A contract is a promise or set of promises that the law will enforce and for the breach of which the law will provide a remedy. Contracts help to allocate risk between parties and provide a forum where promises can be enforced. Parties often choose to put their agreements in writing, which are called “express” contracts. Sometimes, however, parties will create obligations that the law will enforce based solely on their conduct, called “implied” contacts.
To form an enforceable contract, whether express or implied, three essential elements must be satisfied:
(1) an offer (manifestation of a willingness to enter an agreement)
(2) an acceptance (an acceptance must be communicated to the offeror before the offer expires or is revoked)
(3) consideration (a bargained-for exchange that requires a legal “detriment” to the “promisee”)
A legal detriment is suffered when a person does something he/she is not obliged to do, or when a person forbears from doing something he/she is legally permitted to do. Say, for example, you tell your friend, “I promise to give you $100 two weeks from now.” Two weeks pass and your friend comes to you asking for the $100. She claims you two had a contract. If your promise to give the $100 is not in exchange for anything that your friend will give up, a court will not enforce your promise under a contract theory because there is no “consideration.”
Understanding the terms and definitions in contracts can be confusing and intimidating. The experienced contract attorneys at Giordano Spanier & Heckele Law Firm can advise you on any contractual issues like formation, breach and interpretation. Contact us today for a consultation by calling (520) 495-0869 or email [email protected]