Commercial law
Are Handshakes Legally Binding?
Are handshakes legally binding? Short answer: often yes—but proving what you agreed on – that is the hard part. This article will describe when a handshake can lock you in, when it must be in writing, and how to protect yourself through the handshake plus model you can apply when a handshake is a strategic must to close the deal.
For a more vibrant video explaining what you need to know, click here to see the Are Handshakes Binding on Business Law Toolbox YouTube.
Myth-bust in 60 seconds (what a contract really is)
Law school in one minute: a contract is (1) an offer, (2) acceptance, (3) consideration, and (4) a meeting of the minds (that is an intent to be bound and terms clear enough to enforce). Notice what’s missing? Paper. In many countries, a contract can be oral, by conduct, or electronic. And as regards the latter, “electronic” that will typically include emails, text messages, or you clicking on a button with the text ‘I agree’. So why do we lawyers love paper? Because in court the game is ‘Can you prove it? Because it is the party that claims that a valid contract has been entered into between two parties that must prove that this is so, and if there is only a handshake to refer to, this will be tricky to say the least. So even if you are right, and the oral contract is binding, you should not expect to get the contract enforced by the courts if the other party subsequently does not want to recognize that an agreement was entered into or that it was entered into on different terms than the ones you claim.
Example:
You agree to buy a used coffee truck for $25,000. You shake on it. Seller later says, ‘I said $35,000.’ Now it’s your word versus theirs. If all you have is a handshake, you might own…a very expensive argument and no way to get it enforced.
The big exception: deals that must be in writing
Even in countries that recognize oral contracts, some categories legally require writing. The list varies, but here are usual suspects:
Real estate/land transfers and long leases.
Guarantees/suretyships (‘I’ll pay if my friend doesn’t’).
Long-duration deals (often those that can’t be performed within a year).
IP assignments, prenuptials, certain employment or consumer contracts.
Sale of goods over a certain value (e.g., in parts of the U.S., over $500 under the Uniform Commercial Code if no explicit exemption is applicable — also note that local variations exist however).
So if your deal sits in one of these buckets, a handshake alone can be unenforceable no matter how sincere it felt.
Country overview
Remember the importance of checking your local jurisdiction because different countries will apply different rules that are key when it comes to if and how you can enforce an oral agreement.
United States/England & Wales (common law): Oral contracts are generally valid, except categories under “Statute of Frauds” (like land, guarantees, those ‘over a year’ deals). You’ll still need evidence—emails, texts, invoices.
Sweden & Nordics (civil law but handshake-friendly): Oral agreements can be binding, but proof rules and certain statutes (real property, guarantees) push you toward writing. Business practice absolutely expects written confirmation.
Germany/France (civil law): Oral agreements can form contracts, but civil codes impose form requirements for specific transactions (e.g., notarial deeds for real estate in Germany).
E-contracts globally: Many jurisdictions treat emails, PDFs, and e-signatures as writing. ‘Clickwrap’ with clear terms often works; ‘browsewrap’ (just a link) is shakier.
Bottom line: your country, the contract type, and the price tag all matter.
The real battlefield: burden of proof
In civil cases, the claimant usually must prove the contract more likely than not or on the balance of probabilities. If it’s your handshake, you carry the burden to prove what was agreed—price, scope, deadlines. Courts look for:
Contemporaneous records: emails, texts, Slack/WhatsApp, calendar invites.
Conduct: Did money move? Were goods delivered? Did anyone start work?
Witnesses: Who saw the handshake or heard the terms?
Part performance / reliance: Did you act in a way only explained by the deal?
Example:
A pizzeria owner shakes on a local soccer team sponsorship: ‘Free pizzas after every win!’ The team wins… a lot. Owner insists it was ‘first win only’. The team shows Instagram DMs and a flyer draft the owner approved. Not a written contract, but great evidence. Guess who, very likely, will need to keep delivering free pizza to the team?
Handshake traps that lead to trouble
An oral contract can often feel great in the moment, like the deal is clear. However experience shows that there are many pitfalls that show up later in the business relationship even if both parties agree that the handshake did constitute a deal and start acting accordingly. Typical issues that lead to conflict later on include:
Scope creep: You agree to ‘do the app’—did that include Android, iOS, backend, maintenance?
