Are verbal contracts binding?
With many people being caught out by ‘wordy’ contracts written in legalise, gobbledygook, or just through the sheer terror at the thought of having to try and read pages of small print, I thought that an article on this thorny subject would be worthwhile. Many agents are accused of incomprehensible contracts by the public and the consumers association and our Plain English Award for our Sole agency contracted attracted a great deal of press interest as a result.
So is a verbal contract binding?
Yes it can be! Despite what many believe, just because you haven’t signed to say you agree to an agents terms, you may still be bound by them under certain circumstances: for example; accepting a viewing or an offer from, or through, an agent. Another example is when you go shopping. When you buy your groceries, you don’t sign a contract but, if those goods are faulty you can take them back; the shop has a contract with you.
Under English law, an agent must put their terms and conditions in writing to you before they begin marketing or they may have no claim to commission and may be breaking the law however, it is not a requirement for those terms to be signed. This does not mean that any agent can send a contract through the post and start trying to sell your house though, so don’t lose too much sleep!
If in doubt, make it clear to your agent that you do not want them to act for you until you have given them written authority to do and, put those instructions in writing yourself. In any case, under recent distance selling legislation, you may have a seven day cooling off period (depending on where and when you discussed and agreed the agents terms).
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About Chris Wood: Chris is an estate agent with over 25 years of property experience. His business, PDQ Estates Ltd is based in Penzance and Helston, West Cornwall and was included in the Daily Telegraphs’ list of the UK’s top 20 best small estate agents “who go above and beyond to help their customers” in 2013.
No stranger to the media, he has appeared on various programs including BBC, News 24, ITV, independent and BBC radio and is a regular contributor to trade journals, local and national Newspapers. Chris is on Klout LinkedIn Ecademy Facebook and Twitter. Prior to being medically discharged in 2015, Chris was a long-standing member of the Territorial Army and mobilised for a tour of duty in Afghanistan with 1 Rifles as part of 3 Commando Brigade.