Oral Contracts vs Written Contracts in Maryland

Determination of whether a contract actually exists is critical for contract disputes and lawsuits in Maryland. Often within a Maryland breach of contract lawsuit, Maryland Circuit Courts or District Courts will need to determine whether a contract exists and, if so, interpret a contract. Thus, a question often presented in Maryland contract disputes is whether an oral contract is enforceable.

When evaluating contracts in Maryland (such as waivers, releases, construction contracts, leases, and settlement agreements), Maryland Circuit Court and District Courts must first ensure that the contract is an enforceable contract under Maryland law.

Under Maryland law, a contract is established if there exists an offer, acceptance, and consideration, whether or not the offer/acceptance occurs orally or in some written format. However, under Maryland law, certain types of contracts are required to be written (and cannot be made verbally or orally). First, “any contract for the sale or disposition of land or of any interest in or concerning land” must be made through a written memorandum to be enforceable. (Md. Code, Real Property Article § 5-104). Second, “any special promise to answer for the debt, default, or miscarriage of another person” must be made through a written memorandum to be enforceable. (Md. Code, Courts & Judicial Proceedings Article § 5-901). Third, any agreement to “charge any person on any agreement made on consideration of marriage” must be made through a written memorandum to be enforceable. (Md. Code, Courts & Judicial Proceedings Article § 5-901). Fourth, “any agreement that is not to be performed within 1 year from the making of the agreement” must be made through a written memorandum to be enforceable. (Md. Code, Courts & Judicial Proceedings Article § 5-901).

Further, under Maryland law, to be deemed a written memorandum under any of these statutes of fraud provisions in the Maryland Code, the required memorandum must be: “(1) a writing (formal or informal); (2) signed by the party to be charged or by his agent; (3) naming each party to the contract with sufficient definiteness to identify him or his agent; (4) describing the land or other property to which the contract relates; and (5) setting forth the terms and conditions of all the promises constituting the contract made between the parties.” (Wallace v. Brice & Beall v. Beall).

The Maryland Court of Special Appeals has clarified that the purpose of Maryland’s “Statute of Frauds” (these statutes requiring a written memorandum is to “protect[] against a fraudulent allegation of an oral contract, and it prevents the signor from preventing enforcement of the oral contract pursuant to the Statute of Frauds, regardless of when the writing was signed.” (Royal Inv. Grp., LLC v. Wang).

Maryland courts further employ the fundamental rule of contract construction that the entire contract (whether a verbal contract or oral contract), and each and all of its parts and provisions, must be given meaning, and force and effect, if that can consistently and reasonably be done.  “An interpretation which gives reasonable meaning to all its provisions will be preferred to one which leaves a portion of the writing useless or inexplicable.” (Deleon Enters., Inc. v. Zaino).

Proper understanding and interpretation of contracts is critical for navigating a Maryland contract dispute. Longman & Van Grack’s contract attorneys and litigation attorneys in our Bethesda and Rockville offices are experienced in all types of Maryland contract disputes. Our firm’s contract lawyers’ goals are to resolve your legal contract dispute as efficiently as possible. Consequently, our contract attorneys vigorously attempt to resolve a breach of contract matter prior to an actual trial. If necessary, our Maryland contract attorneys have the necessary skills and experience to litigate breach of contract disputes at trial in all Maryland courts. Our contract attorneys have handled contract disputes in Montgomery County Circuit Court (Rockville, MD), Prince George’s County Circuit Court (Upper Marlboro, MD), Frederick County Circuit Court (Frederick, MD), Howard County Circuit Court (Ellicott City, MD), and Baltimore County Circuit Court (Towson, MD).

If you would like to speak to a Maryland contract attorney about a contract-related matter at our Rockville or Bethesda, Maryland Offices, Adam Van Grack and our contract attorneys will take time to thoroughly understand your contract dispute to evaluate what the parties’ responsibilities are and if certain liability exists. Our Maryand contract lawyers and Maryland litigation lawyers will assist you on the best course of action for an efficient resolution of your matter. Contact Adam or our other contract attorneys at (301) 291-5027 for a contract dispute attorney consultation today at one our Maryland Offices (Rockville or Bethesda) .