This recent decision illustrates that in the right circumstances, a verbal contract is just as enforceable as a written contract.
In this case, two people agreed to purchase a home together, which ultimately would require them to tender a down payment on a new construction home. The problem, however, was that when it came time to tender the money, the defendant didn’t have the money, such that the plaintiff tendered it all, despite their verbal agreement that the deposit would be paid 50/50.
Ultimately the two litigants had to walk away from the entire deal, and the deposit, paid for entirely by the plaintiff, was forfeited. The plaintiff sued the defendant for half of that forfeited deposit. The defendant argued that there was no contract, but even if there was, it was “rewritten” when the defendant came forward and said he couldn’t pay his share of the deposit. In other words, the defendant argued that once he proclaimed that he couldn’t pay, the new agreement moving forward was that the plaintiff would pay the entire deposit, which she did.
The court disagreed. The parties had a verbal contract that each would contribute half of the deposit, and that verbal agreement was breached when the time came to tender that money, and the defendant failed to do so. Judgment was rendered against the defendant for half the deposit, plus interest and legal costs.
Maghakian v. Takaoka, 2022 ONSC 2004
https://www.canlii.org/en/on/onsc/doc/2022/2022onsc2004/2022onsc2004.html