Common Law And The Uniform Commercial Code

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When running a business, the most common legal transactions you will be involved in is a business contract and despite what type of business a person runs, by having an understanding of contract law is a key to creating sound business agreement that will be enforceable legally incase a dispute arises (Find law). Normally, contracts are governed and enforced by the law in the state in which the agreement was made but depending on the subject matter of the agreement such as property lease and sales of goods thus a contract may be govern by either one or two types of state law, namely; The common Law and The Uniform Commercial Code (UCC). The Common Law; The majority of contracts based on employment agreement, lease and general business…show more content…
Creating a Contract A legal contract arises when there is an offer, acceptance of that offer and also a sufficient consideration to make the contact valid. There are five essential elements that make a contract legal and these includes; 1. Intention to create legal relations When it comes to commercial transaction, it is generally presumed that the contracting parties must have the intention to create a legal binding contract. This simply means that if the parties signed a contract for business related activities, then in case the other party fails to fulfill the contractual provision then the other party will be able to sue the other party. 2. An offer;- An offer allows the person or business to whom the offer is made to, to reasonably expect that the offering party is willing to be bound by the offer based on the terms proposed thus these terms of an offer must be define as well as certain. 3. Consideration; This is a legal term that is given to the bargained for exchange between the parties in which a contract is made. This can be something of some value that is passed from one party to the other. In addition each party of the contract will gain some benefit from the agreement as well as incur some obligation in exchange for the benefit received. 4. An acceptance; This is a clear expression of a party accepting agreement to the terms of the offer. 5. Capacity (the authority or ability to make contracts) A person who is below 18 years of age and lunatics
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