{"id":4342,"date":"2016-04-04T11:47:27","date_gmt":"2016-04-04T16:47:27","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/business-contracts-forms\/do-all-construction-contracts-have-to-be-in-writing.html"},"modified":"2024-05-24T02:25:25","modified_gmt":"2024-05-24T07:25:25","slug":"do-all-construction-contracts-have-to-be-in-writing","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/do-all-construction-contracts-have-to-be-in-writing.html","title":{"rendered":"Do All Construction Contracts Have to Be in Writing?"},"content":{"rendered":"\n<div class=\"fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30  wp-container-core-columns-is-layout-9d6595d7 fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30\">\n    \n    <div class=\"fl-section-main fl-page-articles fl-section-main fl-section-main-full-width\">\n        <h1 class=\"fl-no-margin-top\">Do All Construction Contracts Have to Be in Writing?<\/h1>\n<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    By <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/lisa-burden-j-d\/\">Lisa Burden, J.D.<\/a> | Legally reviewed by <a\n                href=\"https:\/\/www.findlaw.com\/company\/our-team\/aviana-cooper-esq\/\">Aviana Cooper, Esq.<\/a>\n                | Last updated\n        <time>\n                            May 24, 2024\n                    <\/time>\n    <\/div>\n\n            <div class=\"fl-gutenberg-byline-editorial-note fl-text-sm\">\n            <p>Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n        <\/div>\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" target=\"_blank\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n<p>Construction contracts do not have to be in writing. However, all states in the U.S. have a business law,&nbsp;generally known as a&nbsp;<a href=\"https:\/\/dictionary.findlaw.com\/definition\/statute-of-frauds.html\" target=\"_blank\" rel=\"noopener\">statute of frauds<\/a>,&nbsp;that requires certain types of contracts to be in writing to be a&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/will-your-contract-be-enforced-under-the-law.html\">legally enforceable<\/a>&nbsp;agreement.<\/p>\r\n<p>The statute comes from the common law. As the name suggests, it prevents fraudulent claims, especially in the case of large contracts involving significant subject matter. If agreements listed in the statute of frauds are not in writing, they are not enforceable contracts.<\/p>\r\n<p>Contract law sometimes treats construction contracts as falling within the terms of a state&#8217;s statute of frauds. If that&#8217;s the case, then such contracts must satisfy the writing requirement.<\/p>\r\n<h2>The Statute of Frauds<\/h2>\r\n<p>Oral contracts can be valid contracts under certain circumstances. However, the statute of frauds requires specific contracts to be in writing to be enforceable. The types of&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/contract-law.html\">contracts<\/a>&nbsp;that must be in writing are:<\/p>\r\n<ul>\r\n<li>Contracts in consideration of marriage (including&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/marriage\/top-10-reasons-a-premarital-agreement-may-be-invalid.html\">prenuptial agreements<\/a>)<\/li>\r\n<li>Contracts for more than one year<\/li>\r\n<li>Real estate contracts (the sale of land, etc.)<\/li>\r\n<li>Executor\/estate<\/li>\r\n<li>Sale of goods that are $500 or more (which may be&nbsp;covered under the&nbsp;<a href=\"https:\/\/www.uniformlaws.org\/acts\/ucc\" target=\"_blank\" rel=\"noopener\">Uniform Commercial Code<\/a>)\u200b<\/li>\r\n<li>Surety (an agreement to pay someone&#8217;s debts which often involves a promisor and a guarantor)<\/li>\r\n<\/ul>\r\n<p>There is an exception to the statute of frauds known as \u201cpart performance.&quot; Partial performance means that an unwritten mortgage is enforceable when it is a \u201cpurchase money mortgage.&quot; This occurs when money is provided to the borrower to purchase real estate that will have a mortgage.<\/p>\r\n<h2>State Law<\/h2>\r\n<p>Although state laws governing contracts vary, most states have laws that align with the statute of frauds.&nbsp;<\/p>\r\n<p>The statute of frauds does not expressly cover contracts that are about construction. However, there are certain situations in which a construction contract falls within the categories listed in the statute of frauds. For example, in Florida, the following types of contracts that might involve construction projects must be in writing:<\/p>\r\n<ul>\r\n<li>Credit agreements, such as construction loan financing agreements<\/li>\r\n<li>Contracts that cannot be performed within one year, such as major construction projects<\/li>\r\n<li>Contracts for the sale of goods over $500, like contracts involving expensive construction materials<\/li>\r\n<li>Contracts for the sale of real property, such as contracts involving the sale of improved real estate<\/li>\r\n<\/ul>\r\n<p>In