep your verbal contracts specific: state price, quantity, delivery dates and any other material terms. Courts cannot enforce “agreements to agree.”

Course of Dealing and Part Performance

Where terms are unclear, courts sometimes infer an agreement from the parties’ conduct. If you have repeatedly done business with a supplier on similar terms, the court may interpret your course of dealing as evidence of those terms. Likewise, part performance, such as starting work or making a payment, can help prove that a contract existed and may bar parties from denying its existence.

When Do You Need a Written Contract in the UK?

Some contracts must be in writing to be enforceable. These exceptions are critical because an oral promise in these areas will not hold up in court.

• Sale or transfer of land: Section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 requires contracts for the sale of land to be in writing and signed by both parties. Oral contracts for land are invalid.
• Guarantees: A guarantee must be in writing and signed by the guarantor. Email chains can satisfy the Statute of Frauds if they show agreement.
• Intellectual property assignments: Under English law, assignments of copyright and other IP rights must be in writing and signed by the assignor. Without a written deed, ownership does not transfer.
• Settlement agreements (employment disputes): ACAS guidance states that a settlement agreement resolving an employment tribunal claim must be in writing, relate to a specific complaint and include confirmation that the employee received independent legal advice.
• Consumer credit and regulated financial agreements: Many regulated credit agreements must follow statutory formality, including written documentation. If your dispute involves credit or hire purchase, seek advice.
  

If your verbal deal falls into any of these categories, put it into writing immediately. Even if writing isn’t mandatory, confirm oral variations of written contracts in writing because many contracts include “no oral modification” clauses. Having a written record avoids later disputes.

How Can You Prove a Verbal Agreement Exists?

Proving a verbal agreement means showing two things: that the contract existed and what its terms were. Courts expect you to assemble evidence; without it, your claim will fail.

Written Trail: Messages, Emails and Notes

Correspondence is vital. Emails, text messages and letters referring to the agreement can be decisive evidence. Save the following:

• Emails and texts: Confirming what was agreed, such as “Thanks for agreeing to deliver 100 units at £2 each.” WhatsApp messages can form a contract.
• Call notes: Make contemporaneous notes of phone calls; record the time, date, participants and key terms. A follow‑up email summarising the conversation both clarifies misunderstandings and creates evidence.
• Quotes and purchase orders: If someone issues a quote or purchase order after the verbal agreement, retain these documents. They help corroborate the agreed terms.

Conduct and Performance

Evidence of performance can be as powerful as written correspondence. Payments made, goods delivered or services performed indicate that a contract existed. Bank statements showing payments and delivery notes evidencing delivery can be strong evidence. The bank statements or invoices proving payment demonstrate consideration and performance. Keep:

• Payment records: Bank transfers, PayPal receipts or cheques corresponding to the agreement.
• Delivery notes and receipts: Documents showing goods or services were supplied.
• Invoices: Bills issued in accordance with the verbal deal.

Witness Statements and Third‑Party Evidence

Witnesses who heard the agreement or saw you act on it can corroborate your version. Your own account and third‑party evidence are crucial. Witness statements must follow Civil Procedure Rules, with numbered paragraphs and a declaration of truth. When preparing witness statements:

Send a Written Summary

After reaching an oral agreement, send a brief confirmation email or text summarising the key terms: price, scope, delivery dates and any payment schedule. Even if the other side doesn’t respond, your summary shows your understanding of the deal and gives them the chance to correct any errors. Courts often treat such summaries as corroboration.

Organise Your Evidence

Create a timeline of events and file all messages, invoices and notes in one place. In a small‑claims case, you must provide copies of all documents you intend to rely on at least 14 days before the hearing. Platforms like CaseCraft.AI automate evidence collection, generate legal documents and guide you through the process.

Can I Record a Conversation to Prove a Verbal Agreement?

In England and Wales, it is generally lawful to record a conversation you are part of without telling the other party, provided the recording is for personal use. However, data protection and privacy rules restrict sharing or using such recordings. Courts may accept recordings as evidence but will consider how they were obtained, their reliability and whether admitting them is fair. Secret recordings can be admissible but may carry less weight, so seek legal advice before relying on them. When in doubt, rely on written confirmations and other evidence described above.

What Happens If Someone Breaks a Verbal Contract in the UK?

A breach of contract occurs when one party fails to perform their obligations, for example, refusing to pay, not delivering goods or doing substandard work. Verbal or written, the remedy is the same: you can claim damages or specific performance through the courts. But before filing a claim, follow these practical steps.

Steps to Take Before You Escalate

Limitation Period and Other Pitfalls

A six‑year limitation period applies to breach of contract claims, meaning you must file within six years of the breach. This rule does not apply to deeds (12 years) or personal injury claims (three years). Failing to act within the time limit bars your claim regardless of its merits. Documented evidence must also be disclosed at least 14 days before the small‑claims hearing; failure to comply may lead to costs or dismissal. Always follow court directions.

How to Reduce Risk When Deals Start Verbally?

Most disputes over verbal agreements arise from misunderstandings, missing details or lack of evidence. You can reduce risk by adopting simple habits:

• Send a same‑day confirmation: After any verbal agreement, send a concise email or message restating the terms. A sample script: “Thanks for the call. As discussed, you will supply 100 widgets at £2 each for delivery by 31 March. I’ll transfer £200 on receipt. Please let me know if this isn’t correct.” This both clarifies and evidences the deal.
• Use short written agreements: For repeat business or higher‑value transactions, prepare a one‑page written agreement or terms of business. 
• Make key terms explicit: State price, scope, timelines, payment schedule and cancellation or late payment terms. Avoid vague language or “we’ll finalise later.” Courts need definite terms to enforce a contract.
• Confirm variations in writing: Even if a contract allows oral variations, follow up any change with a written note. Many commercial contracts require written variations, and a written record avoids later disputes.
• Keep contemporaneous notes: Write down what was said, by whom and when immediately after the conversation. Time‑stamped notes hold more weight than memories.
• Store evidence securely: Use digital folders or platforms like CaseCraft.AI to organise emails, invoices and messages. 

These habits not only protect you but also make it easier to prove your case if a dispute arises. If your business involves frequent phone deals, consider setting up standard confirmation procedures and training staff accordingly.

Next Steps

Verbal agreements are not worthless; they can bind parties just as strongly as written contracts, provided the essential elements are present. The main challenge lies in evidencing offer, acceptance, consideration and intention, and in proving the terms. Keep a written trail, document performance and gather witness evidence. Remember that some deals (land, guarantees, IP assignments and settlement agreements) must be written.

For small claims in England and Wales, consider using an AI‑enabled platform such as CaseCraft.AI. It helps you determine eligibility, organises evidence and prepares the necessary forms while charging only a £15 processing fee plus a 10% success fee if you win. Whether you use a platform or go it alone, transforming verbal agreements into written confirmations is the best way to avoid disputes. 

Note: This content is for general information only. It does not constitute legal advice.