People, in their dealings with others, particularly in quasi or non business related agreements, tend to not reduce to writing the nature of their agreement. For example, a friend loans another friend money. Because they trust one another, and enter into an arrangement that they both believe they understand, that agreement is not written into a "contract." In Arizona, not all agreements need to be reduced to written contract form to be enforceable. However, certain agreements MUST be in writing to be enforceable. Arizona law controls which agreement must be in written form to be enforceable:
ARS 44-101 states that no action shall be brought in any court in the following cases unless the promise or agreement upon which the action is brought, or some memorandum thereof, is in writing and signed by the party to be charged, or by some person by him thereunto lawfully authorized:
1. To charge an executor or administrator upon any promise to answer for any debt or damages due from his testator or intestate out of his own estate.
2. To charge a person upon a promise to answer for the debt, default or miscarriage of another.
3. To charge a person upon any agreement made upon consideration of marriage, except a mutual promise to marry.
4. Upon a contract to sell or a sale of goods or choses in action of the value of five hundred dollars or more, unless the buyer accepts part of the goods or choses in action, and actually receives them or gives something in earnest to bind the contract, or in part payment, but when a sale is made at auction, an entry by the auctioneer in his sale book, made at the time of the sale, of the kind of property sold, the terms of the sale, the price, and the name of the purchaser and person on whose account the sale is made is a sufficient memorandum.
5. Upon an agreement which is not to be performed within one year from the making thereof.
6. Upon an agreement for leasing for a longer period than one year, or for the sale of real property or an interest therein. Such agreement, if made by an agent of the party sought to be charged, is invalid unless the authority of the agent is in writing, subscribed by the party sought to be charged.
7. Upon an agreement authorizing or employing an agent or broker to purchase or sell real property, or mines, for compensation or a commission.
8. Upon an agreement which by its terms is not to be performed during the lifetime of the promisor, or an agreement to devise or bequeath any property, or to make provision for any person by will.
9. Upon a contract, promise, undertaking or commitment to loan money or to grant or extend credit, or a contract, promise, undertaking or commitment to extend, renew or modify a loan or other extension of credit involving both an amount greater than two hundred fifty thousand dollars and not made or extended primarily for personal, family or household purposes.
The attorneys at West, Longenbaugh & Zickerman advise reducing all promises or agreements to writing so that the clear understanding of the parties is documented. There is too much room for misunderstanding, expectation, later disagreement, and potential unenforceability in oral agreements. We are here to assist you with all of your oral and written contractual needs with Big Firm Representation, Small Firm Caring.