If you are planning to enter into a contract with another party, you may wonder whether you need to sign a written agreement or whether an oral or unsigned contract is enough. The answer depends on several factors, such as the type of contract, the terms of the contract and the conduct of the parties.
A contract can be written, oral or implied by the parties’ conduct. A written contract is one that is expressed in words, either on paper or electronically. An oral contract is one that is spoken by the parties. A contract can sometimes be implied from actions and circumstances.
Essential contractual elements
There are four elements to make a California contract valid. First, the parties must be capable of contracting, meaning they are of legal age and sound mind. Second, the parties must consent to the contract, meaning they have a mutual understanding and agreement on the terms and conditions. Third, the contract must have a lawful object, meaning it cannot be for illegal services or violate public policy. Finally, the contract must be supported by consideration, meaning each party must give or promise something of value to the other party.
Does a contract have to be signed to be valid in California?
Not necessarily. Although signing a written contract is the best way to ensure clarity and enforceability, some contracts can be valid without signatures. For example, oral contracts are generally valid in California, except for some specific types of contracts that require a written agreement by law.
These include contracts that cannot be performed within one year, promises to pay the debt of another, leases of real property for more than one year, contracts for the sale of real property and contracts for goods worth more than $500.
This rule is known as the Statute of Frauds, and it aims to prevent fraud and perjury by requiring written evidence of certain contracts.
Even if a written contract is not required by law, it may still be valid if it is unsigned by one or both parties, as long as there is evidence of offer and acceptance, such as emails, letters or other written communications.
Additionally, if the parties act in accordance with the terms of an unsigned contract, such as by performing their obligations or making payments, they may create an implied contract by their conduct.