What elements must be present to have a legally binding contract?

Question

What elements must be present to have a legally binding contract?

Answer 1

Elements needed to have a valid and legally binding contract are:
1. There must be at least two or more parties involved (a person cannot enter into a contract with himself),
2. The parties must have legal capacity (mental or physical ability),
3. A manifestation of assent by all parties involved to the contract (each party must accept all of the terms in some way), and
4. Consideration that supports a legal and enforceable promise.

Answer 2

A contract (means the same as "agreement") exists whenever one person agrees to do something for someone else. A contract can be as simple as, "meet me at the cafe and I'll buy you a coffee" or "whoever writes the best essay on dogs wins a trip to the dog show." It can be as complex as the type of contract together for the construction of a large shopping mall. The essence is AGREEMENT. Without agreement, there is no contract.

In most (but not all) cases, there must be an offer and acceptance of the offer that was made, plus each party must give to the other something of value (that's called consideration). A contest is one exception to the need for consideration and communicated acceptance. Sometimes, people's conduct towards each other can give rise to a contract.

To be enforceable, the contract cannot be illegal. For example, you could not sue someone for breach of a contract to kill someone.

In some cases, to be enforceable, a contract must be in writing and sometimes there are required terms. Required terms are usually imposed to protect weaker parties (such as residential tenants) from stronger parties (their landlords).

All told, while your question sounds straightforward enough, to give a proper answer would require a great deal of time and detail, of the sort that one studies in law school and fights about for the rest of one's legal career ;o) I suggest you ask a more specific question -- describe a set of circumstances and then ask whether a contract arises and, if so, what are its terms. You should also say where you are, as the law varies greatly from place to place.

Answer 3

If I recall, under British common law and the codes of law which have been so derived, a contract is an agreement which has: Intention to create legal relations Consideration If an agreement has those two things and is not in violation of any laws or precedents, then it's likely a legally binding contract.

Answer 4

"CarolinaShygirl" nailed it, but perhaps I should explain what "consideration" means, since most laypeople don't understand the concept.

A contract is just an agreement. What makes it binding is NOT the signature (someone already said that you can have an oral agreement in some cases) -- what actually makes it binding is that something of value (your time, money, your personal effort, an object, etc.) has changed hands with the "reasonable expectation" of getting something in return.

If I agree to paint your house, one could argue that we really don't have a contract yet until I begin work (time & effort), or you give me an advance (money), or I cancel some other job in the expectation of working for you (reliance).

Answer 5

One does NOT need it to be in writing, but it's better if it is.

You need to have at least have a verbal agreement of some type. i.e. each pay 1/2 rent, 1/2 light bill, etc.

That's pretty much it. A verbal agreement for payments, goods or services constitutes a contract.

Otherwise if it's in writing, you can write it on a napkin, both sign it and it's as binding as anything. Some written contracts can be cancelled within three days.

Answer 6

There has to be a 'meeting of the minds'. That is all parties must agree to what they are doing. It doesn't have to be written, it can be oral, but there must be an agreement as to what is to occur (all ramifications of the agreement do not need to be agreed upon, only the basic(s)).

I'm not an attorney, of course.