Inquiry:

DJ intended to hire BP for photography services. They met online and agreed on a date for the photoshoot. When BP shared his fees, DJ negotiated to lower the costs, which were too high for her budget. Through a series of online communications, BP agreed to reduce his fees to accommodate DJ’s request. However, less than twenty-four (24) hours before the scheduled photoshoot, DJ informed BP that she wanted to cancel. Now, BP is asking DJ to cover the production costs, but DJ argues that she is not liable to pay since they did not have a written agreement.

Is the verbal agreement between DJ and BP valid? Can DJ be held liable based on a verbal agreement?

Answer:

Under Philippine law, contracts or agreements are generally valid and binding, regardless of their form, whether written or verbal, provided that the following requisites are present:

1. There is consent from the parties;
2. The contract is based on an object, which may either be a thing within the commerce of men or services not contrary to law, morals, good customs, public order, and public policy; and
3. The parties are motivated by a cause or consideration in entering into the contract.

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In other words, oral or verbal contracts or agreements have the force and effect similar to a written contract. Nonetheless, this does not apply to contracts that are required by the Civil Code to be written, including but not limited to those that involve real rights over immovable property, sale of real property, and lease for more than one (1) year.

To answer the inquiry above, DJ may be held liable for the production costs based on an oral or verbal agreement between DJ and BP. Nevertheless, BP has the burden to prove that such an agreement exists to support his claim for the payment of the aforesaid costs. 

Ultimately, while oral or verbal contracts are recognized by Philippine laws, it is highly suggested that agreements should be put in writing. This practice helps prevent conflicts or misunderstandings that may arise in the future and can serve as evidence in the event of legal disputes.

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Disclaimer: This article is for informational purposes only and should not be considered legal advice. For specific guidance on the validity and enforcement of an oral or verbal contract, consult with a legal professional.

Padin & Partners Law Offices is a full-service law firm based in Cebu City, Cebu Philippines, that offers legal services such as drafting and notarization of contracts in Cebu City, Cebu, Philippines. For consultations: book an appointment or reach us at +63 (32) 316-1540 or +63 917 188 0361.

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