Contracts And Agreements Are The Basics Of The Business World

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;

Objective to build legal relationship: Not all agreements end up in binding contracts that are backed by the court of law. This is due to the fact that not all agreements are made under strict or formal

A contract is a legally obligatory promise or set of promises (Bagley, C. 2013). If this promise is broken, either party involved can be legally responsible and take the other party to court. There are four basic elements in the creation of a valid contract. The first consist of an agreement between the parties involved, by an presented offer and acceptance. The second states that the parties’ promises must be supported by something of worth, known as consideration. The third advises both parties must have the ability to enter into a contract. The fourth element states the contract must have a legal purpose (Bagley, C 2013).

Contracts are an important part of everyday life. They are an essential part of business. As a student of a business law class, I will discuss in this paper several aspects of contracts. This paper will give a definition of a contract and the essential elements necessary to form a valid contract. It will briefly discuss breach of contract and the difference between a material breach and a nonmaterial breach of contract. Examples of legal and equitable remedies available for breach of contracts will be highlighted. Also, legal excuses for nonperformance or other grounds for discharge of contracts will be addressed. Finally, three types of common contracts personally and professionally encountered will be mentioned.

As stated in the Gould Commercial Code Section 2-207 subsection 1, “A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to

In order for a contract to be formed, there are various requirements. These are offer, acceptance, consideration, and the intention to create legal relations. A contract may also be terminated.

There are three main elements for the formation of a legally binding contract, intention, agreement and consideration. The requirement that requires discussion here is the existence of an agreement by the parties to enter into a legally binding contract.

The "something of value" may be either something that the person actually hands over (that they would not otherwise be obligated to hand over) or some right that they give up (that they would otherwise have been entitled to exercise). For example, if you agree to buy a car for cash, you agree to deliver cash to the seller, and the seller agrees to deliver the car to you. In that situation, there is legal consideration, or sufficient value, for the agreement to be enforceable. Another example is a mutual release of claims. Suppose you accidentally hit a parked car, and you agree to pay the owner of the car £500 in cash to settle. In that case, you agree to deliver cash to the owner of the car, and the owner agrees that he or she will not file a lawsuit against you. (In such a situation, always get a written release of liability, or "release," from the owner of the car to prove that you have settled up.) The consideration from your side is the cash, and the consideration from the owner's side is that he or she gave up the right to sue you for the damages. Although the owner didn't give up anything physical, there is consideration to support the agreement because the owner gave up a legal right. Source: (http://onlinelegalforms.com/legalforms/freedraftingtips.html#consideration) Dunlop v Selfridges (1915) Hol. Defined consideration as ‘An act or forbearance of one party or, the promise thereof, is the price

Acceptance is a final and unqualified expression of consent to the terms of an offer. An offer may only be accepted by the person to whom it is made unless an agent is authorized to accept on behalf of that person. In addition, an acceptance must be made in the manner requested or authorized by the offering party. If the party to whom the offer is made

Contractual agreement has always been viewed in terms of offer and acceptance. The universal principle to contract law has always been parties may get into an agreement in whichever way they deem fit and they are subject to certain terms as they choose. As far as legal requirements vital to their formation are binding contracts may be formed. Moreover a binding agreement may be manifested in terms of writing or in verbal form.

Consideration can be classified as one party expect to get benefit from other according to the act performed by parties with a contractual deal. The benefit can be something valuable such as product or service and not only the money. It can be divided into 3 type of consideration which is executed, executor and past consideration. Executed consideration defined as when the promise carried out and thus the act has been carried

The four elements of a valid contract are offer and acceptance, meeting of the minds, consideration and competent parties. The contract must cover a legal purpose or objective as well (Binder, 2012). The objective theory of contracts holds that contract formation is dependent on what is communicated, rather than what is thought by one of the parties (Barnes, 2008).

A contract is deemed formed and valid in the eyes of the law when all necessary elements for its formation are proven to exist by producing admissible evidence with respect to their existence. In this regard, the primary elements required under law to establish the existence of a contract are proposal, acceptance, intention to create a legal relationship, consideration, capacity, certainty and legality. If one of this elements does not exist, then it would be doubtful whether the transaction concerned is contractual in nature. According to the

The formation of an offer, acceptance and consideration are necessary. The Offer is a willing on terms from the offeror with an intention to be binding with the offeree. Creation of legal relations is a concept which states that an agreement is legally enforceable only if the parties may be intentionally considered to have it. Consideration, as a bargain of exchange promises, involved a promisor and a promisee. They must receive a benefit and each suffer a detriment.

The last requirement of a valid contract is that its provisions be legal. If a