Basic Elements of a Contract

There are four basic elements of every contract. You must have an offer, acceptance, consideration, and performance to have a valid contract. There are issues for each element that can wreck havoc on interpretation. Learn the basics and gain an understanding of how a simple contract for a boy shoveling the snow from your driveway can go woefully wrong.

Contract

Contract

A contract is defined as any oral or written agreement between two or more parties that exchange rights and/or duties between the parties. Every contract has four essential elements. The first two create ‘mutual assent’ or what is commonly referred to in law as a ‘meeting of the minds’. 

What is a Contract?

Contract

Article 1 of the Uniform Commercial Code copyrighted by the American Law Institute is considered the primary source for the definition of a contract. All of the 50 states have incorporated all or most of the definition of this code as statue. A contract is defined as a legal obligation between two or more parties. A contract has to have four elements for it to be binding on the parties. 

Use Phase Accounting in Construction – Part II (Trades)

This section covers the three traditional trades that require a license from their respective state. This is your HVAC installer, the electrician and the plumber. In some contractor may wish to include the septic tank and water well installer. However, I prefer these two be included in the site development phase as they do impact the site and there is only one connection to the main builder for these two particular trades. 

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