With a written agreement,
You have a prayer;
With a verbal agreement
You have nothing but air.
Everyone in the business world will have an opportunity, at one time or another, to make a verbal commitment and shake hands to “seal” an agreement. However, as all savvy business participants learn, there is no exception to this rule: “Get it in writing.” Here are five reasons to never diverge from this simple rule:
- Why not? That’s right: Why not get your agreement in writing? I cannot contemplate a situation in which it would be unfeasible to commit an agreement to paper (or electronic form, if appropriate). There is no legitimate reason to avoid putting an agreement in writing. You have nothing to lose and everything to gain (see below), so just do it.
- Following up on the above point, there certainly are illegitimate reasons that someone might refuse to put an agreement in writing. One or both parties might not intend to follow through on the agreement (or they might want the option of an “escape” in case following through becomes challenging). That said, in most cases — from a legal and ethical standpoint — an agreement is an agreement, whether verbal or written. (Disclaimer: Consult an attorney, as this is not to be construed as legal advice). Even so, it is all too easy for one of the parties to say, “I never agreed to that. Prove it.” If you have nothing in writing, it will be your word against the other person’s word.
- Even assuming that all parties to an agreement are bargaining in good faith, fully intending to follow through with their commitments (and this is certainly by no means a given), getting an agreement in writing provides clarity on the specifics. Although it is possible to misunderstand a written agreement due to ambiguity, how much more unclear could a verbal agreement be, especially months and years after the fact.
- Requiring agreements to be in writing positions you as a careful professional who wants to make sure the interests of all parties are well served. This will make you attractive to business colleagues with a similar interest in integrity. As a bonus, it will make all the others think twice about doing business with you, knowing that it might be hard to pull a fast one on you.
- Written agreements are legally required for some contracts. And even when not technically required, written agreements can provide the best evidence of what the parties intended. Again, consult an attorney since this is not to be construed as legal advice.
If you have learned this lesson the hard way, you need no further convincing. If you have yet to learn this lesson the hard way, be grateful. Simply make a commitment that you will always follow this rule with no exceptions — no matter how compelling an offer might be from someone who refuses to put the agreement in writing. There is a reason they are refusing, and you can easily call their bluff by standing firm with your requirement to “get it in writing.” If this forces a no-go decision on the deal, you can move forward to the next opportunity knowing that you have spared yourself a lot of wasted time and resources.