Is a verbal agreement between business partners in Malta legally binding?

Verbal agreements can be legally binding under general Maltese contract law principles found in the Civil Code, Chapter 16 of the Laws of Malta, provided the essential elements of a valid contract are present, such as genuine consent, a lawful object, and capacity to contract, but proving what was actually agreed becomes significantly harder without any written record, especially once the parties disagree on the details. Once your business was formalised into a company under the Companies Act, Chapter 386 of the Laws of Malta, the company's own memorandum and articles of association, and any formal shareholders' agreement, would generally take precedence over informal prior verbal understandings regarding matters like profit distribution and decision-making authority within the company itself. Gather any indirect evidence that might support your version of the original agreement, such as messages, emails, or a pattern of how profits were actually handled early on, since this can help establish what was genuinely agreed even without a signed document. Going forward, it is strongly advisable to formalise the actual arrangement in a written shareholders' agreement to prevent this kind of dispute recurring.