No oral side agreements exist. But they do!

Background

So-called entire agreement clauses, for example:

• “No oral side agreements exist”,

• “No oral side agreements have been made”, or

• “Oral side agreements do not exist”

are intended, whether they are included as standard terms or individually negotiated, to confirm that the written contract contains all of the provisions the parties have agreed on with respect to the subject matter.

The German Federal Court of Justice (Bundesgerichtshof, BGH) has settled that such clauses merely restate the presumption of completeness and accuracy of the written contract that already applies in any event. They leave the party that wishes to rely on a different oral agreement the option to provide counter-evidence.

The case

A day-care provider leased commercial premises in a historic post office building. Section 3 of the lease read: “The landlord will freshly renovate the premises before the start of the lease as agreed.” Section 14 contained both of the provisions such contracts usually contain: “No oral side agreements to this contract exist,” and a written-form requirement for amendments.

The tenant never paid the full rent, citing defects, and relied on an oral promise of additional glazing for the windows. The landlord pointed to Section 14 and sued for around 43,000 euros in arrears.

Case law

According to the BGH, an entire agreement clause cannot establish an irrebuttable presumption that no oral agreements exist. Nor can such a clause be read to mean that arrangements made during the pre-contractual negotiations no longer hold.¹ It was precisely the phrase “as agreed” in Section 3 that showed the parties did not intend to walk away from their pre-contractual arrangements. The tenant’s appeal succeeded: the appellate court had made no findings at all on the alleged promise and must now do so.

Whether the clause is also invalid as a standard term depends on what it is meant to achieve. In the same decision, the BGH notes in passing that a form clause aiming at an irrebuttable presumption would be “invalid in any event” in light of Section 305b, Section 307, and Section 309 No. 12 BGB. The plain clause does not aim at that: it merely restates the legal position and is therefore valid.² That is the real finding. A party who writes “No oral side agreements exist” into its standard terms does not have an invalid clause – it has a clause that does nothing.

The sister clause

The second sentence of Section 14 is the more common case in practice: amendments require written form. In its strictest version, the double written-form clause, even waiving the written-form requirement is supposed to require writing. That does not help either. The BGH left open whether such a clause is valid at all; where it is agreed as a standard term, it is in any event ineffective because individual agreements take priority.³ Individual agreements prevail regardless of form, including orally and by conduct, and even where the parties never gave the clause a thought. It is different only for a double written-form clause that was individually negotiated: there it matters whether the parties deliberately intended to override it.

What is at stake is shown by the same case. Over the years, storage space contractually designated for fabrics and haberdashery had informally become a beverage business, blessed by letters of confirmation and by acquiescence. Because that change of use was material and failed the written-form requirement of Section 550 BGB, the fixed-term lease counted as concluded for an indefinite period and could be terminated on ordinary notice. The tenant had to leave.

A look at England

The same illusion, in a different place: in August 2025, the Court of Appeal held that two media companies were already bound on the broadcasting rights to the FIFA Club World Cup by two emails. An offer of 1.7 million US dollars, and a reply expressly accepting it and noting that contract drafting would now begin. That a formal contract was to follow changes nothing where the parties have agreed all essential terms. A party that does not yet want to be bound has to say so: “subject to contract,” or an equivalent formula. These parties had not used it, even though the licensor was familiar with such wording from other negotiations (DAZN Ltd v Coupang Corp [2025] EWCA Civ 1083).⁴

In both jurisdictions the same attempt fails – the attempt to confine the contract to the paper. In Germany it fails on the priority of individual agreements; in England, on the fact that the reservation has to be spoken while it is still worth something.

Notes

1. BGH, judgment of 3 March 2021 – XII ZR 92/19. ↩

2. To the same effect Friedrich Graf von Westphalen, AGB-Recht im ersten Halbjahr 2021, NJW 2021, 2328 (para. 14): the entire agreement clause is purely declaratory, and either party may adduce counter-evidence. ↩

3. BGH, order of 25 January 2017 – XII ZR 69/16. ↩

4. For a German-language report on the decision, see Klaus Vorpeil, Neuere Entwicklungen im englischen Handels- und Wirtschaftsrecht, RIW 2026, 93, 93 f. ↩

Reference: Poleacov, P. (2026). No oral side agreements exist. But they do!. INN.LAW. https://inn.law/en/perspectives/entire-agreement-clause/

---