Legality In Contracts

Clients Rate Lawyers on our Platform 4.9/5 Stars
based on 2,724 reviews

Jump to Section

Need help with a Contract Agreement?

CREATE A FREE PROJECT POSTING
Post Project Now

Legality in contracts is an essential component of enforceable agreements. A single misstep can result in a host of legal problems.

Below, we’ve outlined everything you need to know about contract legalities:

What Is Legality of Purpose in Contract Law?

The legality of purpose in contract law is the terms and conditions in legal documents that are legally binding and enforceable. They often contain mutually agreed-upon obligations and requirements. Every enforceable contract must have the legality of purpose.

Here is an article that discusses the legality of purpose in contract law.

What is a Contract?

Contracts , also known as agreements, are legally binding documents between two or more parties. They come in a written or oral format. A signed contract is more straightforward to enforce than a verbal one.

Contracts are built on trust. If one party doesn’t hold up their end of the agreement, the other party can enforce the contract provisions in civil court. You should also use clear, concise language versus complicated wording, known as “ legalese .”

This web page also discusses contracts.

Why is Legality Important in Contracts?

In any business transaction, a written contract is essential. Agreements can serve as future references, part of the business’ policies, and evidence.

Here are six reasons why legality in contracts is essential:

Reason 1. Specification

Specification is one of the many reasons a written contract is necessary for your business. It can legally serve as proof of mutually agreed-upon details.

This element also clarifies the terms of a contract between a company’s owners or investors, as well as the services provided by a third party and the payment obligations to hired workers. As legal proof, you should state these obligations in all of your written contracts.

Reason 2. Avoids Misunderstandings

A written contract is usually produced between parties entering into a business agreement during a sensitive business venture. The main goal of this formal written agreement is to allow each concerned party to read and understand the terms and conditions .

These terms include each party’s expectations and what they have agreed to after a discussion. The written contract will also remind both parties that this is a serious business transaction.

Reason 3. Reassurance

A written contract can provide security and peace of mind to all parties involved. For example, employment contracts lay out the terms of the relationship between the employer and the employee. These terms specify the employee’s duties and responsibilities, payment, and overall relationship.

An employer is legally responsible for paying an employee’s wages and other benefits as required by law. In contrast, the employee must perform their assigned duties as outlined in the job description. When a party breaches the terms and conditions, the contract adequately protects the aggrieved parties.

Reason 4. Confidentiality

The ability to agree to confidentiality and non-disclosure provisions protecting sensitive information. This feature is one of the ultimate benefits of having written contracts in business transactions .

The concerned parties are legally bound to keep the transactions and information shared between them confidential as part of the agreement. Any party who violates this confidentiality agreement will be held liable under the contract.

Reason 5. Privacy

When one of the parties to a contract breaks it, the written agreement becomes vital. It will be used as a general reference to determine to what the parties agreed. They can also reveal who is truly at fault.

Having a written contract readily available reduces the chances of bringing the issue to court. It can even prevent the dragging out of litigation longer than necessary, which can be costly and time-consuming.

Reason 6. Creates a Bonafide Paper Trail

A written contract serves as an official record of the terms upon which the parties have agreed. It may, for example, specify the:

  • Level of authority given to business owners or managers
  • Completion date of any work contracted to a service provider
  • Payment of completed work
  • Stating the terms of when to terminate a contract .
Meet some lawyers on our platform

John P.

7 projects on CC
View Profile

Scott S.

13 projects on CC
View Profile

George L.

1 project on CC
View Profile

Max M.

104 projects on CC
View Profile

What Determines Legality in Contracts?

When a contract meets the legal requirements, it is legally enforceable. An agreement usually entails the exchange of goods, services, or money, or the promise of any of these. Although most oral contracts are legally binding, some contracts may require additional formalities.

4 Requirements for a Valid Contract

The four elements of a contract are essential to creating a binding agreement, regardless of the types of contracts you use. Let’s take a closer look below at how to write a contract that is valid below:

Requirement 1. Offer

Every legal contract begins with a verbal or written offer from one party to another, and written agreements prove that a contract exists.

The offer is a proposal for a relationship’s terms. It can also include any number of rights, obligations, warranties, and conditions that the parties must meet.

