Contract

A contract is an agreement between two or more parties who agree to perform or refrain from performing an act for breach of which the law provides a remedy.It is enforceable by the courts. It can be made in written form, as well as oral form. Making a contract is not only happening in the business area, we also enter into contracts by the tens of even hundreds every day. Getting into a taxi to take you to work is a contract for services between yourself and the taxi driver. When you go to the shop and buy your goods, you have entered into a contract for the sale of the goods. There are many different types of contract, but seldom last forever. Contracts can be express contract and implied contract, or bilateral and unilateral contract. Express contracts “consist of agreement in which the terms are stated by the parties.” (Express and Implied Contracts) They can be stated orally or in writing. Implied contracts are different from express contracts. They are stated based upon the conduct of the parties. A valid contract consists of three major elements, which are the offer, the acceptance and the consideration. However, there are also some other elements , such as capacity and legality. These elements will be discussed in the paper. A good offer and a good acceptance make up with a valid agreement. Agreement is a meeting of minds of two parties. That means the parties of the contract should be on the same page. First, an offer is the intention by the offeror to be bind. A joke or jest, the expression of opinion, advertisements, auction, and future intent are not valid agreements. It is not a good offer if your friend is joking to you, and saying that he will sell you his computer by one dollar. You cannot suit your friend if he does not sell you the computer because it is not a good offer. An advertisement is not an offer. It is an invitation to offer. If you see an advertisement, then you go to the store and ask the sells person to sell you the product. That means you are offering an offer. Second, an offer should have reasonably contained and definite terms. These terms should include price, identify the parties, time, and method of payment. Third, the offeror should communicate to the offeree. An acceptance can be words or conduct. A good acceptance must be “unequivocal”. The offeree should communicate to the offeror. Another important thing is that silence is not acceptance. The acceptance is valid when it is sent. Generally speaking, the offeror can revoke the offer before it is accepted. However, option contract, promissory estoppel, and firm offer by a merchant are irrevocable offers. When the offeror revokes the offer, or the offeree rejects the offer, the offer is end. If the offeree rejects the first offer and makes a new offer, it is called counter offer. Consideration is the reason for making the promise. The major idea behind consideration is that “the parties have intentionally entered into a bargained exchange with one another and have given to each other something in exchange for a promise or performance.” (Mann and Roberts) It comprises two basic elements which are legally sufficient and a bargained for exchange. Legally sufficient means the value must be given in return for a promise or performance. The value does not necessary means money. You can promise to do something you have no legal duty to do, or do something you have no legal duty to do, or refrain something that you can legally do. A bargained for exchange is the promise must induce the other person to make a return promise or performance. Gift, pre-existing duty, past consideration, and illusory promises are agreements that lack of consideration. Therefore, they are not contracts. For example, Mary took care of your dog for two days when you went out for work. A week later, you said you would like to pay Mary money for her caring of your dog. Your promise is not enforceable because the event is past. Mary does not need