Published on:
September 11, 2023
12min read

What Makes a Contract Valid

Anthony Ipsum

Making a Contract Valid: A Guideline from CheersContracts

In the realm of business, contracts form the bedrock of relationships, outlining terms and conditions, and ensuring mutual benefits. But what exactly makes a contract valid? Let’s dig into this together with CheersContracts, your legal tech solution for small to medium enterprises (SMEs).

A valid contract is the must-have in business interactions, and it requires key elements: a clear offer and acceptance, mutual understanding of the terms, an exchange of value (consideration), legality and capability of parties, and preferably, a written agreement. Navigating these aspects can be complex, but Cheers simplifies the process with customisable templates, an e-signature solution, and analytics services, ensuring your contracts are valid, enforceable, and beneficial for your business. Let's dig in!

Understanding the Basics

A valid contract requires a few fundamental elements. It starts with a clear 'offer' and 'acceptance'. This means that one party proposes a deal, and the other accepts it without alterations. If the acceptance does vary, it's considered a counteroffer, and the original offeror must accept this new proposal for the contract to be valid.

But, how do you present offers and acceptances in a professional, legally sound manner? Fret not, CheersContracts' collection of customisable business templates are at your service, offering structured frameworks for your business needs.

Meeting of the Minds

Next up is the 'meeting of the minds', or 'mutual assent'. Both parties must understand and agree to the terms outlined in the contract. Misunderstandings can lead to contract disputes, but this can be mitigated by clear, well-drafted contracts. Don't worry about drafting; our customisable templates are here to assist!

Something for Something

A valid contract also requires 'consideration', meaning each party must give and get something of value. It can be money, services, goods, or even promises to do or not do something. Always be explicit about what is being exchanged in your contracts to avoid any potential confusion or disputes.

Legal and Capable

The contract must be for a legal purpose, and the parties involved must be capable of entering into a contract. This means they should be of legal age, of sound mind, and not under duress or undue influence. If these factors aren't met, the contract could be deemed void or voidable.

Put It in Writing

Although oral contracts can be valid, it's generally recommended to put agreements in writing, especially for significant transactions. Not only does it provide tangible evidence of the terms agreed upon, but it also makes it easier to enforce in court if necessary. Our secure, streamlined e-signature solution can help put your contracts in writing without the need for a physical pen and paper.

Closing Thoughts

Valid contracts are fundamental to the success and growth of your business. They not only protect your interests but also pave the way for fruitful, dispute-free business relationships. It may seem daunting, but with CheersContracts’ suite of solutions including customisable templates, e-signature, and analytics, you're set to navigate the business landscape with confidence.

Stay informed, stay protected, and say "Cheers" to valid contracts!

For more insights on contract law and management, do check out our blog section.

Connect and Help

Why Contracts Are Important: Navigating Business Landscapes with CheersContracts

Contracts are like rulebooks for business deals. They clearly tell everyone involved what they need to do and when. This helps avoid confusion and makes sure everyone is on the same page. So, if you're doing business, contracts are your best friend to keep things clear and fair.
Read more >
August 7, 2023

How to Write a Service Agreements

When you're operating in the business world, service agreements are as vital as your morning cup of tea. They act as the blueprint for your relationship with service providers or clients, outlining what's expected from each party. But how do you draft one that is comprehensive and foolproof? Here's your step-by-step guide, brought to you by Cheers.
Read more >
August 7, 2023

How are contracts usually signed

In the world of contracts, the traditional method of 'wet ink' signatures on paper is making way for electronic signatures on digitised contracts. This shift not only brings efficiency but also plays a crucial role in environmental sustainability. Increasingly, first contract reviews are taking place on mobile phones, a trend that underlines the need for transparent terms and faster signing processes. This digital transformation is streamlining contract management, making it more accessible, efficient, and greener.
Read more >
August 7, 2023