Price surprises: What as actually included in that price. For example: ‘$20k fixed’ vs. ‘$20k estimate’?
IP ownership: When a collaboration is instigated there will often be new IP created, in particular copyright. So questions as regards who owns the code, design, photos often arise later on, in particular if things go well and there is (more and more) money on the table to grab between the parties.
Payment terms: In oral deals there is seldom such detailed discussions as to address how, exactly, is the payment terms to be designed. Issues sucha as did the parties mean “net 30”? or what milestones are included and should give rise to payment installments? What happens if there are late-payments, should there be interest, if so what size, or should there be a walk-away-right for the non-breaching party?
Exclusivity & confidentiality: Key matters such as exclusivity and protection of trade secrets and general confidentiality are seldom outlined sufficiently and this can give rise to both damages to your business and to litigations later on.
Handshakes feel friendly. Litigation feels unnecessary in hindsight.
How to make a handshake safer
If you must move fast, do the ‘Handshake-Plus’:
Confirm by email/text immediately:
Great meeting. We agreed: I supply 1,000 units @ $18 each; delivery June 30; payment net 30; my design remains my IP until paid in full. Shout if I’ve missed anything.’
Attach or link key terms (quote, spec, scope of work).
Ask for a ‘Yes, confirmed’ reply. Even a thumbs-up emoji has helped in real cases.
Start a paper trail: POs, invoices, delivery notes, meeting notes with dates.
Follow up on changes: ‘Per our call today, price increases to $19 from order #214.’
When you absolutely need a full written contract
Some examples of situations where you should always seek a full written contract will include:
It touches real estate, guarantees, IP assignments, or multi-year commitments.
The deal is high value or mission-critical.
You’ll share confidential info or create IP.
You need clear remedies: late fees, service levels, warranties, limitation of liability, termination rights.
You’re in different countries (governing law, court/arbitration, language, currency, tax).
Summary
Handshakes are often binding, but they come with great risk exposure. Are they a good business habit? A well thought through contract beats a long expensive lawsuit.
If you need to close a deal fast by a handshake, do the handshake plus and secure the deal by following up in writing. Remember that laws differ by country and contract type, and the person who claims a deal exists usually has to prove it. Author: Kat Strandberg Dubai 2025-10-26
Email: Kat@stgcommerciallaw.com
For a more vibrant video explaining what you need to know, click here to see the Are Handshakes Binding on Business Law Toolbox YouTube.
Myth-bust in 60 seconds (what a contract really is)
Law school in one minute: a contract is (1) an offer, (2) acceptance, (3) consideration, and (4) a meeting of the minds (that is an intent to be bound and terms clear enough to enforce). Notice what’s missing? Paper. In many countries, a contract can be oral, by conduct, or electronic. And as regards the latter, “electronic” that will typically include emails, text messages, or you clicking on a button with the text ‘I agree’. So why do we lawyers love paper? Because in court the game is ‘Can you prove it? Because it is the party that claims that a valid contract has been entered into between two parties that must prove that this is so, and if there is only a handshake to refer to, this will be tricky to say the least. So even if you are right, and the oral contract is binding, you should not expect to get the contract enforced by the courts if the other party subsequently does not want to recognize that an agreement was entered into or that it was entered into on different terms than the ones you claim.
Example:
You agree to buy a used coffee truck for $25,000. You shake on it. Seller later says, ‘I said $35,000.’ Now it’s your word versus theirs. If all you have is a handshake, you might own…a very expensive argument and no way to get it enforced.
The big exception: deals that must be in writing
Even in countries that recognize oral contracts, some categories legally require writing. The list varies, but here are usual suspects:
Real estate/land transfers and long leases.
Guarantees/suretyships (‘I’ll pay if my friend doesn’t’).
Long-duration deals (often those that can’t be performed within a year).
IP assignments, prenuptials, certain employment or consumer contracts.
Sale of goods over a certain value (e.g., in parts of the U.S., over $500 under the Uniform Commercial Code if no explicit exemption is applicable — also note that local variations exist however).
So if your deal sits in one of these buckets, a handshake alone can be unenforceable no matter how sincere it felt.
Country overview
Remember the importance of checking your local jurisdiction because different countries will apply different rules that are key when it comes to if and how you can enforce an oral agreement.
