You will be surprised to learn that oral agreements may apply under Australian law. For example, if you are processing sensitive customer data, you may need a cyber insurance service or, if you offer a professional service, you may need to cover your business with professional liability insurance. The moral of the story is: Do not risk the end result of your business. Instead, save the handshake for a “Thank you, job well done”. As a general rule, the law does not require that most agreements be reduced to writing to be enforceable. An oral contract or handshake agreement may be applicable in the same way as a written contract. Verbal or handshake agreements are subject to the same contractual principles as those applicable to written contracts. Suppose you had to agree verbally with another person and shake their hand. Later, the other person will not be able to conclude his side of the agreement. Where`s the law? Are handshake agreements applicable? Or are they worth it? The fourth essential element is the intention to be legally bound by the agreement. In the case of a commercial transaction as it is the agreement, there is automatic presumption that the parties wish to be bound by the agreement.
If that is not their intention, they must provide clear evidence. Is the handshake legally binding or not as part of an agreement? The answer is yes, as long as you can prove it in court. It is interesting to note that many powerful people have concluded handshake agreements, from Bill Clinton and Newt Gingrich to Bill Gates and Steve Jobs. But more than likely, these handshake agreements were followed by large contracts that outlined important points of agreement and conditions. If you`re the kind of person who prefers informal chords sealed with a handshake, you have at least a few people at your fingertips to see how you “shake.” A handshake agreement is increasingly binding when there are witnesses to the agreement. In other words, avoid accepting anything in a dark alley if no one else is watching. Unfortunately, there is no clear answer, because if a handshake is very symbolic, it means very little from a legal point of view. That`s why we have to put our hands aside and see what we have left.