A contract is an agreement between two or more parties with commitment to do or to omit doing something. These agreements are voluntary, deliberate and legally binding. Contracts may be written, spoken or implied. Contracts are common phenomenon is world of business, in sales, leases and or tenancy relation. As a maxim in law, contacts are guided by some underlying features defined in different jurisdictions.
Offer and Acceptance
An offer is a voluntary but conditional promise submitted by the buyer or seller to the other party for acceptance. It’s a willingness by the initiating party to enter into a legally binding agreement with specific underlying conditions(ANSON, 2015). Acceptance on the other hand; is the unconditional assent by the offeree communicated to the offeror to the terms and conditions with intent to accept. For a transaction of an offer and acceptance to be legally binding, communication must be made of the intent to be bound by the contract by both parties. The conditions in the offer must be the same in those at the acceptance more so, the agreement must be certain.
Subject Matter in a contract.
In a contract, the product or service forms the subject matter. One party in the contract offers the products or services while the other pays for them. Both parties must seem to benefit from the arrangement and value changed from one party to the other. The subject matter may be existing, future or a spes. The subject matter should be well identifiable by descriptive characteristics like weight, height, shape, and color among others. Deliverables should based on this descriptive specifications of the matter.
Contents of a contract
The contents of a contract document are called clauses or terms. The main contents of a contract are the price and the subject matter.Terms may be expressed or implied. This may be conditions, warranties or innominate terms. An express term is the one agreed between the parties while implied terms are those conditions implied by statutes or as defined by a court of law. Conditions are the core part of the contract and cannot be breached. Warranties are guarantees extended by the manufacturer or offeror of a service to take responsibility of the subject matter within specified time of the contract at their own costs. Innominate terms are neither conditions nor warranties but seek to determine the extent of deprivation of benefits to the innocent party in a contract.
Dispute Resolution Mechanisms
Deviations from the terms of the contract results to breach of contract. The breach can result to different liabilities. The liability may be criminal or civil (Virgo, 2014). Criminal liability arises in areas of public interest like environmental conservation, nuisance, health and public safety. When disputes occur in a contract, several mechanisms are provided in law to resolve the disputes. In a case where parties feel aggrieved by the breach, they can sue for damages in a court of law. Arbitration is a case where the disputes are settled out of court between the parties(Carter, 2011). Arbitration may involve a nonpartisan arbitrator to help in the mediation.
Contract management practices
For effective discharge of contract by performance, parties need to manage the contract to ensure everything happens as planned and agreed with the parties. This involves planning for the contract to ensure procedures are developed to ensure expected outcomes are understood, contract dates monitored, costs controlled and performance is done within time frames. A monitoring system should be incorporated to ensure targets and conditions are met in the process of performance. Adequate communication with executing parties is dire; the contracting parties should also be briefed of the progress to avoid surprises. Incase changes occur that affect the conditions, discussions should be held to ensure parties are reading from the same page.
When parties engage in a contract, they envision a situation where discharge is through delivery of their obligations in the contract without failure. However, certain conditions may affect the delivery of the contract. Other forms of discharge exist under the maxims of law. This includes mutual agreements of the parties with the present condition or in exemption of the same. In some cases, an act of God may render the contract undeliverable and hence automatically terminates and cease to exist.
Virgo, G. (2014). Personal and Proprietary Remedies for Breach of Confidence: Nearer to Breach of Fiduciary Duty or Breach of Contract
Carter, J. (2011). Breach of contract.Chatswood, N.S.W.: LexisNexis Butterworths.
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Collins, H. (2005). European Social Policy and Contract Law. European Review Of Contract Law, 1(1).
ANSON, W. (2015).PRINCIPLES OF THE ENGLISH LAW OF CONTRACT.