While it is always best for contracts to be written down and signed, it is possible to hold another party accountable for a contract that is on a napkin, a handshake, or made orally. Of course, those cases require other types of evidence to prove the terms of the actual contract because parties rarely agree when they become polarized. Sometimes, the terms of an agreement can be changed over time as a result of agreed modifications, waiver, or through acquiescence. Generally, the elements of a breach of a Delaware contract follow the common law.
Breach of contract is more difficult to prove in oral contracts. Additionally, some types of contracts have to be in writing to be enforceable, known as the statute of frauds. For example, real estate contracts must be in writing. For every rule there is an exception, so it is important to know all of the facts, both good and bad, to evaluate the case to determine whether it is worth pursuing or whether alternatives to litigation should be considered. For example, partial performance may be a substitute to a writing signed by the party against whom enforcement is sought.
Another type of breach of contract, called breach of implied terms, focuses on terms that are not part of the express contract, but are necessary to perform the contract. These can be proved by presenting evidence that indicates the course of performance, course of dealings, or industry customs. Plus, under Delaware law, every contract has an implied covenant of good faith and fair dealing. Many Delaware cases have interpreted these different principles to decipher their meaning in different contexts to fill gaps and judge actions after the fact.
Pre-litigation consulting and attempts to avoid court can be worthwhile because litigation should often be the last alternative. You should also consider what the grounds are to challenge jurisdiction, dismiss a case, present affirmative defenses and possible counterclaims, cross-claims, and third party claims. Plus, there is a burden of proof on the party requesting damages that requires admissible evidence be shown to the court before it can rule in your favor. Plus, the judge or jury may not agree with your witnesses or understand your theory of the case. Therefore, working out a deal with the other side is usually preferable to the uncertainty of trying the case.