Some contracts are legally required to be in writing. Some of these are:
- credit contracts and consumer leases, for example, contracts supplying credit or consumer mortgages
- contracts for the performance of domestic building work to the value of $12 000 or more [Building Work Contractors Act 1995 (SA) s 28]
- contracts for the sale of second hand motor vehicles by dealers [Second-hand Vehicle Dealers Act 1995 (SA) s 17]
- contracts for the sale of land, or any interest in or concerning land [Law of Property Act 1936 (SA) s 26]
- unsolicited consumer agreements (e.g. door to door sales, telephone sales) [Competition and Consumer Act 2010 (Cth) Schedule 2 ss 78, 79].
Generally, contracts do not have to be written down to be legally binding. Most of the everyday contracts we make, such as buying a ticket for a movie or going to the doctor, are not put in writing, but they are still legally binding. There is no need for a written agreement, because everyone understands what their obligations are. An oral contract is just as legal and binding as a written one, although sometimes it can be harder to prove exactly what was agreed.
It may be advisable to put a contract in writing. For example, if a contract is of special importance, involves a substantial sum of money, or if there is a possibility of a dispute about it in the future, it is wise to have a written agreement. A lawyer can prepare this for you, and advise you about your obligations and any pitfalls. The written agreement can be helpful in case of a dispute, in proving that there was a contract, and just what was agreed. Without a written agreement, if the dispute has to go to court, the court will only have each party's word to assist it in working out what happened.
Some agreements will not be legally enforceable, even if written down and signed. These include agreements where there was no consideration, or agreements to do things that are illegal.
The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.