What Defines a Contract?

Contract Law 101

A contract is an agreement between two parties that creates an obligation to perform (or not perform) a particular duty.

A legally enforceable contract requires the following elements, all of which are discussed in more detail below.

1. An Offer (I’ll mow your lawn this Saturday if you pay me $40)
2. An Acceptance (You’ve got a deal)
3. Mutual Consideration (the value received and given – the money and the lawn mowed)
4. Legal Parties*
5. Legal Purpose **

* A contract with a minor is not legally enforceable. Because of age and presumable lack of experience, the law considers a minor contractually incapable.

** An agreement to purchase marijuana, for example, is not a legal contract. Because the subject matter of the agreement is illegal, the contract is not enforceable and the parties have no legal remedies for breach.