Re: Legally Binding Contract?

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On 5/05/08, Melissa wrote:
> Is a legally binding contract "a promise on the part of
one
> party of one party to undertake a legal obligation with
> respect to another party" OR "an agreement which involves
> any type of mutual obligations on the part of the parties
> to the agreement"

All contracts require an "offer" an "acceptance" of the
offer and "consideration." There must also be a "meeting of
the minds" on the terms. If you were to promise to mow your
neighbors lawn and he says "I accept" that is not a contract
because there is no "consideration" for your promise.
Several other rules apply to contract formation. If you
need more depth, try to GOOGLE "contracts" & "definition."

In general contracts are of two types:

Unilateral contract = a promise that requires performance
to accept. i.e., "I promise to pay you $20 if you mow my
lawn."

Bilateral contract = "I will mow your lawn for $20."
response "I agree to pay you $20 to mow my lawn."

Those two contracts may seem identical but there is an
important difference. In the first example there is only
one promise, the promise to pay if you do the work. The
offer can only be accepted by performance. If you don't mow
the lawn there is no breach of a contract on your part
because you did not promise to mow the lawn. The only
promise made was by the person who promised to pay $20 if
you mowed the lawn. The promise of payment of $20 will only
become binding if you actually accept the offer by doing the
work. If you don't mow the lawn no contract was ever formed
so no breach occurs.

The second example is a promise by both parties. There is a
binding contract from the moment you exchange promises. One
person promises to pay $20 to you to mow the lawn and you
promise to mow the lawn in exchange for $20. In the second
example if you fail to mow the lawn you have breached the
contract and will be liable for damages for your breach. If
the person who owns the lawn has to go out and hire someone
else to mow the lawn and can't get it done for less than
$30, you will be liable for $10 damages.