Legal Contracts

Leezer Kaur
Apr 25, 2023
3 min read

“Written by Leezer Kaur, a student.”

Introduction

Legal contracts are contracts that are legally enforceable in a court of law. These are relied upon by the court of law in case of dispute between the parties to such a contract. These contracts can take place between more than two parties. These provide for the promises on the part of the parties to such contract which is supposed to be fulfilled, and in case of a breach, the other party can sue in a court of law.

Essentials

To be considered a legal contract, the following essentials are supposed to be fulfilled:

There must be an offer made by one party.
The offer must have been accepted by the other party or parties.
It must provide for valid consideration in exchange for the act of a party under the contract.
It must not provide for anything which is considered illegal under the law.
Both or all the parties to such a contract must agree to the terms of the contract and are supposed to sign it.
Both the parties entering into such a contract must be competent they must be of sound mind.
The assent of the parties to such a contract must be out of their own free will.
It may be oral or written, but the written form is preferred as it involves lesser chances of disputes concerning the terms and conditions.

If the contract does not fulfill the above-mentioned requirements, then it will not be null and void and will not be enforceable in a court of law. It may also provide for terms and conditions applicable to the parties to such contracts and remedy or compensation in case of breach of such contract.

Classification of Legal Contracts

Based on the mode of execution:

Express contract: It is mainly in written form, where the terms of contracts are expressly stated.
Implied contract: It has to be inferred from the conduct of the parties to the contract and is not in a written form.

Based on the number of parties to such a contract:

Unilateral contract: where only one party agrees to act or provide something to the other party.
Bilateral contract: when both parties are supposed to exchange items or services as per the terms and conditions of the contract.
Multilateral contract: where more than two parties are involved.

Uses

These are commonly used in the following cases:

It is used in case of a service agreement between a customer and the service provider regarding the service and maintenance of the product bought by the customer.
It is also used between an employee and an employer to provide for their rights, duties, and responsibilities during the term of their employment.
It is also used when there is a need to keep some information confidential by the parties to such a contract.
It is also used in the case of a partnership agreement to define the roles, rights, and responsibilities of the partners.
In the case of loan agreements, it defines the amount, interest and last date of repayment, etc.
It may also be used in the case of independent contractor agreements and sales contracts.

Breach of Contract

A breach of contract refers to a condition where the terms and conditions of the legal contract are disobeyed. In case of breach of a legal contract, the victim party can approach the court of law as these contracts are legally enforceable.

In case of a breach, the victim party can demand the remedy, if any, provided under the provisions of the contract or it can also terminate the contract or can approach the court for compensation or part-performance.

If the contract itself provides for conditions under which it can be terminated and is terminated under those conditions, then it will not constitute a breach of contract.

Conclusion

A legal contract is a contract that is enforceable in a court of law. It has to be for a valid legal purpose and follow the provisions of the law. It may provide for the terms and conditions to be complied with by the parties to the contract. In case of breach of such contracts, the victim party can sue the other party in a court of law.

References

'Legal Contracts', Contracts Counsel, available at: https://seqlegal.com/free-legal-documents/legal-disclaimer.
'What is a Legal contract?', available at: https://www.thebalancemoney.com/what-is-a-legal-contract-462462.
'Contract laws in India', available at: https://www.legalserviceindia.com/laws/contracts.htm.