When is a Verbal Agreement Not Binding?

October 24, 2016

Often in a dispute, the parties negotiate a settlement. Sometimes the terms are not written down and signed. Csontos v QT Hotels & Resorts was a case which dealt with that point. Csontos has brought a claim of unfair dismissal. In a conciliation meeting, the defendant made an offer which the plaintiff verbally accepted. The money agreed was paid, but the plaintiff later said that he did not accept the amount and wanted more. He said that he had not thought that he was bound by his acceptance of the amount until he signed a document to that effect. He failed because it was held that he well knew that when he agreed to the offer, he was settling his claim in total.
It is very important to be aware in settlement negotiations, just what the outcome will be if an offered amount is verbally accepted.

The above commentary is general and depends on the individual circumstances. It should not be relied on without specific legal advice.

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