The right contract can make the difference between success and failure for a business. At Hanten & Associates, our attorneys can make sure that you have the right contract. We are experienced business transaction and contract lawyers who are willing to work hard to see that your venture is a successful one.
Our contract services include the following:
- Contract Bidding and Negotiation
- Contract Preparation
- Payment and Collection
- Government Contracts & Administrative Law Issues
- Contract Termination
- Requests for Equitable Adjustments
- Surety Issues
- Contract Related Issues
- Land Subsidence, Quality of Workmanship, Materials Issues
Hanten & Associates have developed a reputation for providing efficient, cost-effective, and well-organized legal representation to builders, contractors, subcontractors, developers, lenders, and suppliers.
What Is a Contract?
A contract is simply a legal agreement between two or more parties with specific legal remedies for breach.
There are several factors to consider to determine whether a contract has been made. Once a contract has been created, it must be determined if there are any issues that call into question the contract’s validity. Finally, if there has been a breach of the contract, there is a question of whether a party has incurred damages.
Why Contract?
A correctly written contract can help you to ensure that you will get what you expect from a business relationship.
Not only can much of the emotional or financial burden of such situations be avoided by engaging in a contract, but one can also make more money, provide and obtain better goods and services, develop integrity in the business community, and establish one’s self with stronger, sustainable, and recurring business relationships.
Contract Components
There are three elements that must be present for a contract to exist: an offer, an acceptance, and consideration.
– Offer
Offer is a first step in the process of creating a contract. An offer is a written or spoken statement by a party of his or her intention to be held to a commitment upon the acceptance of the offer. There are factors determine wheather a statement costitutes an offer.
– Acceptance
In order for an acceptance of an offer to be valid, the acceptance must be made while the offer is still open. Other ways an offer may end include: the person making the offer withdraws the offer, the person who receives the offer rejects it, a reasonable amount of time passes after the offer is made, or the subject matter of the offer is destroyed before acceptance.
If a person changes the conditions of the offer in responding, the offer is rejected and a counteroffer is made. In this scenario, the person who made the original offer responds to the new offer by accepting it, rejecting it, or proposing yet another offer. There are two ways a person accepts an offer: by promising to do or not do something (bilateral contract), or by performing the desired act (unilateral contract).
– Consideration
Consideration is a legal concept meaning something of value that is given in exchange for a performance or a promise to perform. Consideration can be money, goods, a promise to do something there is no legal obligation to do, or a promise to not do something there is a legal right to do. Promises to exchange money, goods, or services are forms of consideration. All parties in an agreement must give consideration in order to create a contract; it is consideration that distinguishes contracts from gifts. Courts typically do not look at the adequacy of consideration unless there is evidence of some type of wrongdoing by the party benefiting most from the contract.
Legality of a Contract.
Although two persons may exchange an offer, an acceptance, and consideration, if the subject matter of the contract is illegal, a valid, enforceable contract does not exist. For example, if a person offers to pay another person money for illegal drugs, and an acceptance is made by a promise to deliver the illegal drugs this is nevertheless a void contract.
Capacity of the Parties
In order to be bound to a contract, the parties must be competent to enter into such a legal arrangement. Underage persons, persons who are mentally ill, and intoxicated persons are usually not held to the contracts they enter. However, a minor may have the option of enforcing a contract.
Mistake, Duress, and Fraud
A mistake by both parties to a contract on an important issue makes the contract unenforceable. However, a mistake by only one party does not necessarily make the contract void.
Duress is the use of physical force or mental pressure by one party to make the other party agree to the contract. The use of duress makes the contract voidable by the party put under duress.
Fraud is the intentional misrepresentation of an important issue of the contract. The presence of fraud in a contractual proceeding makes the contract voidable by the party upon whom the fraud was perpetrated.
Contract Termination
Once there is a valid contract between parties, it can end in several ways. A contract may have a limited time span and finish at the end of the stated time. If a person is hired to work for two weeks, the contract concludes at the end of two weeks.
In many instances in which there is a specific time frame stated in the contract, parties to the contract may have the option to extend the contract for a longer period of time. Contracts also may be project-specific, not time-specific. Goods or services may be contracted for a project and upon the completion of the project, the contract ends. Parties to a contract may mutually agree to rescind the contract, in which case the parties may agree on the duties and responsibilities of each party after the rescission.
A contract also may end because of a breach. A breach occurs when a person does not fulfill his or her responsibilities as promised in the contract. A breach may be minor or major. A minor breach is one that affects small, minor details of the agreement and may not affect the outcome of the contract.
A major breach is one that affects the subject matter of the contract and very likely will affect the outcome of the contract. This is also known as a “breach of a material issue.” When there has been a breach in a contract, the question of damages is raised.