Question

verbal contracts are generally discouraged because ______.

a. there are usually no witnesses to a verbal contract
b. without a physical signature, they can be very difficult to enforce
c. unlike in a written contract, people can easily lie in a verbal contract
d. verbal contracts usually lack the detail necessary to produce a formal contract

Explanation:

Analyze the nature of verbal contracts

Verbal contracts are legally binding agreements made spoken-word rather than in writing. While legally valid in many situations, they present significant practical challenges because there is no physical, written record of the terms agreed upon by the parties.

Evaluate the options

• Option a: While witnesses can help prove a verbal contract, their absence is not the primary reason they are discouraged, as a verbal contract can exist without witnesses.
• Option b: Without a physical signature or written document, proving the existence and specific terms of the agreement in a court of law is extremely difficult. This lack of proof makes them very hard to enforce.
• Option c: People can lie about both written and verbal agreements, but written contracts provide physical evidence to counter lies.
• Option d: Verbal contracts can be highly detailed, so lacking detail is not the inherent reason they are discouraged.

Determine the correct choice

The primary reason verbal contracts are discouraged in business and legal matters is the difficulty of proving and enforcing the agreed-upon terms without written documentation and signatures. Therefore, option b is the most accurate answer.

Answer:

• a. there are usually no witnesses to a verbal contract
• b. without a physical signature, they can be very difficult to enforce (Correct answer)
• c. unlike in a written contract, people can easily lie in a verbal contract
• d. verbal contracts usually lack the detail necessary to produce a formal contract