For most, contracts are part of your every day life. Whether you are leasing or buying a new home or vehicle or entering into a new employment, you are likely forming a contract. In order for a contract to be enforceable, however, there must be: (1) an offer; (2) the offer must be accepted; and, (3) there must be adequate consideration. There must also be sufficient specific terms so that the obligations of all parties can be ascertained.
An “offer” is a manifestation of a person(s) willingness to enter into a bargain, and proposed in a way as to justify another to believe that the offeror intended to enter into a contract.
When an “offer” is made, the offerree holds the power of acceptance, which permits the offeree to accept the offer, which ultimately transforms this offer into a contractual obligation. An “acceptance” is a manifestation of assent to the terms that were made by the offeree. The terms “offered” must be accepted in the manner in which the offeror required.
Finally, in order for a contract to exist, there must be consideration. Consideration is a benefit to the promisor or detriment to the promisee. In other words, consideration occurs when the parties both give and receive something from the exchange. For example, if two parties enter into a contract to sell/purchase a vehicle for $10,000, one party is giving $10,000 but is receiving a car in exchange. The other party is giving a car, but is receiving $10,000. Consideration may not exist, however, with gifts, pre-existing legal duties, among other exceptions.
Contract disputes often arise and even with the presence of an offer, acceptance and consideration, there may be applicable defenses. Some of these defenses include, but are not limited to illegality, if the contract is against public policy, if a party was either under the age of majority or did not have the requisite mental capacity to enter into a contract or the contract does not abide by the statute of frauds.
Contract law is very complicated, fact intensive and detail oriented. In order to adequately determine whether your contract is enforceable, contact Dow Law Office so that an experienced attorney can review the contract and determine your rights under Arizona law.