An offer does not become formally valid until received by the intended counterparty, also known as an offeree. The offeree has the option to revoke or counter the offer before accepting it.

Before the offeree accepts the offer, the offeror can withdraw it. A counteroffer will cancel the original offer, preventing the offeree from accepting it later.

Requirement 2. Consideration

An exchange of consideration must occur for a contract to remain valid. Consideration may be a vague, difficult-to-define concept, and this assertion is due to consideration presenting itself in different ways.

Depending on the scope of the transaction and the parties’ motivations, consideration can take various forms. In a contract, consideration is the sum of each party’s rights and obligations.

The following are examples of common types of consideration:

  • Money
  • Actions
  • Restrictions

The consideration must also be mutual, which means that each party must carry out the contract’s terms.

Requirement 3. Acceptance

Acceptance is the third component of a valid contract. Acceptance can be verbal or written, just like an offer.

For most cases, acceptance necessitates some form of action on the part of the offeree. In other words, a party’s inaction, silence, or other passiveness as evidence of contract acceptance will not suffice.

Conditional acceptance is possible in some contracts. Acceptance that creates a valid agreement through a party’s performance is possible in some cases.

Requirement 4. Intent

The final element of a contract is that the parties must mutually agree upon the terms. Intent is each party’s awareness of and willingness to comply with the agreement.

On the surface, this may appear to be an unusual requirement. However, in written agreements, questions of intent and whether the parties had an actual “meeting of the minds” arise frequently.

Examples of Legality in Contracts

Need an example of legality in contracts to solidify your understanding? Let’s take a look at one below:

  • Tom is a consultant
  • Jim owns and business and needs Tom’s services
  • Tom agrees to help Jim in exchange for payment
  • Tom drafts up an agreement and goes over it with Jim
  • Jim agrees to the terms and signs on the signature line
  • Tom agrees to the terms and signs on the signature line
  • The legality in contracts is upheld in this situation.

Contract lawyers in your state can help you draft the terms, conditions, and warranties. They ensure that your contract clauses are perfect for your unique situation, from contract drafting to an executed contract.

Post a project in ContractsCounsel’s marketplace to get flat fee bids from contract lawyers for your project. All lawyers are vetted by our team and peer-reviewed by our customers for you to explore before hiring.

How ContractsCounsel Works
Hiring a lawyer on ContractsCounsel is easy, transparent and affordable.
1. Post a Free Project
Complete our 4-step process to provide info on what you need done.
2. Get Bids to Review
Receive flat-fee bids from lawyers in our marketplace to compare.
3. Start Your Project
Securely pay to start working with the lawyer you select.

Meet some of our Lawyers

View Sean
Member Since:
June 21, 2021

Sean S.

Attorney
Free Consultation
Get Free Proposal
New Orleans, LA
7 Yrs Experience
Licensed in LA
Tulane Law School

I am an attorney with six years of experience drafting and negotiating a wide variety of business contracts, in industries including technology and software, finance, professional services, hospitality, and non-profits.

View Joshua
Member Since:
June 28, 2021

Joshua C.

Attorney/Owner
Free Consultation
Get Free Proposal
Ashland, MA
6 Yrs Experience
Licensed in CA, MA
UCLA School of Law

Attorney Joshua K. S. Cali is a respected business, estate planning, and real estate attorney based in Ashland serving Middlesex County and other nearby areas. Joshua graduated summa cum laude from Bentley University in Waltham, MA, and from UCLA School of Law in Los Angeles. Before starting his own firm, Joshua practiced estate planning for high net worth clients at a boutique law firm in San Diego, CA.

View Michael
Member Since:
June 28, 2021

Michael K.

Associate Counsel
Free Consultation
Get Free Proposal
Miami, FL
4 Yrs Experience
Licensed in FL
St. Thomas University School of Law

A business-oriented, proactive, and problem-solving corporate lawyer with in-house counsel experience, ensuring the legality of commercial transactions and contracts. Michael is adept in reviewing, drafting, negotiating, and generally overseeing policies, procedures, handbooks, corporate documents, and more importantly, contracts. He has a proven track record of helping lead domestic and international companies by ensuring they are functioning in complete compliance with local and international rules and regulations.

