In some rare situations that warrant contracts, you can use handshake deals or oral contracts. This just means that two people, such as two local business owners, have an unwritten agreement in place where they are going to work together. Not every contract technically has to be written down in order to be binding.
That said, there are a few reasons why written contracts are often better than handshake deals. What advantages do they bring to the table?
They are easier to enforce
To start with, it is easier to enforce a written contract if there is a breach. Without anything in writing, it can turn into a situation where both parties tell a different story, and it is difficult even for the authorities to determine what happened.
For instance, perhaps one business owner claims that they only agreed to pay the other party after a job was completed. That other party, however, says that they were supposed to be paid half upfront and the other half upon completion of the project. Both may adamantly claim that these were the terms of the handshake deal, but there is no way to verify what really happened.
They help to prevent disputes
Additionally, written contracts can sometimes help to prevent these types of complications altogether. If there is ever a dispute over terms, even before a contract has technically been breached, both parties can simply review the documentation and determine exactly what their rights and responsibilities may be.
If you are interested in drafting enforceable contracts or navigating a dispute after a commercial contract breach, it can help to work with an experienced attorney given all that is at stake and how complex drafting contracts can be.