While most of the time, both parties will sign a contract, sometimes one party neglects to sign. For whatever the reason, you may end up in a situation where only one party signed the contract. However, in most cases, you may still have a binding written contract. This is because there are only a few situations where a contract has to be signed in order to be binding.
In Texas, there is the Statute of Frauds that governs the contracts that need to be in writing and signed by both parties. If you find yourself in a situation where you didn’t sign the contract, you may actually be bound by its terms. This is crucial to know when working with your attorney on a contractual dispute.
What is the Statute of Fraud and how does it work?
Sometimes, a party will sue another if it thinks that the other person didn’t fulfill an oral promise. This can happen when there is a written contract that was not countersigned by the party being sued. In this case, the defendant will raise the Statute of Fraud, claiming that it is not bound by the written terms of the agreement. However, courts have ruled that this only applies in certain types of contracts.
In Texas, the Statute of Fraud applies in specific situations. For example, if the contract involves:
- marriage,
- real estate,
- guarantees and sureties,
- and contracts that will take more than one year to perform,
then they must be in writing and signed by both parties. The same goes for any contracts for goods valued at over $500, ones that are governed by the Uniform Commercial Code, and ones entered by an executor of an estate. All other types of agreements do not require both parties to sign.
Course of dealings and partial performance
So what happens if the contract you are trying to enforce doesn’t involve one of these situations? For example, what happens if a homeowner hires you to build a pool and then refuses to pay?
What if the Homeowner Didn’t Countersign?
Let’s assume you gave the homeowner a contract that you signed, but he or she didn’t countersign before you started work. In this situation, the homeowner will not be able to invoke the Statute of Frauds because the contract didn’t involve any of the circumstances requiring a fully executed contract.
If you didn’t complete the pool, you can still collect for partial performance under the concept of Quantum Meruit. This translates from the Latin as “for as much as has been earned.” In this situation, you will be able to collect for the partial performance of you work.
The Absence of a Written Contract: What Happens Next
In the absence of a written contract, the court will look at the course of dealings between the parties. One situation is where the parties have been acting like the contract was in fact in place. We often see this with employment situations, where a written contract was not signed by one party but the person went to work for the employer. If the employee performed services and was compensated, then any terms and conditions in the contract that do not last for longer than one year will be enforceable.
The conduct of the person who didn’t sign can also be taken into consideration by the court. If someone sends you a contract that they signed, then you need to let them know that you do not agree to the contract either in whole or in part. If you do nothing and they begin to perform services on your behalf, then you could be bound by the terms of the written contract as long as it doesn’t concern one of the areas covered by the Statute of Frauds.
Keep in mind that if you find yourself in litigation around an unsigned contract, you will have to provide copies of all communications with the other party, such as emails and texts. In Khoury v. Tomlinson, 518 S.W.3d 568 (2017), the Texas Court of Appeals held that a simple statement in an email that “we are in agreement” was sufficient to bind the defendant to a written contract he didn’t physically sign.
If you are involved in a contract dispute, let us help you
Contract disputes arise quite often, especially ones in which one side did not sign a written agreement. If you find yourself involved in a contract dispute, call Ryan G. Cole Law, PLLC. We will help you with the representation you need to get you the results you desire.