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A contract is a legally binding agreement between parties to create mutual obligations that businesses and individuals use to protect their interests. Contracts outline the specific terms of engagement for a transaction. They can also dictate legal consequences if a party tries to break the agreement.
For a contract to be enforceable, it must include all five elements: offer, acceptance, consideration, capacity, and lawful purpose. These elements ensure that the agreement is legal, fair, and binding for everyone.
The basic elements required for the agreement to be a legally enforceable contract are: mutual assent , expressed by a valid offer and acceptance ; adequate consideration ; capacity ; and legality .
Contracts are legally enforceable, which mean you can take action against a party that fails to fulfil its obligations. What Are the Basic Principles of a Contract? There are four main elements of a contract, including offer, acceptance, intention to create a binding legal relationship and consideration.
When reading a contract, pay attention to specific details, such as obligations, timelines, and conditions. If there are any ambiguities or inconsistencies, seek clarification from the other party or consult with a legal professional.

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The fundamental features of contract include an agreement between the parties, an exchange, and enforcement through expectancy damages where possible.

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