Many written contracts contain a provision to this effect: No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto.
Is this type of provision enforceable?
In many instances, the answer is “no”.
In Mississippi, “an oral modification may be made even where the contract provides that modification must be in writing.” Eastline Corp. v. Marion Apartments, Ltd., 524 So.2d 582, 584 (Miss. 1988).
The general rule is that, in the absence of a law which requires the particular contract involved to be in writing, the parties to a written contract may afterward change or modify it by verbal agreement. St. Louis Fire and Marine Insurance Co. v. Lewis, 230 So.2d 580, 582 (Miss. 1970).
At the same time, “for a subsequent agreement to modify an existing contract, the later agreement must, itself, meet the requirements for a valid contract.” Singing River Mall v. Mark Fields, Inc., 599 So.2d 938, 947 (Miss. 1992).
Put another way, “since a contract modification must have the same essentials as a contract, a binding post-contract agreement must fulfill the requirements of a contract regardless of whether a party characterizes it as a modification or a stand-alone contract.” Singing River Mall.
A modification may also arise from the parties’ conduct. “The subsequent actions of parties pursuant to a contract may support a finding that the original contract has been modified to an extent consistent with the subsequent course of conduct.” Fletcher v. U.S. Restaurant Properties, 881 So.2d 333, 337 (Miss. Ct. App. 2004).
The implications of the statute of frauds.
In Mississippi, many oral agreements are just as legally binding as a written contract.
But, the “statute of frauds” refers to contracts that must be in writing in order to be enforceable. Some of those contracts are listed in Section 15-3-1 of the Mississippi Code, but others can be found in different Code sections.
If the contract is question is subject to the statute of frauds (and, therefore, must be in writing), then any amendment to that contract must usually be writing as well. See, e.g., Favre Prop. Mgmt. v. Cinque Bambini, 863 So.2d 1037, 1045 (Miss. Ct. App. 2004) [“Because a contract to purchase land is within the purview of the statute of frauds, any modification of a contract that comes under the statute of frauds must be in writing”].
The better practice, of course, is to put in writing any amendment to a written contract.
Panter Law Firm, PLLC, 7736 Old Canton Road, Suite B, Madison, MS 39110