A contract is a legally binding agreement between two or more parties that outlines the terms and conditions under which they agree to perform certain actions or provide something of value. Contracts can be verbal or written, but written contracts are more common and usually considered more reliable as they provide clear evidence of the parties' intentions.
A contract typically includes several key elements:
Offer: One party makes a specific proposal or promise to do something in exchange for something else (e.g., payment, services, goods).
Acceptance: The other party agrees to the terms of the offer, indicating their willingness to be bound by the contract.
Consideration: Each party must receive something of value in return for their promise or performance. This is usually money but can be anything of value.
Legal capacity: Both parties entering into the contract must be legally competent and capable of understanding the terms and implications of the agreement.
Mutual consent: Both parties must willingly and voluntarily agree to the terms of the contract without any coercion or fraud.
Legality of purpose: The contract's purpose and the actions it entails must be legal and not against public policy.
Contracts can cover various types of agreements, such as employment contracts, purchase agreements, lease contracts, service agreements, and more.