What is a major disadvantage of an oral contract?

An oral contract often leads to misunderstandings or disputes because there is no physical record of the terms agreed upon. This makes it challenging to validate the specifics of the agreement, as each party may have a different recollection of the terms and conditions. The lack of documentation means that if a disagreement arises, it can become difficult to determine which party has the accurate memory of what was discussed. This scenario can result in a situation where one party believes the agreement is one thing, while the other party believes it is something else entirely.

In contrast, the other options either misrepresent the nature of oral contracts or exaggerate their limitations. For example, oral contracts can indeed be legally binding if they meet certain conditions; thus, they are not devoid of legal standing, nor do they require witnesses to be valid. The central issue with oral contracts lies in the ambiguity and difficulty in providing proof of the terms, making it imperative for parties to consider written contracts for clarity and enforceability.