LAW Using the IRAC method Travis was digging holes along the boundary of his pro
ID: 416038 • Letter: L
Question
LAW
Using the IRAC method
Travis was digging holes along the boundary of his property to build a new fence. Unfortunately while he was digging he destroyed some electricity cables that were underground. The cables connected electricity to his neighbour, Bill’s property. Bill was very angry, as he had no electricity. Bill said to Travis, “I am going to take you to court and sue you for cost and inconvenience of what you have done to me.” Travis said to Bill, “Calm down, please don’t take me to court and I will just pay you $2,000.” Bill agreed. Travis now refuses to pay the $2,000, as he believes they do not have a contract. Advise Travis if he has to pay the $2,000 that he and Bill agreed on.
Explanation / Answer
Issue: Is the verbal contract between Travis and Bill that insist Travis to pay $2000 to Bill legally binding and enforceable in court?
Rule: For the verbal contracts to be valid and legally binding there should be an offer and acceptance, mutual consideration, mutual understanding and should be done in good faith.
Application: In this case Travis has made an offer of $2000 to Bill for not taking the case involving the destruction of undergrounds electricity cables which resulted into electricity disruption in Bill’s area. Bill has accepted the offer and did not inform the court. Hence there is an offer and acceptance involved in the agreement. Both the parties have made the agreement in good faith and Bill never thought that Travis would refuse to pay the amount. There was mutual consideration and understanding while making the agreement as Bill did not file the case and Travis was ready to pay for the damages understanding each other’s situation. The verbal agreement can be enforced in court by submitting the evidence for the destruction done by Travis for the electricity cables and the inconvenience suffered by Bill.
Conclusion: Travis should pay the agreed amount $2000 to Bill as the verbal contract contain all the elements to make it legally binding and can be enforced in court.
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