Oral Promises as Contracts
March 11, 2013 By Fisher & Talwar, Professional Law Corporation
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The former CFO of Sterne Agee Group, Inc is suing the Alabama based investment bank for breach of contract, among other allegations. According to court documents, former CFO Brian Barze worked as the CFO of another company which was grooming him for a CEO position when Sterne Agee approached him about the CFO position at its own company.
Barze claims that James Holbrook, Jr., Sterne Agee’s CEO, promised Barze a year’s salary if things “didn’t work out” with Agee. According to Barze, this constituted a contract which Holbrook and Sterne Agee Group now refuse to honor since Barze has been fired by the company.
Allegations by Barze claim that he was let go because he confronted Holbrook about wasteful spending within the company. Holbrook does not deny that he was confronted, but denies that the spending was wasteful. Other charges against Sterne Agee Group by Barze include conversion and defamation. Conversion means depriving another person of their property, which Barze claims that Sterne Agee Group is doing by refusing to return personal assets that Barze invested in the company in the form of stocks, bonds, and cash. He claims defamation because Holbrook has claimed to individuals outside the company that Barze was fired for cooking the books and making material inaccuracies in the company’s records.
Oral Contracts May be Valid
In the case above, the promise by Holbrook that Sterne Agee would pay Barze a year’s salary if things “didn’t work out” seems to be at the root of Barze’s breach of contract claim. Despite the fact that this promise does not appear to have been made in writing, it could still be considered a valid contract under the law.
Just because a contract is worth millions or billions of dollars, it is not necessarily required to be in writing. Granted, it is always beneficial to form an agreement in writing, it is not technically required by law in all instances. There are some contracts, like surety contracts, which must always be in writing, no matter their amount, but those exceptions do not seem to affect Barze from collecting on his oral contract with Holbrook.
A Complicated Area
At its heart, the idea of a contract is pretty simple. For a contract to exist, an offer must be made, accepted, and based on consideration, which is the idea that both parties give and get something in return. However, American contract law is full of nuances and exceptions that can have a major effect on contract disputes, no matter how clear a contract may seem on its face. For example, contracts for services, including employment contracts, are treated much differently than contracts for goods - an important distinction to make before determining whether or not cause for a breach of contract suit exists.
Anyone who believes that they are the victim of a breach of contract should consult with an experienced contract dispute attorney to determine if a case has merit and, if so, the best way to proceed in pursuing recovery.
ABOUT THE AUTHOR: Fisher & Talwar
Vibhu Talwar is an aggressive litigator with more than a decade of legal experience. His practice involves complex business litigation and catastrophic injury. Throughout his legal career, he has assisted businesses and individuals in recovering millions of dollars.
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More information about Fisher & Talwar, Professional Law Corporation
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
Allegations by Barze claim that he was let go because he confronted Holbrook about wasteful spending within the company. Holbrook does not deny that he was confronted, but denies that the spending was wasteful. Other charges against Sterne Agee Group by Barze include conversion and defamation. Conversion means depriving another person of their property, which Barze claims that Sterne Agee Group is doing by refusing to return personal assets that Barze invested in the company in the form of stocks, bonds, and cash. He claims defamation because Holbrook has claimed to individuals outside the company that Barze was fired for cooking the books and making material inaccuracies in the company’s records.
Oral Contracts May be Valid
In the case above, the promise by Holbrook that Sterne Agee would pay Barze a year’s salary if things “didn’t work out” seems to be at the root of Barze’s breach of contract claim. Despite the fact that this promise does not appear to have been made in writing, it could still be considered a valid contract under the law.
Just because a contract is worth millions or billions of dollars, it is not necessarily required to be in writing. Granted, it is always beneficial to form an agreement in writing, it is not technically required by law in all instances. There are some contracts, like surety contracts, which must always be in writing, no matter their amount, but those exceptions do not seem to affect Barze from collecting on his oral contract with Holbrook.
A Complicated Area
At its heart, the idea of a contract is pretty simple. For a contract to exist, an offer must be made, accepted, and based on consideration, which is the idea that both parties give and get something in return. However, American contract law is full of nuances and exceptions that can have a major effect on contract disputes, no matter how clear a contract may seem on its face. For example, contracts for services, including employment contracts, are treated much differently than contracts for goods - an important distinction to make before determining whether or not cause for a breach of contract suit exists.
Anyone who believes that they are the victim of a breach of contract should consult with an experienced contract dispute attorney to determine if a case has merit and, if so, the best way to proceed in pursuing recovery.
ABOUT THE AUTHOR: Fisher & Talwar
Vibhu Talwar is an aggressive litigator with more than a decade of legal experience. His practice involves complex business litigation and catastrophic injury. Throughout his legal career, he has assisted businesses and individuals in recovering millions of dollars.
Copyright Fisher & Talwar, Professional Law Corporation - Google+
More information about Fisher & Talwar, Professional Law Corporation
View all articles published by Fisher & Talwar, Professional Law Corporation
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
