A contract is formed when two parties come to a mutual agreement that creates mutual legal obligations. A contract can be written or oral, but some types of contracts are required to be in writing. An oral contract is more difficult to enforce and should be avoided, if at all possible.
Some types of contracts must be in writing in order to be valid. This is required by the statute of frauds and is used to deter fraudulent contracts. Contract that must be in writing to be enforceable include:
- A contract involving the sale or transfer of land;
- A contract involving the sale of goods over five hundred dollars;
- A contract wherein an individual promises to pay the debt of another;
- A contract in which performance will not or cannot be completed within a year of the contract formation;
- A contract that involves the consideration of marriage; and
- A contract wherein an executor of an estate agrees to personally satisfy the debts of the estate.
Contracts are a part of everyday life for most individuals. Because of this, it is important to be familiar with contract requirements to ensure a contract is valid. Valid contracts must include certain elements in order to be legally enforceable, such as:
- An offer, such as an individual will pay $200 for 100 cupcakes;
- And acceptance of the offer that is presented, such as the ordering party agrees to pay $200 for 100 cupcakes;
- A promise to perform, such as the cupcake seller saying they will perform by making the 100 cupcakes;
- A valuable consideration, or payment of $200 for the cupcakes;
- A time or an event when the performance must be completed, such as 100 cupcakes in two weeks for a birthday party;
- The terms and conditions of the performance, such as 50 cupcakes should be vanilla and 50 should be chocolate;
- Performance, when the 100 cupcakes are delivered and the baker is paid $200.
It is important to note that the regulations and laws regarding contracts vary by jurisdiction. Most contracts are governed by state statutes. An attorney can help an individual ensure any contract they enter into complies with local regulations.
Most contracts are required to include the following information:
- The identification of both parties entering into the contract, including names and addresses;
- A reasonably identifiable subject matter;
- Fundamental terms and conditions of the agreement that are clearly stated; and
- The signatures of both parties.
It is important to note that if both parties to a contract do not sign it, then the non-signing party is not liable for their performance of the contract. However, if a contract is for the sale of goods, the only signature required is the signature of the party accepting the goods as well as a term regarding the quantity of the goods. This rule may apply if the individual selling the goods did not include an area in the contract for the seller to sign or made it clear their signature was not required.
What is a Personal Contract?
A personal contract is a contract that is entered into by single individuals, rather than their representatives or agents on behalf of a business or businesses. A personal contract can also refer to a contract entered into for the exchange of personal property rather than real property.
Personal contracts can cover a wide range of goods or services. It may also refer to contracts allowing one party to use the property of another, such as a contract that allows one individual to borrow another individual’s car for a certain time period.
In many cases, a business corporation is actually a separate legal entity apart from the members and stockholders of the company. If a member of a corporation wishes to enter into a contract separately from the corporation, they can enter into a personal contract in order to prevent legal issues from overlapping with their involvement with the corporation.
What are Some Examples of Personal Contracts?
A personal contract can be used to describe:
- A contract for the sale, purchase, or exchange of personal property;
- A contract for real property that is being treated as personal property;
- Certain royalty contracts, especially those covering oil, gas, or other natural resources; or
- Various types of insurance coverage policies for property.
Personal contracts must follow all the basic requirements for a valid contract in order to be legally enforceable. This may include terms such as:
- Delivery dates;
- Method of payments; and
- Other terms.
When Should a Personal Contract be Used?
One of the main reasons an individual should use a personal contract is to prevent confusion, especially when one or both parties serves as a representative or an agent for a business organization. When an individual is engaging in transactions outside of the company business, it is very important that the parties do not use company documents or forms to conduct their personal business.
A personal contract may also be used in more informal situations, such as the sale of a vehicle between two friends. Using a personal contract in such situations helps provide a written account of the transaction. Instead of creating a sense of distrust between friends, a written personal contract may help encourage the parties to act in a professional and ethical manner when fulfilling the contract duties.
In What Ways Can a Personal Contract be Breached?
A personal contract may be breached in a number of ways. Depending on the terms of the contract, a personal contract may be breached in ways, including:
- A party fails to render payment;
- A party fails to deliver goods as promised;
- A party changes amounts or quantities of the good; or
- A party transfers or assigns contractual duties to another party without authorization.
Another common type of breach of personal contract includes when a party provides a different item than what was agreed upon. This may cause quite a conflict in a personal contract because, in many cases, the subject matter of a personal contract is often a one-of-a-kind item or a rare collectible item.
What are Some Personal Contract Remedies?
In many cases, the appropriate legal remedy is for the breaching party to provide the non-breaching party with a damages award. A monetary damages award is meant to compensate the aggrieved party for any economic losses springing directly from the breach of contract.
For example, a defendant may be required to pay the plaintiff for the cost of any goods that were never delivered. In some cases, a plaintiff may be awarded other additional related damages, such as those that cover additional losses caused by the breach. For example, compensation for a loss of profits or wages due to a missed shipment of goods.
In other cases, equitable remedies may be awarded, such as an injunction. For example, a court may order an injunction ordering a defendant to cease unauthorized use of copyrighted material. A plaintiff cannot recover under an equitable remedy if they have engaged in a similar wrongdoing as the defendant.
Do I Need a Lawyer for Help With Personal Contract Remedies?
Yes, it is essential to have the help of an experienced contract lawyers for any issues with personal contracts. Remedies in personal contract claims may involve many different legal issues. A lawyer can review your case, advise you on what laws apply in your area, and represent you during any court proceedings, if necessary.