Contracts Checklist

There are many parts of a contract that we think of naturally for an agreement to be binding. However, for some reason, many times we skip certain parts of the contract. Here are the basics of what is required to have a contract upheld in a court of law.


1. Offer and Acceptance

There must be a clear, unambiguous offer to another party, with the intention to be bound by that offer. Depending on the type of offer, or what is being offered, the contract may be required to be in written form.

The acceptance can take many forms, including communicating acceptance, actions which represent acceptance, or the signing of a document. Some states even allow email to represent acceptance.

2. Consideration

There must be consideration given by all the parties involved in the contract. This means that each party must confer, offer, or give a benefit on the other party or sustain a recognizable detriment in the present or future. It is not allowed to enter a contract based on past services, offers, or actions.

3. Competence

All parties signing the contract and to be bound by the contract must be competent at the time of signing. If one of the parties is not considered a legal adult (a minor), is mentally disabled, or an animal, the contract will at a minimum be voidable, and most likely be void.

4. Lawful

No contract to undertake illegal actions is valid, regardless if all the other premises or purposes are met.

If all of these elements are met, more likely than not you will have a valid contract.