A contract is an agreement between two or more people.Without the ability to enforce a contract, neither party is required to honor it.Determining whether an agreement is binding is easy.
Step 1: The contract should be reviewed by an attorney.
If the contract is substantial in value, an attorney should review it to make sure nothing is overlooked.It is a good idea to consult an attorney at the contract writing stage if you are unsure.
Step 2: Determine if the subject matter of the contract is lawful.
To be valid, a contract needs to be made for a lawful purpose.Contracts to engage in illegal activity are not valid and will not be upheld in court.An example of an illegal contract is the sale of illegal drugs.
Step 3: There is a search for incorrect information.
The contract will be invalid if there is a specific intent to defraud.To avoid accusations of misrepresentation or fraud, double-check all information in the contract.
Step 4: An offer, acceptance, and consideration can be identified.
The three basic elements for a contract to be valid are a specific offer, acceptance of the terms, and consideration, which is the agreed-upon exchange of goods or services.It is necessary for a valid offer to be sufficiently definite.It must be clear.You should have all the parts of the contract.Counter-offers can be attached to a contract.The contract is changed by the introduction of a counter-offer.A counter-offer replaces the original offer and is treated as a new offer.In the absence of formal acceptance, performance must be accepted.Acceptance must be made before the deadline in the contract in order to be accepted.Silence will not qualify as acceptance.The seller has acceptance of the offer if a person sends in an order for goods and the seller responds by sending the goods.mutual promises to do something or to refrain from doing something must be included in a contract.The contract is illusory if there is no mutual promise.
Step 5: Determine if the contract is in writing.
In order to be considered valid, certain contracts must be written in writing.Most contracts don't need to be in writing.Contracts that cannot be performed within a year, contracts for the sale of land, and contracts to pay another's debt are some of the contracts that must be in writing.
Step 6: You have to check for signatures.
The parties should have their full legal names and signatures on the contract.The date that the contract was entered into should be indicated by the signature.The contract is valid with electronic signatures.There are different types of e-signatures.Some require the party to type its name into a field, while others can use a person's fingerprints.A valid e-signature can be found even if you click an "I Accept" button.
Step 7: If the contract was signed by an attorney, you should look at it.
Depending on state law, witnesses or notaries are usually required for wills, deeds, mortgages, and marriage contracts.
Step 8: The parties needed to have legal and mental capacity.
Minors and certain individuals with mental illness do not have the capacity to enter a contract if they are legal adults.The contract entered into by someone without legal capacity is void.People who are drunk or impaired don't have the mental capacity to sign a contract.
Step 9: It was confirmed that neither party was coerced.
If one party was coerced into entering the contract, it is void.If you can, you should investigate the circumstances surrounding the contract formation and see if there is any pressure on the other party.Sometimes duress can occur when one party partially performs on a contract and then suddenly refuses to complete its obligations unless the other party pays substantially higher prices.If one party exerts too much influence on another, a contract will be voided.There is a special relationship between the parties.An opportunity arises for the caretakers to exert influence on the elderly person because he is totally dependent on them.
Step 10: The bargaining power between the parties is relative.
There is a gross disparity in bargaining power between the parties and the terms of the contract are oppressive.One-side terms can be considered unconscionable if they establish excessive prices or high penalties.It is necessary for the parties to have equal bargaining power.The terms must be unfair.They should shock the conscience.
Step 11: The parties are still living.
When one of the parties dies, a contract is revoked.You can check for death records if you don't know the other party.
Step 12: Check if the contract can be performed.
If circumstances have changed so that it is either impossible or impracticable to perform, performance will be excused.The changed circumstances can't be done by one of the parties.Impossibility can occur after a contract is created.If your house burns down, it becomes impossible for you to paint it.Impracticality occurs when changing conditions make it more difficult to perform.If you have contracted a wedding photographer for a local wedding then decide to elope to Hawaii under new conditions, it becomes impracticable to expect that the photographer would honor the original contract.If the original contract specified a location, you may be in violation of the contract.
Step 13: The contract may have been frustrated.
If the reason behind someone entering into a contract changes, frustration of purpose is a legal way to end the contract.In order to claim frustration of purpose, both parties need to be aware of the purpose.If you live next to a rodeo venue, you may want to rent out your basement for a party before or after the event.The person who is contracted to rent your basement may be released from the contract if the rodeo is canceled.
Step 14: There is a violation.
The other party is not allowed to perform if a contract is broken in a material way.It cannot be a minor violation.It needs to strike at the heart of the contract.The non-breaching party must be willing and able to perform.If you are not prepared to perform your obligations under the contract, there is no need to claim a breach.If you ask for improvements to be made, you are not able, ready, and willing to perform.You are trying to change the contract.