Contracts give the parties the certainty that their agreement is being respected or that they are entitled to damages for non-compliance with the agreement by the other party. They give security to our business relationships and encourage people to live up to their commitments. It is therefore important that contracts are drafted correctly so that they can be brought to justice. Never just think that a document you have copied from the Internet or a template provided by a non-legal source adequately protects your interests. The person making the offer must intend to be legally bound (Harvey v Facey (1893) and, for the acceptance to be valid, he must: an agreement between private parties that creates legally enforceable mutual obligations. The fundamental elements necessary for the agreement to be a legally enforceable contract are: mutual consent expressed through a valid offer and acceptance; take due account; capacity; and legality. In some States, the consideration element may be satisfied by a valid replacement. Possible remedies in the event of an infringement are general damages, consequential damages, damage to trust and certain services. Some types of contracts must be in writing. For example, real estate purchase contracts must be written to be enforceable. Contracts are concluded when an obligation arises from a commitment made by either party.
To be legally binding as a treaty, an undertaking must be exchanged for an appropriate counterpart. There are two different theories or definitions of reflection: Bargain Theory of Consideration and Benefit-Detriment Theory of Consideration. A legally binding contract can be concluded either in writing or orally. However, depending on the nature of the transaction, some contracts must be in writing to be considered legally enforceable. There are contractual clauses that are unclear or unknown to non-lawyers and that may affect the damages and remedies available in the event of a breach. Among these concepts, a modern concern, emerging in contract law, is the increasing use of a particular type of contract known as “membership contracts” or form contracts. This type of contract may be beneficial for some parties, since in one case the strong party has imposed the contractual terms of a weaker party. For example, mortgage contracts, rental agreements, online purchase or signature contracts, etc. .