North Carolina Statute of Limitations on Oral Contracts

In North Carolina, oral contracts are enforceable.

Many people make promises to friends, family members or even business associates. Although it is generally a good idea to memorialize these promises in a written contract, an oral promise or contract is sometimes enforceable. North Carolina recognizes some oral contracts; however, certain contracts must be written before they are enforceable.

Definition

An oral contract must qualify as a valid contract, which means it must contain an offer, acceptance of that offer demonstrating a mutual intent to enter into a contract, and consideration, which is the value of the promises being exchanged within the contract. An oral contract is simply the verbal exchange whereby one party offers something, the other party accepts, and an exchange of goods, services and/or money occurs.

Statute of Limitations

North Carolina General Statutes prescribe a three-year statute of limitations for bringing an action to enforce a contract, whether in written or oral form. However, if you seek to enforce a contract, either oral or written, against the government, the law reduces the statute of limitations to two years.

Limitations

North Carolina law requires certain contracts in writing to be enforceable. Those contracts generally include promises to pay certain debts as well as real estate transactions. Specifically, those contracts include: the promise to pay the debt of another person; a contract for the sale of goods worth more than $500; a contract to sell land; any lease for a period longer than three years; easements for a period longer than a year; a marriage; non-compete covenants; commercial loans; and, the promise to pay a debt discharged in bankruptcy.

References

• North Carolina General Statutes -- Chapter 22, Contracts Requiring Writing
• North Carolina General Statutes § 25-2-201
• North Carolina General Statutes § 1-52
• North Carolina General Statutes § 1-53