Here are some basics of a legally valid contract. Any business in Arizona can benefit from properly putting together contracts. Having an accurate contract when you begin working together with a vendor or other partner can help to minimize conflicts down the road. There are many different legal terms included in a contract, but the majority of contracts need to have only two elements in order to be seen as legally acceptable in Arizona. There must be an “agreement” and the agreement must have “consideration.” Consideration is a promise to do something one is not otherwise legally or contractually obligated to do – virtually any promise can be legally valid “consideration.”
Parties Have to Agree on Terms Inside
All parties need to agree on the major issues involved in the contract. The contract is only valid when one party’s offer is accepted by the other party. In the day to day steps of working through a business with contracts, the steps of acceptance and offers can become convoluted and confusing. For instance, sometimes an offer isn’t always unequivocally accepted in a quick manner.
The other party may wish to think about the terms for some time or attempt to get a better offer. Unless an offer has a stated expiration date, it will remain open for what’s known as a reasonable amount of time. This is open to interpretation in the Arizona courts, and depends on the business and the facts involved.
Something of Value Must Be Exchanged
A simple way to explain this is a contract between a vendor and a company. The vendor is responsible for providing a service or set delivery of goods, and the company would pay for this. This exchange of value is a basic element of all contracts.
Benefits of a Written Contract
In the majority of situations, a contract should be in writing. Although there are only a few situations where there must be a written contract, it is often recommended that you have a written contract in order to clarify issues and have a document to return to in the event of a dispute. Most verbal contracts will be enforced, but written contracts give a better idea of what will be enforced.
One of the most important things you can do to protect yourself with a legally valid contract is to work with an Arizona business attorney to craft one. Having an outside individual review this material and provide you with a contract can be extremely beneficial. Do not hesitate to get advice from a person who has a background in putting together contracts.
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding Basics of a Legally Valid Contract, or any other commercial litigation matters, please feel free to contact Joel E. Sannes at 480.461.5307, or log on to udallshumway.com, or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full service law firm. We assist Individuals, families, businesses, schools and municipalities in Mesa and the Phoenix/East Valley.