Valid Contract Essentials

Posted on Dec 4, 2024 in Law & Jurisprudence

1. Introduction

The basic philosophy behind a contract stems from the Latin phrase pacta sunt servanda, meaning agreements must be kept. However, only a valid contract can be enforced. The essentials and purpose of a contract are crucial for its validity.

2. Definition

According to the Contract Act, a contract is an agreement enforceable by law.

Essentials of a Valid Contract

The following are the main essentials of a valid contract:

i. Free Consent of Parties

A valid contract requires the free consent of all parties involved.

ii. Lawful and Moral Object

The contract’s objective must be lawful and moral.

iii. Proposal

One party must make a proposal to another.

iv. Acceptance

The proposal must be accepted by the party to whom it is made.

v. Lawful Consideration

There must be lawful, moral, and possible consideration, which should not be doubtful.

vi. Capacity of Parties

Parties must be capable of entering into a contract; minors or insane individuals cannot.

vii. Certainty of Meaning

The contract’s wording must be clear and not uncertain or vague; uncertainty voids a contract.

viii. Legal Relationship

The contract should create a legal relationship, defining rights and responsibilities.

ix. Enforceable by Law

The contract must be capable of being performed or enforced under law.

Final Analysis

A contract lacking these essentials is not valid. A valid contract can be oral or written.