Contract Law Description: Contract law is the law that governs contracts. A contract can take several forms - it can be written on a piece of paper (or napkin, even) or it can be just a verbal agreement if it satisfies the Statute of Frauds.
A contract is basically an agreement between two or more people which creates an obligation to do, or not do, something. The agreement creates a legal relationship of rights and duties. If the agreement is broken, then the law provides certain remedies.
There are three factors necessary to create a contract: 1) an offer, 2) acceptance, and 3) consideration. One party makes an offer, the second party must accept the offer and there must be consideration exchanged. Consideration has to be something of value.
For a contract to be legally enforceable, not only do all the parties to the contract have to get something in return, but they must also suffer a detriment. In other words, one cannot contract to give someone else $500 unless the other person gives up something in return.
Contract law covers the legal implications of a contract. For instance, contract law determines what is and is not consideration, whether a contract was actually intended, if the parties making the contract were legally competent, whether there was fraud or duress involved, or how a contract is terminated. Certain contracts are not legally valid, for instance, if the contract goes against public policy (such as a contract to satisfy a gambling debt). In most instances,people who are not of the age of majority are not allowed to make contracts. When writing a contract, it is important to remember a central principle to contract law - terms of a contract will be construed against the drafter of the contract. Thus, any ambiguities or uncertainties will be resolved against the writer. For instance, if someone drafts a contract where there is uncertainty as to whether the drafter has to pay $500 or $800 for a good or service, the contract will be interpreted against the drafter - i.e. he or she will have to pay the $800 amount.
Contract layers provide legal representation to draft contracts including purchase and sale agreements, business forms, licensing agreements, employment agreements, and other contracts. In addition, contract lawyers assist clients in litigation commonly associated with contracts including breach of contract suits, suits to enforce an agreement, and fraudulent contracts.
Statute of Frauds: To satisfy the Statute of Frauds, a written agreement is required in certain circumstances. A writing is required for any contract that can't be completely performed within one year of its commencement, a contract involving the sale or purchase of real estate, a contract to answer for the debt of another person, or a contract involving a sale of goods for a price in excess of $500.00.