A contract is a promise or set of promises for the breach of which the law gives a remedy or the performance of which the law recognizes a duty. Generally, the four basic requirements of a contract are "Agreement," "Consideration," "Capacity," and "Legality."
The agreement requirement is established by "offer and acceptance." An offer may be accepted by the person to whom the offer was made until the offer is terminated. An offer can be terminated in various ways, such as by revocation, rejection, or passage of time.
Consideration is value given in return for a promise. It is a bargained-for exchange that may consist of performing an act or forbearing from performing an act.
Capacity addresses whether the law will recognize the ability of the parties to the contract to participate in the contract. For example, under certain circumstances a minor or a mentally incompetent person may not be required to comply with the terms of a contract he or she entered.
Legality deals with whether the subject matter of the contract is illegal or against public policy. A court will not enforce an illegal contract.
A contract may be expressed, implied-in-fact, or implied-in-law, sometimes referred to as quasi-contract. Contrary to popular belief, not all contracts must be in writing to be enforceable. While memorializing an agreement in a written contract usually is advisable, only those certain contracts listed in the statute of frauds must be in writing to be enforceable, and even then there are some exceptions. Of course, having enough evidence to prove the existence and terms of an oral contract may be difficult.
The law of contracts is not an exact science, and exceptions to general principles abound. For example, even in the absence of consideration, an aggrieved party still may be entitled to relief under the doctrine of "promissory estoppel." This doctrine attempts to avoid injustice that may occur if a promise is not enforced. By way of another example, while exculpatory contracts, that is, contracts in which a party waives his or her right to sue for damages based upon negligence, may be against public policy, whether a Court will enforce an exculpatory contract depends upon the specific circumstances involved.
If you need a contract reviewed or prepared, call me at my Burlington County office at (609) 953-2000, or send me an email with the specifics.