What Constitutes a Verbal Contract?
I’m 1/3 of a lawyer. I’m not your lawyer, don’t take my advice, get a real lawyer, blah blah blah. At the very basic level, you’ve made a binding oral contract. There’s been an offer and acceptance to trade services for payment. However, contract law has been made up largely of people who have tried, successfully or not, to weasel out of contracts, both good and bad. There’s a lot of weasel room here. It helps if there’s been no reliance on your offer. Even if there has been reliance, if the change in the value of the equity has been significant, you can argue that the circumstances have changed to the point of materially altering the bargain. Since it sounds like they’re not really holding your feet to the fire yet, see if you can duck out of doing the work, find somebody else to take it (if you find someone else, they probably won’t care that you’re backing out), or offer to do it for money. Sounds like things are pretty informal at this point, so you can probably resolve things amic
No, it was a verbal agreement. People back out of them all the time. Tell them that a year has passed without actualization of the agreement and that you would like to work out a new agreement based on your own pre-existing feelings. Once these are brought to the surface, they will probably tell you no hard feelings and move on.
I think legally you won’t have much of a problem, but IANAL. If it’s just an oral contract, they’ll have to prove that you said you’d do such and such and everything else that others have discussed. Morally, however, you’re a total douchebag if you don’t pony up and do what you said you’d do. You knew full well when accepting the job offer in the first place that the equity in the company had a variable worth, and apparently you just banked on it being on the high end. Now you’re disappointed that it’s not. Would this be any different from taking a job at a certain rate of pay and then deciding you can’t work there any more if your local currency loses value? Why shouldn’t you keep your word?
Grouse (and jellicle), the Statute of Frauds probably doesn’t apply here. SoF’s one-year provision only applies to contracts which CANNOT be performed within a year. Whether or not the contract actually WAS performed within a year is usually immaterial. Courts don’t really like the one-year provision, and will usually try to bob and dodge to avoid torpedoing a contract on its grounds. Here, it looks like the programming could be done within a year, so the SoF doesn’t kill the contract.
Law.com’s dictionary definition of oral contract is helpful: An oral contract is often provable by action taken by one or both parties which is obviously in reliance on the existence of a contract. So, are they relying on your agreement to do the programming work? Also, was the agreement detailed enough to be acted on (i.e. program specifications, due date, amount of equity to be given)? The answers to these questions will give you a clearer idea of whether or not you have an oral contract. For what it’s worth, you are certainly able to decline to do the work; if the contract is valid and they sue you on it you’ll most likely just have to pay damages. IANAL.
