There are four main elements that must be in a contract to deem it valid.
The first of which is an offer. The offer is the initial start to any interaction from one or more parties intending to enter into a contract. An offer is defined as, the price at which an individual is willing to sell a security or commodity. This is the opposite of bid, which is the price at which an individual is willing to buy a security. An offer is the same as an Ask. The person to make the offer or have something for sale etc. is called the offeror. The recipient to the offer who will consider or accept the offer from the offeror is called the offeree.
For example if someone wanted to take out a mobile phone contract, the offer of the contract has been provisionally set up in the phone shop. Therefore that is where the offer takes place. The shop has the offer and is then the ‘offeror’ and you are the ‘offeree’ looking for the contract.
The second element to any contract is acceptance. The key part of acceptance is that it must be communicated and all terms negotiated or agreed by both parties before the next step of the contract can be entered into. Communication is vital so that both parties know the terms and conditions of the situation exactly and are happy to abide by these. If these terms are unaccepted then the contract will be altered to more suitable negotiations until both parties are happy with it. If any terms are broken within the contract it is called a breach of contract and the offending party can be taken to court.
When considering the phone contract the terms can often be negotiated and altered to suit the needs of the customer, therefore counter offers can be made which set up other contracts deeming their previous agreements void. Once terms are agreed by both parties there is then a solid binding contract in place which both sides are happy to taken part in. You can then move onto the consideration.
Consideration is defined as something given,...
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