BUS670 Legal Environment
Professor Roger Amos
May 24, 2010
This paper is a study of the Element of a Contract detailing the essential elements that constitute a legal binding agreement. A contract can be defined as an agreement between two or more persons for example, individuals, organizations or government agencies and or business, to do, or to refrain from doing something in exchange for something of value. The text states “to qualify as a contract, a set of promises must be based on a voluntary agreement, which is made up of an offer and an acceptance of that offer. In addition, there usually must be consideration to support each party’s promise. The contract must be between parties who …show more content…
(2010). Business Law: The Ethical, Global and E-Commerce Environment. New York McGraw-Hill/Irwin. pg. 380). According to Deborah Shefrin in, Contracts: Deal or no Deal “This is the cause, motive, price, or impelling influence that induces each party into a contract. It is some right, interest, profit, or benefit that accrues to one party, or some forbearance, detriment, or loss undertaken by the other party. In other words, mere must be value exchanged for a promise. A valid contract requires all parties to give consideration” (2006). For example, Verizon agrees to provide Managed Services to a Pharmaceutical Corporation and, in exchange, the company promises to pay a set fee.
In conclusion, the essential elements of a contract are to be adhered to in order that a contract can be legal and binding. There has to be some negotiation followed by an offer and then acceptance. The next phase is voluntary and consideration. Until there is consideration there is no contact but with consideration there is continuance of the contract process to capacity and legality and eventual contract. Contracts have facilitated the growth of modernization, technology and globalization. With the advancement in technology, contracts can be executed and implemented from different parts of the world that is able to improve the human experience, from the basic necessities of life and peace or war. Contracts provides us with the assurance that we may look to the court of law