What is Required for a Contract to be Valid?

Irvine business lawyers help companies to negotiate contractual agreements and to draft agreements that will be enforced. Contracts are supposed to create private law, which means that they allow the parties to the agreement to establish requirements, rights and obligations that a court of law will enforce. Without contracts, it would be impossible or highly impractical for many business transactions to take place. For example, a supplier might not want to produce a customized product for a buyer without the certainty of knowing a buyer would be obligated to purchase that product after ordering it.

Because contracts are so important in the business world, there are ample laws setting forth contractual requirements and establishing remedies when contractual agreements are breached. In order to get the benefit of a contract, however, it is imperative to ensure that the contract you create is valid and enforceable.

Brown & Charbonneau, LLP can help you to understand what is required for contract validity and can work with you to create a contract that will be considered valid so your rights under the agreement are protected. Give us a call today to find out more about how our Irvine business lawyers can help with contractual matters.

Requirements of a Valid Contract

California Civil Jury Instructions section 302 detail the specific factual elements that must be present for a valid contact to exist. This means that if you want the court to enforce your contract and consider it valid, all of these things must be true:

• The contract terms must be sufficiently clear. This means that the language of the contract must not have been so vague that people didn’t know what the contract required of them. The contract language must have been clear enough both so that the parties to the agreement knew what the contract terms were and so that the court can interpret the contract to determine what the requirements were when assessing whether or not the contract was breached.
• Consideration must have been exchanged. Consideration means each party to the contract gave something of value. The parties to an agreement typically negotiate to determine what each party will give. It is common for contracts to involve an exchange of promises, such as one party promising to build a website and the other company promising to pay for the website design. The item the parties exchanged must actually have had value and must not be a pretext. For example, a contract in which Mark promises to give $50 a day to Fred in exchange for Fred not buying alcohol prior to age 21 would not be a legally valid contract because Fred did not give consideration; he was already not permitted to purchase alcohol by law.
• The contracting parties must have agreed to the contract terms. This means they must have voluntarily entered into the agreement and not been coerced into signing due to duress or because of fraud. There is, however, no requirement mandating that the contract is valid only if the parties actually read and understood the terms of the contract. Each party has a duty to read the full agreement before acquiescing and signing on to the contract. If the contract terms were reasonably clear and if one party chose to sign the agreement without reading and understanding the terms, that person still is considered to have agreed to the contract terms even if he opted not to read them.

Brown & Charbonneau, LLP can help you to draft a contract that contains all of these necessary elements of a valid agreement. If you cannot prove in court that all of these things are true, then your contract won’t be considered enforceable and you will not be able to take advantage of any legal remedies for breach of contract or failure to perform.

Getting Help from Irvine Business Lawyers

Irvine business lawyers at Brown & Charbonneau, LLP can help you to understand the rules for contract formation and can assist you with the process of creating a contract. We can negotiate contract terms on your behalf for you, draft an agreement, help you to ensure that the contract contains necessary provisions to be valid, and provide you with representation in case problem arise including a potential breach.

To find out more about how our firm helps you with a wide array of contract law matters, give us a call at (866)237-8129 or contact us online today.