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a1handy

How strong is a Verbal Contract

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I own a small auto repair business and recently a customer came to pick up  his vehicle that I had repaired.  I knew in advance that he had no intentions of paying.  When he came, my employee ( I was not present) refused to give  him his vehicle.  He then called the local sheriffs department and was told he would have to file for a Claim and Delivery or pay to get his car back.  The deputy called me and asked what we could do to take care of this situation and I asked him to tell the customer that if he agree to  no future civil litigation concerning this matter he could take his vehicle and not have to pay his bill.  The officer called back and told me he had agreed.  He took the car but subsequently sued anyway? Is this considered a verbal contract and is it viable?  The officer has agreed to testify to the fact that he made such an agreement (actually two officers) as well as there being video from the officers vest cam of the customer making the agreement.  I am planning to ask the judge to dismiss the case based on this contract.   Can I do so?

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You CAN do any number of things. Attempting to list them all won't be very helpful.

 

What you have essentially is a settlement agreement. Settlement agreements are enforceable. You just have to prove what the agreement was.

 

As long as the officers are willing to come to court and stand up and testify as to the agreement, you might be OK.

 

I write "might" because you haven't revealed anything about the repairs or the reason he's suing (said reason would be written in the complaint that was served on you).

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I am planning to ask the judge to dismiss the case based on this contract.   Can I do so?

 

Of course you can ask.  Why would you think you might not be able to ask?  I hope you are taking appropriate steps to ascertain the appropriate way to "ask" the court to do this.

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The customer stated that the repairs did not meet his standards.  From what you are saying,  I take it that a verbal agreement is not a binding agreement in the state of SC.  I have used written "General Release of Liability" agreement in the past and it was in forced.  I was under the impression that a verbal release would be as effective.  The officers are willing to testify that he made the agreement and video evidence is also available due to a vest camera on the officers.  

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The customer stated that the repairs did not meet his standards. 

 

Please quote the words on the complaint form where it says why he is suing. And how much money is he suing your for. And is this in small claims court (magistrate's court)? Did the summons give you a date to appear in court or did it instruct you to file a written answer? Answer all the questions in this paragraph.

 

 

 I take it that a verbal agreement is not a binding agreement in the state of SC.  

 

I didn't see anybody write that.

 

 

I was under the impression that a verbal release would be as effective.  The officers are willing to testify that he made the agreement and video evidence is also available due to a vest camera on the officers.  

 

I wrote earlier that it might be enforceable with the testimony of the officers..

 

You waived your repair bill in exchange for his agreement not to sue. That (to me) is a contract that he is breaching.

 

You have the option of fighting fire with fire by filing a counterclaim for the amount of your bill. Now that he's reneged on the agreement not to sue you are entitled to be paid for your work.

 

South Carolina small claims court addresses answers and counter claims on Pages 6 and 7 of the following guide and provides links to the applicable rules and forms:

 

http://sccourts.org/selfHelp/FAQMagistrate.pdf

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From what you are saying,  I take it that a verbal agreement is not a binding agreement in the state of SC.

 

No one said that.  In fact, I would say that the first response says the exact opposite.

 

 

 

I was under the impression that a verbal release would be as effective.

 

Verbal contracts are, by their very nature, inferior to written agreements because not all types of verbal contracts are enforceable and because verbal agreements are more difficult to prove.  In your case, you seem to have a neutral third party who can testify regarding the agreement.  That is a good thing.

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Hi a1handy,

 

It seems that you misunderstood adjusterjack's assertion that "settlement agreements are enforceable".... "Enforceable" means legal, valid, or "binding" (as you put it). Many of the concepts surrounding contracts can be confusing -- especially when you add in the fact that it  was a verbal contract. For some background information, I suggest you take a look at some of the following helpful articles from our Learn About the Law - Contract Law section:

Depending on the amount of money at stake in your case, you may have to take this issue up in small claims court (which generally does not allow you to have legal representation). Since you'd be going at it on your own, feel free to check out the following blog post for some helpful information on what to expect and how to prepare for your day in court:

If the amount of money at stake is large enough, it would be a civil case -- and you would be allowed legal representation. Since you are dealing with several potentially complicated issues (enforceability of an oral agreement, testimony from the officers, etc.), an experienced attorney would be able to assess the facts of your case, help formulate your best defense, and determine whether filing a counterclaim would be appropriate. You can find South Carolina attorneys in your area by using FindLaw's lawyer directory.

 

Best of luck resolving your case!

 

The FindLaw.com Team

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It was filed in magistrates court.   I have a court date pending.   The officers will appear at my motion to dismiss and say he agreed to no further litigation if I released his vehicle.  He claimed the repairs were not up to his standards in this case the paint was not shiny enough.   I have obtained the police report that states bluntly that he agreed to no litigation if car was released.  He has filed wanting $1399

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The officers will appear at my motion to dismiss and say he agreed to no further litigation if I released his vehicle.

 

A couple things to keep in mind.  First, and while I'm not familiar with the procedural laws applicable in SC magistrates court, a motion to dismiss is typically based only on the content of the complaint and does not allow the court to consider evidence.  Second, while the cops may have said they'll show up, they aren't legally obligated to do so unless you serve them with subpoenas.  If you don't do that, you could get caught holding the bag since the police report is inadmissible hearsay.

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