A contract is a document that represents an agreement between parties, usually in writing, that creates duties and responsibilities between the parties. In general, a contract can be formed in writing or by oral agreement.
An oral contract is a spoken or verbal agreement that can be legally binding. In these cases, there may not be any witnesses to the agreement. Sometimes, only the parties to the contract know what terms to which they agreed. This may cause issues down the road if a dispute arises over contract terms.
Certain types of contracts are required to be in writing in order to be enforceable. Additionally, written contracts are usually easier to enforce. They provide documentation of the terms the parties agreed to and can be used as evidence should a dispute arise from the contract.
Under the statute of frauds, some contracts are required to be in writing in order to be valid. This is done in an attempt to prevent fraud by any party. It also helps prevent one party from taking advantage of another. Contracts that are required to be in writing include:
- Contracts for consideration to marry, which have been mostly eliminated;
- Contracts not to be performed within one year;
- Contracts involving an individual’s promise to pay the debt of another, or surety and guaranty contracts;
- Contracts wherein an estate executor agrees to personally pay debts of the estate;
- Contracts involving the sale or transfer of land;
- Contracts involving an interest in real property, such as a lease;
- Contracts for the sale of stocks and bonds; and
- The sale of goods over $500.00 and/or the lease of goods over $1,000.
The Statute of Frauds is part of the Uniform Commercial Code, known as the “UCC.” The UCC is a model statute that has been adopted by the majority of states in the United States. In most cases, it is used to resolve contract disputes over the sale of goods. The Statute of Frauds statute enacted may vary from state to state, but most are similar to the UCC.
There are certain elements each written contract should contain. These will vary from state to state but generally must include the following elements:
- Identification information of both parties entering into the contract;
- Reasonably identifiable subject matter;
- Clearly stated fundamental terms and conditions; and
- Signatures of all parties to the agreement.
What are the Rules Regarding Signatures on Written Contracts?
A contract signature is the marking the parties to the agreement put on the contract to show that they are agreeing to the terms. There are some signature rules and guidelines for contracts that must be followed.
In most cases, handwritten, stamped, engraved, and/or electronic pen signatures are all adequate for a valid contract unless the contract indicates otherwise. In some jurisdictions, a mark or “X” is sufficient for a valid signature. Should an issue arise from a contract when a party simply made a mark or “X,” the court will review whether the parties intended to enter into the contract or not.
In today’s times, electronic and email signatures are valid signatures. The requirements for electronic signatures vary from state to state. In most cases, there are no requirements for the style of writing a signature must be in, such as cursive writing. Additionally, a date is not required to make a signature valid, as the contract will usually begin on the day it is signed.
Can I have Someone Else Sign a Contract In My Place?
Yes, in some cases, signing legal documents for another individual may be possible. The individual must have authorization to do so. Authorization may be provided through a power of attorney, a business management structure, or even by creating a contract granting the individual such authorization.
There are some cases where a family member may be able to sign a document for another in certain circumstances. These are typically instances such as accepting a package or notice for an individual in the same residence. It may also include acceptance of court summons or subpoenas. In these cases, a spouse or family member in the residence who is over the age of majority will sign the notice that the summons was received and verify that the notice will be delivered to the proper individual.
Does a Contract Need to be Signed by Both Parties to be Valid?
The most obvious type of contract that does not require a signature to be valid is the oral contract discussed above. In that case, neither party signs the contract. In order to be valid, the oral contract must have the following basic requirements:
- The terms are valid and legally enforceable;
- All necessary contract elements are present, including offer, acceptance, consideration and mutuality or meeting of the minds; and
- The agreement does not violate any laws or regulations that are meant to prohibit oral agreements, such as the Statute of Frauds.
In cases where the contract is in writing, there may still be instances where both parties are not required to sign in order to have a valid contract. For example, in a sale of goods contract, on the party accepting the goods is required to sign. This may apply if the individual selling the goods does not have a designated signature area or it was made clear they were not required to sign the contract.
While there may be instances where a signature is not required, it is always best to have all parties to an agreement sign the agreement. This prevents one individual’s word against another’s should any issues arise from the contract. In modern times, signatures have been made easier by the ability to use electronic signing for documents.
When Do I Need A Witness to My Signature?
In some cases, yes a witness to a signature is required and in some cases, no, a witness to a signature is not required. Some types of contracts require signature witnesses to verify the document is authentic. Jurisdictions have different rules regarding the number of witnesses required and what their relationship to the signee may or may not be. It may also depend on the type of contract being witnessed.
For example, most states require at least two witnesses to authenticate the signing of a will. The two witnesses cannot be beneficiaries in the will. In other words, they cannot be receiving anything in the will. They will sign the will on the designated witness line to indicate they observed the signing of the contract and they do not believe a forgery occurred.
Other contracts that may require witness signatures may include:
- Deeds;
- Mortgages;
- Some marriage contracts; and/or
- Other contracts as designed by a specific jurisdiction.
Should I Contact a Lawyer Regarding My Contract Issues?
Yes, you should contact an experienced contract lawyers for any contract issues you may have. A lawyer can assist in negotiating a contract, reviewing a contract prior to signing, or drafting a valid contract. A lawyer can also advise whether or not a contract should be in writing to be enforceable.
Should you have any issues that arise out of a contract already signed, a business lawyer will be able to review the facts of your case and determine what steps you can take to remedy the issue. A lawyer can also review a contract already signed to determine whether it violates any writing or signature requirements in your state.
