Are Construction Contracts Enforceable if Not in Writing?

The major players in the construction realm do not, as a general proposition, routinely rely upon oral contracts on complex projects because of the number of issues, parties, and stakes that are usually involved. On the other hand, some projects may be so small or simple (or any number of other reasons may exist) that they may not be perceived to warrant the time and effort required to prepare a written contract.

Regardless, are oral construction contracts enforceable?texas oral verbal construction contract statute of frauds

In Texas, oral construction contracts generally are enforceable. However, they are not enforceable if they fall into or constitute any one of several categories under the Texas Business & Commerce Code including, but not limited to (1) a contract involving the transfer of certain interests in real estate; or (2) an agreement which isn’t to be performed within one year from the date of making the agreement.

Verbal construction contracts may make sense and be relied upon in some situations. In other contexts, they should be avoided — not only because they may not be enforceable, but because there could be other consequences, too, which are not discussed here.

But the fact that an agreement has construction as its subject matter does not in and of itself dictate whether it is enforceable if it is not in writing.

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