addition, written contracts for construction work frequently include:<\/p>\r\n<ul>\r\n<li>A clause requiring that any modification of the original written agreement must also be in writing<\/li>\r\n<li>A clause stating that the written contract constitutes the entire agreement of the parties<\/li>\r\n<\/ul>\r\n<p>Courts, including the U.S. Supreme Court, generally uphold and enforce these clauses. This is done&nbsp;to defeat an owner or contractor&#8217;s claims that there was a separate oral agreement that changed the terms of the written agreement and can aid you in seeking redress through&nbsp;<a href=\"https:\/\/dictionary.findlaw.com\/definition\/promissory-estoppel.html\" target=\"_blank\" rel=\"noopener\">promissory estoppel<\/a>.<\/p>\r\n<h2>Why It&#8217;s a Good Idea To Have Construction Contracts in Writing<\/h2>\r\n<p>It&#8217;s always a good idea to put a construction contract in writing, even if&nbsp;it&nbsp;does not fall under one of the categories that&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/what-contracts-are-required-to-be-in-writing.html\">require it to be in writing<\/a>. In fact, it&#8217;s a good idea to put any agreement between two parties in writing. There are several reasons why, including:<\/p>\r\n<ul>\r\n<li>A written agreement means the terms of the agreement are clear. Each side can refer to the written document if there is doubt or disagreement about the essential terms.<\/li>\r\n<li>A written contract can be easily reviewed by an attorney, who can point out ambiguity or problem areas in the contract.<\/li>\r\n<li>If there is a breach of contract, a written contract provides the court with a clear picture of each party&#8217;s obligations.<\/li>\r\n<\/ul>\r\n<h2>Are Electronic Contracts Valid?<\/h2>\r\n<p>Electronic documents and&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/what-are-the-rules-regarding-signatures-in-contracts.html\">signatures<\/a>&nbsp;have become increasingly prevalent in many areas of business, including the construction industry. This move towards digitization is aided by laws such as the Electronic Signatures in Global and National Commerce Act (E-SIGN Act). The E-Sign Act allows the use of electronic records, as long as the consumer has consented, to satisfy any law requiring that information be in writing.<\/p>\r\n<p>Separately, some states may have their own requirements for electronic contracts and signatures, particularly for employment contracts.<\/p>\r\n<h2>Getting Legal Help<\/h2>\r\n<p>Dealing with any contract can be tricky, especially when the statute of frauds is involved.&nbsp;If you have questions or concerns about potential legal issues regarding the terms of the construction&nbsp;contract you are considering, you should meet with an experienced&nbsp;<a href=\"https:\/\/lawyers.findlaw.com\/business-commercial-law\/?fli=dcta\" target=\"_blank\" rel=\"noopener\">business and commercial attorney<\/a>&nbsp;in your area. An&nbsp;attorney who is well-versed in&nbsp;construction contracts&nbsp;can provide legal advice on oral&nbsp;agreements and any&nbsp;requirements of the statute of frauds.<\/p>\r\n<p>For more information related to contracts, you can visit FindLaw&#8217;s section on&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms.html\">Business Contracts and Forms<\/a>.<\/p>\r\n<div class=\"was-this-helpful\">\n    <div\n            class=\"was-this-helpful__question-container\"\n            aria-labelledby=\"was-this-helpful__question\"\n            role=\"group\"\n    >\n        <span\n                id=\"was-this-helpful__question\"\n                class=\"was-this-helpful__question fl-text-lg-bold\"\n        >Was this helpful?<\/span>\n        <button\n                class=\"was-this-helpful__button fl-text-sm\"\n                aria-label=\"Yes\"\n                value=\"yes\"\n        >\n            <span class=\"was-this-helpful__button-text fl-text-bold\">Yes<\/span>\n            <i class=\"was-this-helpful__button-icon\">\n                <svg width=\"22\" height=\"22\" viewBox=\"0 0 22 22\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n                    <g id=\"thumbs-up\" clip-path=\"url(#clip0_604_3418)\">\n                        <path id=\"Vector\"\n                              d=\"M6 21H3C2.46957 21 1.96086 20.7893 1.58579 20.4142C1.21071 20.0391 1 19.5304 1 19V12C1 11.4696 1.21071 10.9609 1.58579 10.5858C1.96086 10.2107 2.46957 10 3 10H6M13 8V4C13 3.20435 12.6839 2.44129 12.1213 1.87868C11.5587 1.31607 10.7956 1 10 1L6 10V21H17.28C17.7623 21.0055 18.2304 20.8364 18.5979 20.524C18.9654 20.2116 19.2077 19.7769 19.28 19.3L20.66 10.3C20.7035 10.0134 20.6842 9.72068 20.6033 9.44225C20.5225 9.16382 20.3821 8.90629 20.1919 8.68751C20.0016 8.46873 19.7661 8.29393 19.5016 8.17522C19.2371 8.0565 18.9499 7.99672 18.66 8H13Z\"\n                              stroke=\"#666666\" stroke-width=\"2\" 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