This website uses cookies to ensure you have the best experience. Learn more

Essential Elements Of Valid Contract Essay

1145 words - 5 pages

Essential Elements for Valid Contracts
By: M.H.M.Rishardh
MBA, BBA (Hons), FCMI (UK), MCIM (UK), Member of AMA (USA). MSLIM, MIM (SL)

Learning Outcome:
On successful completion of this topic you must be able to

* Understand the essential elements of a valid contract in Business Context
Contracts that meet all legal requirements are valid and enforceable, which means that either party can hold the other party responsible for his or her agreement.
1. Offer and Acceptance
To have a valid contract, there must be a meeting of the minds (mutual assent), nominally evidenced by an offer and acceptance.
An offer is made by an offeror and expresses that person's ...view middle of the document...

It is a legally
binding relationship between two or more people that is enforceable by law.
Essential Elements of a contract( Must be learned)
1. Offer
2. Acceptance
3. Consideration
4. Intention to contract
5. Capacity to contract
6. Consent to contract
7. Legality of form
8. Legality of purpose
Offer: An offer is a proposal to give or do something and, when accepted, there is said to be an agreement. It must be clear and may be implied by conduct e.g. taking goods to the checkout.
Acceptance: This is a positive unqualified assent to all terms of the offer e.g. a house
buyer makes an offer of price for a house and seller is happy to accept.
Consideration: This refers to whatever is exchanged between the parties.
-It must be real
-It need not be adequate
-It must be legal
e.g. The staff at the Beckham wedding signed a contract of silence in which the consideration was agreed at a €1. This was never paid which means a valid contract did not exist.

Intention to Contract: The Person must want to create legal relations. Therefore the parties signing a contract must know that they are entering a legal agreement that cannot be broken
Capacity to contract: This is the power of a natural person to enter into a contract. The following parties do not have the capacity to enter a contract.
1. Minors- people under 18 except for necessities e.g. food
2. Persons under the influence of alcohol or illegal drugs
3. Persons of unsound mind.
Consent to Contract: A person must enter into a contract of their own free will.
There should be no use of force or lies. e.g. a groom only married his pregnant wife after he was threatened by her father. One month later the marriage contract was cancelled.
Legality of Form: This refers to the manner in which the contract is made. It can be oral ( simple contract) or written. E.g. when buying a house a contract must be written.
Legality of Purpose: This means that legally binding contracts can only be for legal transactions.
E.g a judge will not award compensation to a bank robber whose getaway driver did not show up as agreed!!
NB: Invitation to treat is not the same as offer- An invitation to treat invites a person to make an offer to buy...

Other Papers Like Essential Elements of Valid Contract

Edexcel Assisgnemnts Essay

1117 words - 5 pages approach to study and research has been applied | | | |to find appropriate solutions | |while explaining the importance of essential elements required | | | | | |for the formation of a valid contract, impact of different types

‘the Law of Contract Confines Itself to the Enforcement of Voluntarily Created Civil Obligations’-Illustrate and Explain

2709 words - 11 pages Law (CL) and theory are voluntary in nature in its core.A contract consists of essential elements which form the basis of the contract. The very first step contains offer and acceptance or mutual assent. Mutual Assent is established through an offer made by one party to enter into the contract and acceptance of the other party to enter the agreement.The next step is consideration which is a benefit or something which is of value to both the

Critical Analysis

1042 words - 5 pages Critical Analysis BUS311: Business Law 1 July 25, 2011 The elements of an enforceable contract must contain six elements: offer and acceptance, mutual agreement, consideration, competent parties, legality of purpose, and proper form. Contracts may be classified in several ways, depending on the manner in which they are created, expressed, or performed. Thus a contract may be either oral or written; it may be express or implied

Bus 311 Critical Analysis Paper Business Law I - Contract ( Apa, W Citations, References, & Abstract)

2580 words - 11 pages operation of a business are very important and it is done through analyzing identifying all the legal issue and elements of a contract. Offer and Acceptance The most important feature of a contract is that one party makes an offer and for an arrangement to be reached that the other party accepts. After a valid offer has been made the two parties should ask to enter a defined contractual agreement. To make sure an offer of the house price is

