When someone asks for something to be kept “off the record,” it’s usually regarding some kind of sensitive information that is meant to be kept private. You may have heard the phrase used during a journalistic interview, or perhaps in a private meeting with an employer in which intellectual property or trade secrets were being discussed.

But, even if the speakers agree their conversation will be off the record, certain elements of a valid contract must be in place for the verbal agreement to be legally binding and there’s still the possibility that one person won’t hold up their end of the bargain.

In this post, we explore two different options regarding the protection of sensitive information: a verbal “off the record” agreement and a written Non-Disclosure Agreement.

What Does “Off the Record” Mean?

The term “off the record” doesn’t actually have a universally accepted definition; however, it’s generally understood that this term refers to a conversation that is meant to be kept confidential. The phrase became commonplace in the 1930s when interview sources for news articles would be willing to talk, but didn’t want to be quoted by journalists.

For a conversation to qualify as being off the record, speakers must agree that the conversation will be confidential and the information will not be shared. If one party is not clear on this, or never intended to enter a confidential conversation, then free consent was not given (an important element of a legal agreement) and the decision to keep the conversation off the record may not be legally binding.

If you find yourself in a situation in which sensitive information is being discussed, remember that the conversation can be shared with others unless both parties expressly agree otherwise—and a verbal agreement alone can’t guarantee complete confidentiality.

When Does “Off the Record” Become a Legal Verbal Agreement?

There are five main elements of a valid agreement or contract:

  1. Offer and Acceptance: Something of value is offered by a party (in this case, sensitive information) and accepted by another.
  2. Consideration: A benefit which must be bargained for between the parties. Consideration is basically anything of value to the parties involved. It’s what the recipient gives to the information holder in exchange for the information.
  3. Mutuality: Also called intention, free consent, or a “meeting of the minds.” The parties both consent to the agreement without undue influence, coercion, duress, or misrepresentation of facts.
  4. Legal Purpose: The subject matter of the agreement must be lawful. For instance, a person can’t ask someone to sign a contract that requires the signer to commit a crime. A contract with an illegal purpose will be immediately void.
  5. Certainty of Terms: The contract terms shouldn’t be vague or misrepresented. A party who enters a contract that is vague or misrepresented can continue to rely on the contract if they choose to do so. Otherwise, they may choose to void the contract at any time.

A verbal agreement can be considered legally binding when all of these elements are present. However, in journalism, an “off the record” agreement won’t often qualify as a contract because one or more of the elements are missing.

What Happens When a Verbal Agreement is Broken?

Without a written document as evidence, the terms of the contract are much harder to establish and a court case will often be reduced to the word of one party against the word of another. As a result, it can be difficult to prove the details of the contract and whether or not both parties truly agreed to them.

If a contract is broken, the aggrieved party can bring a case for breach of contract to civil court where disputes between private parties are resolved. It’s not a crime to break a contract, but a party may seek legal remedies (such as damage, recission or specific performance) for any harm caused by the breach.

However, not all cases are brought to the courts. For example, in journalism, a reporter who includes information that was supposed to be “off the record” might not be sued, but could lose their professional credibility and the trust of their sources.

For this reason, an “off the record” conversation is more culturally binding than legally binding; while there is no contractual obligation to uphold, there is a professional reputation at stake. But, even if it were alleged that a contract was in existence, verbal agreements are hard to prove.

Ideally, it’s best to have a written agreement in situations where sensitive information must be protected.

Non-Disclosure Agreements

A Non-Disclosure Agreement (NDA), sometimes called a Confidentiality Agreement, is a document that protects information, ideas, trade secrets, and more from being shared by imposing contractual obligations. These documents are often used in business relationships in which confidential information is being discussed, like when an entrepreneur pitches an invention or product idea to a potential investor.

In recent years, a number of emerging examples show NDAs being used to protect the reputations of high-profile people and their affiliates. Yet, even NDAs and confidentiality agreements have their limitations.

While they can’t prevent someone from sharing confidential information, NDAs do act as a strong deterrent for anyone who has signed one because of the consequences outlined in the document if they were to leak the information that has been discussed. 

For instance, a clause in the NDA might say the wronged party is entitled to an injunction (court order) in the event of an information breach. In this case, the accused party would be prohibited from spreading the information until a hearing is set. Penalties for breach of a court order include fines, imprisonment, or both.  

Another limitation is the difficulty determining the monetary value of the damages incurred by a leak. Some damages are irreparable no matter how much money is paid out.

Regardless, a written NDA can be more effective in protecting sensitive information than a verbal agreement because it provides evidence of the terms of the contract and clearly identifies available remedies if the contract is broken.

Protecting Sensitive Information

There are numerous situations in which sensitive information is better kept confidential. Whether it’s a journalist protecting a source or a business protecting its operations, verbal “off the record” agreements and written NDAs are meant to ensure the security of all the parties involved.

However, without a written agreement, it’s much harder to establish a contract was ever in place. Also, it’s important to remember that certain elements of a legal contract may easily be missed when forming a verbal agreement. So, an NDA is the more responsible option because it provides certainty, clarity, and consequences in a written contract.

It makes sense for these agreements to be used more frequently in a time when access to information has never been easier and privacy concerns seem to be around every corner. Still, it’s important to understand the legal workings and limitations of these agreements to ensure your information is properly protected.

Posted by Jasmine Roy

Jasmine has been writing for LawDepot since 2018. She is a writer with a passion for politics, law, and sociology. She's particularly interested in writing about real estate and family law.