Contract Elements, Its Creation and Enforcement

Contracts are the critical elements of the everyday business operations, as they define clearly the positions of each party. Nonetheless, some legal issues have a tendency to exist due to the complicated structure and the vitality of the particular elements for the contract creation. The primary goal of this paper is to discover the nature of the contract formation and enforcement by analysis the essential elements for the contract establishment, Statute of Frauds, legal and equitable remedies, and void, voidable, express and implied contracts.

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Essential Elements of Contract

Contracts play the role of regulators of sufficient relations in the business world (Emerson, 2009). Nonetheless, the contracts have to comply with the particular principles in order to be formed. In this instance, the elements will help resolve conflicts between the parties. An agreement is the first one, and it implies that the parties have to agree to the fundamental rights and obligations of each party (Miller, 2014).

It could be said that this approach defines the interactions between the parties from the legal perspective and helps avoid misunderstandings while functioning together or completing the project. Nonetheless, this aspect implies that the contract has to consist out of offer, acceptance, and consideration to establish a legal relationship between the parties (Burnett & Bath, 2009). In the end, these principles are the essentialities for the contract formation, as otherwise, the legal misinterpretations might be created.

Characteristics of Each Element

The definition of each element has to be described, and the essentiality of each aspect for the contract validity will be determined. Firstly, the agreement implies that both parties have to agree to the particular obligations and rights of each other and claim that they agree to the same bargain (Miller, 2014). It remains evident that the agreement is a complex element and includes offer and acceptance. It could be said that the agreement defines the legal responsibilities of both parties, which make the contract valid in the context of the business law.

In turn, offer implies giving the promise to do a particular action in future (Miller, 2014). In this instance, the offer is required to be definite, as, the offeree has to understand the aspects that he acquires clearly. The offer is an essential aspect of the contract validity, as it identifies the aspects, which are proposed by one party. Moreover, it helps avoid misinterpretations in future due to the clear definition of the interests in the contract, as it complies with the legal principles of business law.

The agreement underlines offeree’s assent to the offer (Burnett & Bath, 2009). This aspect is essential for the validity, as it emphasizes that both parties agreed to the offer and recognized the obligations. Lastly, the consideration is what each party brings to exchange for the accepted offer (Burnett & Bath, 2009). In the end, all of these aspects are essential for the validity due their ability to define the obligation of both parties and comply with the law principles.

Concepts of Void and Voidable Contracts

It could be said that the differences between void and voidable contract have a tendency to exist. Void implies that the contract remains illegal due to its controversial and immoral nature, which does not comply with the business law and human rights (Helewitz, 2010). In this case, it can violate the structure of each element due to the nature of the void. The lack of the presence of any element makes contract void. Nonetheless, it usually questions the ability of the contract to emphasize the significance of the human rights.

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As for the voidable contract, it is originally enforced. However, it could be annulled due to misinterpretation of the points or lack of the essential elements of the contracts (Helewitz, 2010). In this case, the essential elements of the contract formation and validity might have some misconceptions. It could be said that lack of the clear definition of agreement, offer, consideration, and acceptance are the primary reason for the definition of the voidable contract, as these aspects create misinterpretation of the responsibilities and obligations of each party.

Express and Implied Contracts

The primary difference between express and implied contracts lays in the definition. Express contract clearly defines the rights and obligations of each party in the written format or orally (Ashcroft, Ashcroft, & Patterson, 2013). In this case, the express contracts are actively implemented in the business world, as it helps people avoid risks while complying with the aspects and fundamentals of the business law.

In turn, the implied contract states that some of the obligations and aspects are not written on the paper, but not require the written confirmation, and they are implied by the acts (Ashcroft, Ashcroft, & Patterson, 2013). These type of contracts is also actively implemented. Various contests and lotteries use the principles of implied contracts, as each participant knows his/her ability to win the prize (Miller & Hollowell, 2010). In the end, the differences of these types of the contracts are beneficially implemented in the business world.

Implications of Statute of Frauds

The Statute of Frauds clearly identifies what contracts have to be presented in the written format in order to remain enforceable (Reilly, 2000). It could be said that this aspect clearly defines the enforceability of the contracts, as some of them have to be written before being considered as legal. In this case, this aspect assists in avoiding misinterpretations between the parties since the point are hard to modify the written contract. In turn, the oral contracts create more complications and remain one of the reasons for difficulties in the business world.

It could be said that the written representation of the principles and obligations of both parties creates the legal background for the actions of the both parties. In this instance, Statute of Frauds limits the potential violations of the breach of contracts and critically affects the enforceability. It could be said that it plays the role of the regulator in terms of defining the relationship between the parties and formation of the contract.

The concept of the application of remedies was created in the 1960s (Halbert & Inguilli, 2012). The remedies regulate the interactions and the ability of the parties to correspond to the regulations, which are discussed in the contract. In this case, legal remedies tend to return money to the money, which experienced the negative actives of another participant (Helewitz, 2010). It could be said that it controls the actions of each party, as it is usually applied as a penalty for the violation of the breach of the contract.

Equitable remedies imply introducing the particular actions to resolve the matter. One of them is rescission, and it states that the contract can be restated to satisfy the needs of the both parties (Helewitz, 2010). Specific performance and the contract reformation are also considered as equitable remedies. It the end, it could be said that equitable remedies define that each party is responsible for following the agreement in the contract, as the remedies can be actively applied to underline the necessity to take responsibility for the actions after the breach.

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References

Ashcroft, J., Ashcroft, K., & Patterson, M. (2013). Law for business. Mason, OH: South-Western Cengage Learning.

Burnett, R., & Bath, V. (2009). Law of international business in Australasia. Leichhardt, NSW: The Federation Press.

Emerson, R. (2009). Business law. Hauppauge, NY: Barron’s Educational Series.

Halbert, T., & Inguilli, E. (2012). Law and ethics in business environment. Mason, OH: South-Western Cengage Learning.

Helewitz, J. (2010). Basic contract law for paralegals. New York, NY: Aspen Publishers.

Miller, R. (2014). Business law: The first course summarized-case edition. Stamford, CT: Cengage Learning.

Miller, R., & Hollowell, W. (2010). Business law: Text and exercises. Stamford, CT: Cengage Learning.

Reilly, J. (2000). The language of real estate. Chicago, IL: Dearborn Financial Publishing, Inc.

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StudyCorgi. (2021, March 19). Contract Elements, Its Creation and Enforcement. Retrieved from https://studycorgi.com/contract-elements-its-creation-and-enforcement/

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