Subscribe to Entrepreneur for $5
Subscribe

Putting Your Oral Agreement in Writing

A reliance letter can put teeth in an oral agreement.

By
This story appears in the June 2006 issue of Entrepreneur. Subscribe »

It's not that oral agreements aren't as binding as written ones. They're just much harder to prove.

So when you can't get it in writing, a reliance letter is a good second choice. Simply send your opponent a letter confirming the terms of your oral agreement with a legal hook at the end: "If this letter is not consistent with your under-standing, please notify me in writing immediately." It warns the other side that you're about to spend time and money or lose other opportunities because of your deal. Now the onus is on them to tell you otherwise. The longer they wait to respond, the more you "relied" and the more binding the deal becomes.

Continue reading this article -- and everything on Entrepreneur!

Become a member to get unlimited access and support the voices you want to hear more from. Get full access to Entrepreneur for just $5!

3 months free with code ZENDESK

Presented by zendesk

3 months free with code ZENDESK