Basic Requirements for a Valid Contract
See the explanations relating to valid agreements, valid offer and valid acceptance. These are just guidelines and you should always discuss your specific contract and circumstances with your attorney.
What makes an agreement valid?
Below is a check list of the requirements for a valid agreement between contracting parties.
- Consent or a “meeting of the minds” must take place between all parties;
- All parties must have the legal capacity to contract;
- A contract need not be embodied in a single formal document. It can consist of two documents, the written & signed offer and the written & signed acceptance (as long as, in both documents, one refers to the other) and even a verbal agreement;
- There is no legal prohibition on concluding a contract on a Sunday (this is a common misconception).
What makes a valid offer?
- Blank spaces in a set template should be completed correctly and where they are not applicable they should be deleted and initialed by both parties;
- If some material terms are left to be discussed later, the proposal is not a complete offer, and acceptance does not create a contract, unless it is clear that the matters which still to be discussed are in fact immaterial to the contract as a whole;
- The offer must be brought to the offeree’s attention, either personally, telephonically, by fax or by post – in writing or orally;
What makes a valid acceptance?
- The acceptance of a must either be in writing and signed or orally or made by his authorised agent acting on his written authority;
- Acceptance must be clear and unambiguous (not have two possible meanings);
- The offeree’s acceptance must be communicated to the offeror to conclude a valid contract, that is that it must have come to his attention;
- The offer can only be accepted by the person to whom the offer is addressed, or his duly authorised agent.
Contracts can be quite confusing at times and it is always advisable to speak with your attorney to clarify certain terms. Should you have any questions or concerns relating to a contract, please feel free to contact us to set up an appointment and have your matter dealt with.