This is a difficult question to answer without having any background knowledge on what transpired in the run up to this verbal agreement. Certainly a verbal agreement to sell a business would be binding and enforceable. Despite the obvious dilemma of proving the agreement (his word against yours type of thing), there are a couple of other issues.
First and foremost, you need to absolutely sure there was a solid agreement. For a contract (verbal or otherwise) to exist, the following elements must exist:
1. There must be a meeting of the minds. In other words, the parties to the contract must be in agreement with the essential elements of the contract. For instance, the parties must be certain on what is bought, for how much, when it is to be paid, who sells and who buys.
2. There must also be a clear intention to contract with each other. This is where things are not clear in your situation. Was it the intention of the parties to conclude the contract on a handshake and then just put the agreement in writing, or was it the intention of the parties to only make the agreement valid once they are in possession of a written contract signed by all concerned. In other words, when you stood up from the table, did everybody there see it as a done deal, or was the gist that we will decide finally once we have the written agreement. If it is the former, then you would have a case to hold him to the agreement. If it was the latter, it is going to be more unlikely that you could sue him for specific performance.
3. The contract must not be for an unlawful or immoral purpose and
4. The formalities for that particular contract needs to be adhered to. For instance, a contract for the sale of a house legally has to be in writing, signed by everybody and contain certain specific terms.
So, in summary, the whole issue hinges on what as discussed in paragraph 2.
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