United States/England & Wales (common law): Oral contracts are generally valid, except categories under “Statute of Frauds” (like land, guarantees, those ‘over a year’ deals). You’ll still need evidence—emails, texts, invoices.
Sweden & Nordics (civil law but handshake-friendly): Oral agreements can be binding, but proof rules and certain statutes (real property, guarantees) push you toward writing. Business practice absolutely expects written confirmation.
Germany/France (civil law): Oral agreements can form contracts, but civil codes impose form requirements for specific transactions (e.g., notarial deeds for real estate in Germany).
E-contracts globally: Many jurisdictions treat emails, PDFs, and e-signatures as writing. ‘Clickwrap’ with clear terms often works; ‘browsewrap’ (just a link) is shakier.
Bottom line: your country, the contract type, and the price tag all matter.
The real battlefield: burden of proof
In civil cases, the claimant usually must prove the contract more likely than not or on the balance of probabilities. If it’s your handshake, you carry the burden to prove what was agreed—price, scope, deadlines. Courts look for:
Contemporaneous records: emails, texts, Slack/WhatsApp, calendar invites.
Conduct: Did money move? Were goods delivered? Did anyone start work?
Witnesses: Who saw the handshake or heard the terms?
Part performance / reliance: Did you act in a way only explained by the deal?
Example:
A pizzeria owner shakes on a local soccer team sponsorship: ‘Free pizzas after every win!’ The team wins… a lot. Owner insists it was ‘first win only’. The team shows Instagram DMs and a flyer draft the owner approved. Not a written contract, but great evidence. Guess who, very likely, will need to keep delivering free pizza to the team?
Handshake traps that lead to trouble
An oral contract can often feel great in the moment, like the deal is clear. However experience shows that there are many pitfalls that show up later in the business relationship even if both parties agree that the handshake did constitute a deal and start acting accordingly. Typical issues that lead to conflict later on include:
Scope creep: You agree to ‘do the app’—did that include Android, iOS, backend, maintenance?
Price surprises: What as actually included in that price. For example: ‘$20k fixed’ vs. ‘$20k estimate’?
IP ownership: When a collaboration is instigated there will often be new IP created, in particular copyright. So questions as regards who owns the code, design, photos often arise later on, in particular if things go well and there is (more and more) money on the table to grab between the parties.
Payment terms: In oral deals there is seldom such detailed discussions as to address how, exactly, is the payment terms to be designed. Issues sucha as did the parties mean “net 30”? or what milestones are included and should give rise to payment installments? What happens if there are late-payments, should there be interest, if so what size, or should there be a walk-away-right for the non-breaching party?
Exclusivity & confidentiality: Key matters such as exclusivity and protection of trade secrets and general confidentiality are seldom outlined sufficiently and this can give rise to both damages to your business and to litigations later on.
Handshakes feel friendly. Litigation feels unnecessary in hindsight.
How to make a handshake safer
If you must move fast, do the ‘Handshake-Plus’:
Confirm by email/text immediately:
Great meeting. We agreed: I supply 1,000 units @ $18 each; delivery June 30; payment net 30; my design remains my IP until paid in full. Shout if I’ve missed anything.’
Attach or link key terms (quote, spec, scope of work).
Ask for a ‘Yes, confirmed’ reply. Even a thumbs-up emoji has helped in real cases.
Start a paper trail: POs, invoices, delivery notes, meeting notes with dates.
Follow up on changes: ‘Per our call today, price increases to $19 from order #214.’
When you absolutely need a full written contract
Some examples of situations where you should always seek a full written contract will include:
It touches real estate, guarantees, IP assignments, or multi-year commitments.
The deal is high value or mission-critical.
You’ll share confidential info or create IP.
You need clear remedies: late fees, service levels, warranties, limitation of liability, termination rights.
You’re in different countries (governing law, court/arbitration, language, currency, tax).
Summary
Handshakes are often binding, but they come with great risk exposure. Are they a good business habit? A well thought through contract beats a long expensive lawsuit.
If you need to close a deal fast by a handshake, do the handshake plus and secure the deal by following up in writing. Remember that laws differ by country and contract type, and the person who claims a deal exists usually has to prove it. Author: Kat Strandberg Dubai 2025-10-26
Email: Kat@stgcommerciallaw.com