Business Environment

1864 words - 8 pages /601/0563 Number 1 Learning Outcomes Covered: Outcome1:Understand the essential elements of a valid contract in a business context Outcome2: Be able to apply the elements of a contract in business situations Outcome3:Understand principles of liability in negligence in business activities Outcome4: Be able to apply the principles of liability in negligence in business situations Assessment Criteria Covered: 1.1 , 1.2, 1.3 2.1, 2.2

Law Contract Case Study

1007 words - 5 pages Case 1 Issue This problem addresses the issue of agreement, whether there is a valid contract or the offer may be terminated. In order to the contract being valid and enforceable, there is a need for the conduct of an offer and an acceptance. Rule For an offer to be valid, it contains some rules, including lapse of time. When an offer is made, it does not last forever. An offer stated to open for a specific period, lapse if the there is no

All Contracts Are Agreement but All Agreement Are Not Contracts

1863 words - 8 pages together are not contracts because they are not likely to create a duty enforceable by law for the simple reason that the parties never intended that they should be attended by legal consequences Essential Elements of a Valid Contract A contract has been defined in section 2(h) as "an agreement enforceable by law." To be enforceable by law, an agreement must possess the essential elements of a valid contract as contained in sections 10, 29

Samuel DaGroass And Others Were Planning To Open A Restaurant. At Some Point Prior To August 1985, DaGroass Orally Agreed With Philippe LaJaunnie That LaJaunnie, In Exchange For His Contribution In...

644 words - 3 pages Untitled "A contract is an agreement that can be enforced in court. It is formed by two or more competent parties who agree to perform or to refrain from performing some act now or in the future," (Miller 229). The elements of a valid contract are agreement, consideration, contractual capacity, and legality. However, even if the contract consists of all those four elements, the contract may become unenforceable if it's

Aspects Of Contract And Negligence For Business

4339 words - 18 pages Negligence for Business | Table of Contents Introduction 1 Task 1: Understand the essential elements of a valid contract 2 P1.1 The importance of the essential elements required for the formation of a valid contract 2 P1.2 The impact of various types of contract 4 P1.3 Analysis of terms in contract with reference to their meaning and effect 5 Task 2

Mange and Business

1992 words - 8 pages Offer The first element in a valid contract would be offer. An offer or a promise or an agreement needs to be in contract because if there is no offer than there will be no contract. In the Contracts Act, 1950, the first elements in a contract would be offer. It is one of the elements to make sure that the contract is legally valid or acceptable. In a contract, it is very important that a party would make an offer. There is a difference of

Contract Creation And Management

963 words - 4 pages cover how the contract formation was achieved, whether the contract should have been administered, the contract dispute resolution methods used, and the lessons learned from the scenario. Contract Formation Valid Enforceable contracts require four basic elements. The elements are agreement between the parties, some form of payment or consideration for the agreement, both parties have contractual capacity, and the objective of the agreement is

Related Essays

The Essential Elements Of A Contract And The Applicable Remedies In The Event Of A Breach

3010 words - 13 pages Business I. The essential elements of a contract and the applicable remedies in the event of a breach. Four Essential Elements of a Contract An agreement must contain four essential elements to be regarded as a contract. If any one of them is missing, the agreement will not be legally binding. a. Offer There must be a definite, clearly stated offer to do something. For example: A quotation by sub-contractor to the main contractor and an

Elements Of A Contract Essay

1305 words - 6 pages typically a short summary of the contents of the document.] | After considering Apple’s Retail Store Sales and Refund Policy it is clear that the form is a valid and enforceable contract. In order to have a valid contract an agreement, consideration, contractual capacity, and legality must be present. Apple’s Sales and Refund Policy has all four elements of a valid contract. There is an

Elements Of A Contract Bus670 Legal Environment

2066 words - 9 pages Elements of a Contract Nicole Castro BUS670 Legal Environment Prof. Robert Tocker September 2, 2013 A contract of employment is a type of a contract used in labor law to attribute rights and responsibilities between parties to a contract (Blum, 2007). On the one end stands an "employee" who is "employed" by an "employer". A written employment contract is a document that someone and their employee sign which sets forth the terms

Valid Contract Essay

1025 words - 5 pages Course: Name Valid Contract Yours Name Professor’s Name [optional] University Elements for a Valid Contract to exist A valid contract does not need to be legally valid, it can be written in simple English and fulfill the needs of all the parties involved in that contract. Although, a contract may not be legal but it should be a written contract so that future issues can be settled on the basis of the written agreement signed by the