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Feb 6, 2012 · A person offers to give another person something (for example: to deliver an item in return for a certain price); to provide a service (to work for a certain salary); or to refrain from doing something (not to compete for a period of time in return for compensation). If the offer is accepted, the contract is then valid in principle.
Contract law employs the principles of consideration and promissory estoppel. In most cases, consideration need not be pecuniary (monetary). Most contracts are enforceable only if each party receives consideration from the agreement. Consideration can be money, property, a promise, or some right.
Under certain circumstances, a person can seek compensation for providing services to another person (restitution) or managing the other person's affairs (e.g. taking action to protect an absent neighbour's property from flooding) without the awareness or consent of the other person (negotiorum gestio or necessitous intervention).
- Offer. An offer is the tentative promise that begins contractual negotiations. It is when one party to a contract initiates and indicates a desire to enter into a relationship with another party.
- Acceptance. When an offer is made, acceptance of the offer generally requires positive conduct meaning that the acceptance is deemed only to have occurred when the accepting party acts in some way or form that confirms acceptance.
- Consideration. Consideration as an element to a legally binding contract is without the same meaning as the word consideration in common language. While giving careful thought, being the common language meaning of the word consideration, is prudent in contractual negotiations, the word consideration as it applies to contract law means the existence of a value for value exchange between the parties to a contract.
- Intention, ad idem (meeting of the minds) The element of intention involves a genuine desire to establish legal relations. Where a reasonable bystander listening to negotiations would fail to perceive sincerity among one or more of the parties, formation of a contract has failed; and accordingly, the element of intention requires an objective rather than subjective review as was confirmed in, among others, the case of West End Tree Service Inc.
If a person signs a contract because the other person threatened them the contract may be unenforceable, depending on the circumstances and kind of threat that was made. Undue influence is when someone abuses their power over another person to convince them to do something against their will.
A promise made under seal by one party becomes immediately binding without the necessity for acceptance by the other party, although that other party may avoid the contract by refusing to assent to the promise.
People also ask
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What is an example of a contract?
To be valid for the purposes of a contract, an offer needs to be communicated to the other party, and the other party must have a chance to either accept or reject the offer. Once made, an offer can be easily withdrawn prior to acceptance.
