There are circumstances where entry into a contract can be proved by oral conduct.  However, it is critical that a party relying on an oral promise or representation to support the entry into a contract produces contemporaneous documents which supports the oral conversations between the parties.

In the recent Court of Appeal decision of Rowson v Alpass [2026] VSCA 120 (4 June 2026), the Court of Appeal found that the Associate Justice in the lower court (Rowson v Alpass (no 23) [2024] VSC 169) had not erred in finding that no agreement was reached between the parties based on oral discussions between the parties.

1. The relevant dispute concerned the purchase of a legal practice:

• Alpass was the receiver of the law practice known as Hardys;
• He had received an offer to purchase the practice;
• The central issue was conversations conducted during a meeting in person between Rowson (and his business partner, Nelson) and Alpass and a phone call on that same day – those conversations were central to the issue as to whether a contract was formed;
• Alpass took file notes of the conversations – his usual practice was to take file notes of every conversation he had with different parties;
• Discussions conducted by Alpass with a representative of the Victorian Legal Services Board determined which potential purchaser was a suitable candidate based on practising certificates held by those parties – there were issues with Nelson’s practising certificate which would be required for Rowson to conduct the practice;
• Rowson set up a company and relied on that step as indication he had an agreement to purchase the practice;
• The proceedings below were delayed as a result of the death of Nelson, and Rowson was in prison between 2018 and 2022;

2. Rowson’s position was that the agreement fell within the first category of agreements described in Masters v Cameron being that category in which parties intend immediately to be bound by the terms of their bargain but propose to have their terms restated in a fuller and more precise form, to the same effect;

3. The relevant legal question before the Associate Justice was whether, viewed objectively, an intention to enter into a binding agreement could be ascertained from the words and conduct of the parties;

4. Despite Rowson’s criminal history, the Associate Justice found that he was an impressive witness and there was nothing about his demeanour that suggested he was not telling the truth; However, there were inconsistencies in his evidence that cast doubt on the credibility and reliability of his evidence;

5. The Associate Justice had no concerns about the reliability of Alpass’ evidence and that his file notes were very good and were contemporaneous notes of discussions which did not record an offer to purchase the practice;

6. The Court found that there was no error in the finding by the Associate Justice that there was no contract made between the parties – there was no intention to enter into a binding agreement that could be ascertained from the words and conduct of the parties – an offer was made by Rowson but it was not accepted by Alpass;

7. The file notes were consistent with both parties’ evidence – the file note of Alpass noted that Rowson would get back to him tomorrow. Had an offer been made, it can be expected that Alpass, an experienced solicitor, would have recorded that important fact;

8. The associate judge found that Alpass had engaged in conduct which induced Rowson to believe that he and Nelson would acquire the Hardy’s business, but that Rowson’s claim based upon promissory estoppel failed because he had not suffered any detriment, material or otherwise, as a consequence of any mistaken belief he held. The Court of Appeal found that there was no detriment suffered by Rowson and he did not lose any opportunity.

Accordingly, when a party seeks to prove entry into a contract and relying on oral conduct, there will be substantial evidence required from witnesses and whether there are contemporaneous documents (such as emails, file notes and text messages) which can support the existence of a contract.  Contractual disputes can be contentious and may not always be evidenced by written documents – parties should record conversations in as much detail as possible, even if it is not an exact transcript of the conversation.