Contracts are legal agreements that take place between two or more parties. These legal contracts must have some key elements in order to be enforced in court. Let’s discuss 5 most important elements of any contract specifically in contracts for services, sale contracts, rental contracts, lease agreements, employee contracts and so on.
Contract offer
Every contract starts with an offer in which one party describes all desires and tasks that it wants to be done by another party and in return states all benefits or specific money it will give to another company if the offer gets accepted. Offer is not only about getting services by means of money but it also includes exchange of products, goods, property and so on. When any company or party receives an offer, this is totally their choice to reject, accept or extend that offer. In this step, both parties are capable of doing bargaining in every sense.
Acceptance of offer
Next key element of contract is acceptance in which the offeree accepts the offer under all terms and conditions. It can be verbal or written but the most authentic way is written contract acceptance so that in any case it can be enforced in court. Accepting an offer requires some actions from an offeree to indicate either an offer is accepted or rejected. When an offer is accepted by the offeree and the contract is done, the court will look these factors for evidence:
1: Offeree intentionally entered into the contract.
2: Offeree accepted all the terms and conditions suggested by the offeror.
3: Offeree communicated with the offerer for the acceptance.
Consideration
In order to make a valid legal contract or agreement, something must be exchanged. Generally, things like goods, products, property or services. It’s important to understand that to make any consideration valid there does not need to be a financial component. An agreement of exchange of anything is enough to meet the legal significance of consideration.
Contractual Capacity
This element simply can be described as, contract law requires all signatories to indicate that they can clearly understand the terms and conditions of agreement before signing the contract. Specifically, some people have no legal capacity to validate a contract. For example, children less than 3 years old, people with brain disorders, people who use drugs and alcohol oftenly or people having language issues.
Contract legality
A contract would be illegal if the agreement refers to an illegal purpose. So every contract or agreement should not violate law. Such contracts that deny public policies are also vulnerable to issues of enforceability. For example, a contract to deceive the inland revenue department or contract for murder, both are illegal and unenforceable.