What is a Contract?
A contract is a legally binding agreement between 2 people (it does not need to be written!)
Written contracts are mainly for proof (such as a receipt in shops are evidence for the purchase which you have just made) or to look back on what was agreed.
Contracts Gives Parties RIGHTS & OBLIGATIONS
Some contracts must be in writing because statute requires it, for example:
• Finance (credit) – inc. phone contract
• Employment – – need to know to be able to refer to it
Four ‘Ingredients’ Must Be Present in Order for a Contract to Exist
2. Acceptance (an agreement, not yet a contract)
4. Intention to create legal relations
All four of the above must be present in order for a contract to exist. If one is missing then there is no contract between the parties.
Formation of a Contract