One of the core elements of law is the drafting of contracts. In a society based on law, the contract is a key means by which people enter into legally-binding agreements. This permits society to operate lines-of-credit, lease agreements, and more. Contracts enable progress.
What is Contract Law?
Contract law is a specialty of law which centers on the drafting of contracts and agreements. Most business today involves formal agreements between parties to ensure that deadlines are met and standards are maintained. Contracts may be simple or complex, depending on the scale and scope of the project.
The lawyer who handles contracts will create an agreement which will hold up in court should either side violate the terms.
What are the Types of Contracts
Types of contracts depends in part on whom is being asked. In general, there are four types of contracts. These are:
- Standard Form
The written contract is just as it indicates…it is written. A key benefit of this is that it is written. Any questions of fact related to the agreement are there in writing for anyone to read anytime.
A verbal contract is not written, but rather is an agreement or contract which is agreed-upon verbally by the parties. Verbal agreements remain valid but when suing in a court of law, proving the elements of the agreement can be difficult.
Standard Form contracts are just that…standard forms which contain blanks for information as needed in the agreement. These are commonly used in insurance policy applications, equipment rental agreements, car rentals, and similar transactions.
The Period contract is most often used among contractors, those with a temporary need for access to work sites and other restricted locations, and others for whom a limited-time agreement would be useful.
What are the Elements of a Contract?
As mentioned, there are four types of contract, but regardless of the type, the elements are the same. These are:
- Offer – one party has made a promise to be fulfilled at a later date
- Consideration – something of value will be exchanged should the offer be accepted
- Acceptance – the offer has been accepted
- Mutuality – both parties agree to the terms of the contract
What Should be Included in any Contract?
No matter the type of contract, the four elements must be present, but there is more.
To be legally-binding, both parties to the contract must be of sound mind, with the legal capacity to conduct business on their behalf. In addition, the contract itself must be legal. Finally, both parties must sign the agreement either before witnesses or a notary public. Signing in front of your attorney is strong.
On a note regarding the legality of the contract. We often see cases where a new client attempted to draft their own contracts using one of those online template portals only to find the contract unenforceable because it was declared illegal.
This happens because the laws are constantly changing. A single change months before the system is updated and the contract is null and void. At AARLaw, this does not happen because we carefully research every applicable law before custom-drafting the agreement.
What is Required for a Contract to be Legally Binding?
In the days of the old West, our forefathers would say all that was needed for a contract to be binding was spit and a handshake. Many of us are thankful that times have changed a bit.
The two most important elements needed today for a legally-binding contract is sound-ness of mind and legal signatures. Of course, the contract itself must be legal, that is, based on the law as it was written at the time of signing.
What Can be Done if a Contract Has Been Broken?
If a contract has been broken, the injured party has two options, depending on what has been written into the contract.
The first option is to let the breach go. Sure, discuss it with your partner or contractor, but if a small slight, it may be best to forget it and move on. If the breach is not so small, perhaps involving large sums of money, it may be time to call a professional.
One of the things we do for our clients here at AARLaw is represent them in contract disputes and contract negotiations. Two things will affect the outcome of your case: Is Arbitration or Mediation required in the contract and can you prove the contract was broken, causing you injury.
Do I Need a Lawyer to Write Contracts?
No. There are plenty of do-it-yourself legal contract kits online for a fraction of what it will cost for you to hire an attorney to write your contracts. But, as with most things in life, you get what you pay for.
If you want your contracts written right,
if you want them to favor you should an issue arise, and
if you want them to be sound, lawful documents which cannot be challenged in court,
you want AARLAw.
Why Not Contact Us Today.