View Erin
Member Since:
June 29, 2021

Erin F.

Attorney
Free Consultation
Get Free Proposal
Costa Mesa, CA
15 Yrs Experience
Licensed in NJ, NY, PA
Rutgers University School of Law (JD)

Businesses, Contracts, Operating Agreements, Corporate, Real Estate, Start-Ups, Cannabis

View Drew
Member Since:
July 1, 2021

Drew B.

Managing Member
Free Consultation
Get Free Proposal
Cleveland, Ohio
24 Yrs Experience
Licensed in MO, OH
Saint Louis University

Drew is an entrepreneurial business attorney with over twenty years of corporate, compliance and litigation experience. Drew currently has his own firm where he focuses on providing outsourced general counsel and compliance services (including mergers & acquisitions, collections, capital raising, real estate, business litigation, commercial contracts and employment matters). Drew has deep experience counseling clients in healthcare, medical device, pharmaceuticals, information technology, manufacturing, and services.

View Daniel
Member Since:
July 1, 2021

Daniel R.

Managing Attorney
Free Consultation
Get Free Proposal
Chicago
9 Yrs Experience
Licensed in IL
Gonzaga School of Law

Daniel is an experienced corporate attorney and works closely with corporations, privately held companies, high-net worth individuals, family offices, start-ups and entrepreneurs. Daniel graduated from the Gonzaga University School of Law and is licensed to practice law in Illinois.

View Roman
Member Since:
July 10, 2021

Roman V.

Trademark Attorney
Free Consultation
Get Free Proposal
Milwaukee, WI
8 Yrs Experience
Licensed in MD
Marquette University Law School

I'm an experienced trademark attorney and enjoy helping clients protect and grow their brand names through trademark registration and enforcement. I've worked with a wide variety of clients in different industries, including e-commerce, software as a service (SaaS), and consumer goods, to register trademarks for product names, logos, and slogans, both in the US and abroad.

View Adam
Member Since:
July 6, 2021

Adam L.

Legal Counsel
Free Consultation
Get Free Proposal
London
13 Yrs Experience
Licensed in NY
University of London - Masters

12 Year PQE Lawyer with wide experience in sports, media and tech.

View Justin
Member Since:
July 7, 2021

Justin A.

Partner
Free Consultation
Get Free Proposal
Seattle, WA
5 Yrs Experience
Licensed in NY, WA
The University of Chicago Law School

I am an entrepreneurial lawyer in the Seattle area dedicated to helping clients build and plan for the future. I earned my law degree from the University of Chicago and worked in a top global law firm. But I found advising real people on legal issues far more rewarding. Reach out to discuss how we can work together!

View Max
Member Since:
July 12, 2021

Max M.

Business Attorney
Free Consultation
Get Free Proposal
Baltimore, Maryland
15 Yrs Experience
Licensed in MD
Georgetown University Law Center

Results oriented business attorney focusing on the health care sector. Formerly worked in Biglaw doing large multi-million dollar mergers and acquisitions, financing, and outside corporate counsel. I brought my skillset to the small firm market, provide the highest level of professionalism and sophistication to smaller and startup companies.

View Jaroslaw
Member Since:
July 20, 2021

Jaroslaw P.

Associate
Free Consultation
Get Free Proposal
Warsaw, Poland
15 Yrs Experience
Licensed in AK
Wroclaw University - Law

Attorney - I graduated in Law from the University of Wroclaw and in Economics from the Scottish University of Aberdeen; My legal interests include, in particular: contracts, intellectual property, and corporate law, as well as transactional / regulatory advisory along with related risk management (M&A); The industries with which I have worked most often are: IT, real estate and construction, professional sport, industrial chemistry and medicine, oil & gas, energy, and financial services; I possess many years of experiences working with international entities for which I have prepared and negotiated contracts, as well as (due diligence) reports, analyses, litigation documents, and presentations; Apart from law firms, I have also worked for investment banks and big 4 - thanks to that I also gained financial, technological, and consulting experiences; I shall be described by: accuracy, openness, honesty, concreteness, a broad approach to the problem, and ... a lack of bad manners, along with a good sense of humour :)

Find the best lawyer for your project

Browse Lawyers Now

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call