Question

Martin made an oral contract with Cresheim Garage to work as its manager for two years. Cresheim wrote Martin a letter stating that the oral contract had been made and setting forth all of its terms. Cresheim later refused to recognize the contract. Martin sued Cresheim for breach of the contract and offered Cresheim’s letter in evidence as proof of the contract. Cresheim claimed that the oral contract was not binding because the contract was not in writing and the letter referring to the contract was not a contract but only a letter. Was the contract binding?

Answer 1

Answer:

The correct answer is : Yes, the contract is binding.

Explanation:

While talking about contracts as proof of obligation from a certain party, the document not necessarily has to be official but there must be at least some sort of written evidence with the signature of both parties involved.

In the letter sent by Creshiem Garage, they recognized the oral agreement made with Martin and set the corresponding terms. So, if later on, Creshiem does not recognize the letter they are breaching the initial deal giving Martin the right to sue Creshiem since the letter the contract is binding.