On the lowest level, a contract requires:
1) Offer (“I’ll sell you this signed baseball for $100)
2) Acceptance (“Yes I accept” or a simple nod of the head)
3) Consideration (each side either gives something up or benefits).
There’s also this legal concept called Statute of Frauds, which requires a contract be in writing for certain types of agreements. The most noteworthy instances that the Statute of Frauds applies to businesses is for the following contracts: 1) performance contracts that cannot be performed within a year; 2) contracts for the transfer of land; 3) contracts for the sale of goods totaling $500 or more; and 4) contracts in which one party acts as a guarantor for another party’s debts.
Of course there are other business contracts that have particular requirements as well. That’s why you should contact a business attorney when you’re dealing with important contracts – to make sure you hit all the points and to double check you aren’t being outmaneuvered by the other side.
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