When people go into business with one another in Louisiana, having a contract is a safe way to ensure that both sides are treated fairly and get what they intended from the relationship. There can, however, be confusion as to exactly what constitutes a contract, particularly when it comes to offer and acceptance of said contract. Understanding the different types of contracts that can be used to come to an agreement about the work and what to do if there is confusion regarding the contract is imperative to a business. This can avoid legal issues, such as a breach of contract and subsequent litigation or defend against it if it does come up.
When there is a contract, one party has made an offer and the other party has accepted it. It can mean anything in terms of business from the simple to the complex. One common cause of disagreement is if it is a verbal contract and whether that is legally binding. In addition, silence after an offer is made can be a source of confusion.
A verbal agreement will be enforceable if an offer is made, and there was an affirmative response to the offer. In general, there will be a basic document for this, but even if there is no documentation, a verbal acceptance is binding.
Written agreements are much easier to enforce because of the existence of the document stating what the offer and acceptance was. For businesses, it is preferable to have these agreements in writing. In fact, in some cases, it is required.
Silence, in general, cannot constitute acceptance. However, when there is a preexisting relationship between the participants, there can be silence in response to an offer, and it can be enforceable. If, for example, there was an ongoing purchasing agreement for a product and there is a change to the price, silence after being informed of this will imply that the relationship should continue as before, regardless of the change. With silence, actions can function as an agreement if the accepting party begins performing the terms of the contract.
Businesses that enter a contract that is verbal or silent should know that they must still have legal protections. It is preferable for business contracts to be written, but if there is an offer and acceptance, either verbally or with silence, and there are problems at any point, having legal assistance experienced in employment contracts is essential. Before entering into any agreement, it is wise to discuss the matter with an attorney.
Source: SmallBusiness.FindLaw.com, “Can Silence Signal Acceptance?,” accessed on Feb. 13, 2018
