Contracts
- By Mominur Rahman
- Published 16 October 2006
- Law
- Unrated
Essentials of a Valid Contract
In order to be an enforceable contract, there must be
1. An agreement
2. Based upon the genuine assent of the parties
3. Supported by consideration.
4. Made for a lawful object.
5. Between competent parties.
These requirements of valid contract may be analyzed into the following elements, all of which must be present:
1. Proposal or offer by one party and acceptance of the proposal or offer by another party, resulting in an agreement- consensus ad-idem.
2. An intention to create legal relationship or an intent to have legal consequences.
3. Genuine, (i.e. free and real) consent between the parties (i.e. not marred by mistake, undue influence, coercion, fraud or misrepresentation).
4. The parties to the contract are capable of contracting.
5. The object contracted for is legal and is not opposed to public policy.
6. There are at least two persons to make the contract.
7. The agreement is supported by lawful consideration (or, under English law proper form is used).
8. The agreement is capable of being perform.
9. The terms of the contract are certain.
Contracts arise under a wide variety of circumstances. They may arise from face to face conversation or from conversations by telephone, from the exchange of letters or telegrams or by any other means of communication. When the contract is part of a common business transaction, a printed form is often used. In such a case, all that is usually necessary to complete the contract is to add the date, the names of the parties, the price, the particular performance or commodity which is the subject matter of the contract, and signatures of the parties. Familiar types of standard contract forms are leases and the various forms used for the installment purchase of motor vehicles, refrigerators, radio sets etc. Some times the contract must comply with certain standards. For example, the may require particular contract to be in writing, such as an arbitration agreement.
1. An agreement
2. Based upon the genuine assent of the parties
3. Supported by consideration.
4. Made for a lawful object.
5. Between competent parties.
These requirements of valid contract may be analyzed into the following elements, all of which must be present:
1. Proposal or offer by one party and acceptance of the proposal or offer by another party, resulting in an agreement- consensus ad-idem.
2. An intention to create legal relationship or an intent to have legal consequences.
3. Genuine, (i.e. free and real) consent between the parties (i.e. not marred by mistake, undue influence, coercion, fraud or misrepresentation).
4. The parties to the contract are capable of contracting.
5. The object contracted for is legal and is not opposed to public policy.
6. There are at least two persons to make the contract.
7. The agreement is supported by lawful consideration (or, under English law proper form is used).
8. The agreement is capable of being perform.
9. The terms of the contract are certain.
Contracts arise under a wide variety of circumstances. They may arise from face to face conversation or from conversations by telephone, from the exchange of letters or telegrams or by any other means of communication. When the contract is part of a common business transaction, a printed form is often used. In such a case, all that is usually necessary to complete the contract is to add the date, the names of the parties, the price, the particular performance or commodity which is the subject matter of the contract, and signatures of the parties. Familiar types of standard contract forms are leases and the various forms used for the installment purchase of motor vehicles, refrigerators, radio sets etc. Some times the contract must comply with certain standards. For example, the may require particular contract to be in writing, such as an arbitration agreement.
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Article Series
This article is part 1 of a 2 part series. Other articles in this series are shown below:
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Contracts