After years of hard work, you have built a successful construction business. Navigating operations can involve a quick verbal agreement, which can feel efficient when you are meeting stringent deadlines. However, the legal landscape on handshake deals can turn an informal agreement into expensive litigation.
When a handshake becomes a mechanic’s lien
Under Ohio law, while certain contracts like real estate sales must be in writing, many verbal business agreements are legally enforceable. Longstanding state legal principles allow a court to find that a party waived a written change order requirement if their consistent pattern of conduct and verbal approvals suggest an intent to bypass the written rule.
This can backfire on your business if you refuse to pay for unauthorized overages. A dispute over a verbal agreement can lead a contractor to file a mechanic’s lien against your property, complicating financing and requiring legal action to resolve or discharge.
Why a verbal agreement can mean trouble
Relying on memory is a gamble you cannot afford. When a dispute hits the courtroom, he-said, she-said arguments rarely end quickly or cheaply. Judges look for clear evidence. Without it, you are at the mercy of a lengthy legal process that drains your bank account and distracts you from your next big project.
Documentation is your best defense
Instead of verbal agreements, you can prevent a courtroom battle by ensuring all orders are documented in writing. By implementing strict communication protocols, you strip the opposition of their leverage.
If you are currently facing a dispute over an unwritten agreement, it would be wise to seek legal counsel. An experienced attorney can evaluate your case and provide options that protect your business.