Introduction to contracts

What is contract?

A legally binding agreement between two or more persons, by which rights are acquired by one or more to acts or forbearances on the part of the other or others

Duties promised by parties

1. Doing or not doing certain acts for parties

2. Giving rights to the other person

contract can exist in

1.oral

2.by conduct (behaviour)

examples of contract by oral

Buying food

Disadvantage of oral conduct

no written record —>uncertainty

ELEMENTS of a legally binding contract

1.Offer and acceptance

2.Consideration (exchange of promise between parties)

3.Intention to create a legally binding relationship (want their contract to be legally enforceable)

4.legal capacity (mature enough/ above 21)

Breach of contract

When one party refuses to perform his contractual duties

Consequence of a breach of contract

sued in court + defendent must pay losses directly caused by the breach (pg 22)

3 types of contracts that is invalid even tho elements of a legally binding contract is present

1.void

2.voidable

3.unenforceable

Void contracts

Contract will act as it has never existed (e.g. goods/monies will return to its original position). Cannot claim damages

Voidable contracts

Stop the contract, usually are parties suffering under the contract due to an inappropriate act committed by the other party

Unenforceable contract

no successful court action however goods/monies exchanged may be kept by the parties.