Contract Agreement

A Contract Agreement is a legally enforceable agreement that binds two or more contracting-parties that creates mutual obligations to the stated terms under contract law.

• AKA: Legally-Enforceable Promises Made by One Party to Another, Legally Binding Agreement Concerning a Bargain.
• Context:
  • It can (typically) include Contract Elements, such as:
    • Foundational Contract Elements:
      • Contract Offer: A clear and definitive offer to provide something (see Contract Offer and Acceptance).
      • Offer Acceptance: Indicates mutual understanding and intent to be bound (see Contract Offer and Acceptance).
      • Contractual Consideration: The legally sufficient exchange of value.
      • Mutual Consent: Willingness and knowledge of terms.
      • Legality of Purpose: Compliance with law and public policy.
      • Legal Capacity: Authority and competency to contract.
      • Contract Duration: Valid period and termination conditions.
      • ...
    • Operational Contract Elements:
      • Legal Entity Rights and Legal Entity Duties.
      • Performance Obligations and Compliance Requirements.
      • ...
    • ...
  • It can follow Contract Lifecycle Processes, such as:
    • Contract Creation Stages, such as: contract drafting stage, contract review stage and contract negotiation stage.
    • Contract Management Stages, such as: contract administration stage, contract performance monitoring stage and contract modification stage.
    • Contract Closure Stages, such as: contract termination stage and post-contract review stage.
    • ...
  • It can (often) be governed by Contract-Applicable Legal Frameworks, such as:
    • Contract-Applicable Laws (contract law, commercial law, regulatory requirements)
    • Contract-Related Procedural Mechanisms (dispute resolution, enforcement protocols)
    • Contract-Related Jurisdictional Requirements (applicable law, choice of forum)
    • ...
  • It can (typically) involve Contract-Related Tasks, such as: contract drafting task, contract review task, contract negotiation task, and contract compliance monitoring task.
  • It can involve Contract Risk Frameworks, such as:
    • Contract-Related Risk Types, such as: contract performance risks, contract-related legal risks and contract-related financial risks.
    • Contract-Related Risk Management Measures, such as: contract risk Mitigation Strategies, contract risk Contingency Plans and contract monitoring Protocols
    • ...
  • It can establish Contract Communication Protocols, such as contract Notice Requirements, contract Reporting Obligations and contract Disclosure Requirements.
  • ...
  • It can range from being an Organization-to-Organization Contractual Agreement to being a Organization-to-Person Contractual Agreement to being a Person-to-Person Contractual Agreement, depending on the contracting party types and their legal entity status.
  • It can range from being a Pre-Signed Contract to being a Active Signed Contract to being a Inactive Signed Contract, depending on the contract lifecycle stage and contract execution status.
  • It can range from being a Valid Contractual Agreement to being an Invalid Contractual Agreement, depending on whether it meets all contract validity requirements and legal enforceability criteria.
  • It can range from being a Written Contract to being a Verbal Contract, depending on the form of agreement, documentation requirements, and evidentiary standards needed for contract enforcement.
  • It can range from being a Two-Party Contract to being a Multi-Party Contract, depending on the number of contracting parties and complexity of contractual relationships involved.
  • It can range from being a Simple Contract Agreement to being a Complex Contract Agreement, depending on the contract scope, number of contractual obligations, and intricacy of contract terms.
  • It can range from being a Privately Enforced Contract to being a Court Enforced Contract, depending on the dispute resolution mechanism and whether enforcement action requires judicial intervention or private arbitration.
  • It can range from being a Short-Term Contract to being a Medium-Term Contract to being a Long-Term Contract, depending on the contract duration and whether it involves a one-time obligation, recurring obligation, or perpetual obligation.
  • It can range from being a Single Jurisdiction Contract to being a Multi-Jurisdiction Contract, depending on the geographical scope, applicable law, and whether it involves cross-border transactions or international business relationships.
  • ...
  • It can specify Contract Enforcement Measures, such as: contractual penalties, liquidated damages, and contract remedies.
  • It can establish Contract Governance Frameworks, such as: dispute jurisdiction, applicable law, choice of forum, and alternative dispute resolution.
  • It can be implemented through Contract Implementation Forms, such as: contract transactions, contract performance actions, and contract milestones.
  • It can be classified as Contract-Related Assets, such as: intangible assets, financial instruments, and contractual rights.
  • It can be associated with Contract-Related Risks, such as: performance risks, legal risks, and financial risks.
  • It can be categorized by Contract Classification Schemes, such as: contract types, contract structures, and contract purposes.
  • ...
• Example(s):
  • Contract Type Examples by Party Structure:
    • Organization-to-Organization Contracts, such as:
      • The Apple and Microsoft Agreement (1997), where Microsoft invested $150 million into Apple
      • The Standard Oil Trust Agreement (1882), consolidating multiple oil companies
      • The Concorde Aircraft Agreement (1962) between British and French governments
    • Organization-to-Person Contracts, such as:
      • The Nike Endorsement Contract with Michael Jordan (1984)
      • The HarperCollins Publishing Contract with J.R.R. Tolkien (1937)
      • Employment Contracts like Job Offer Letters and Non-Compete Agreements
    • Person-to-Person Contracts, such as:
      • The Pablo Picasso Contract with Daniel-Henry Kahnweiler (1912)
      • The simple Loan Agreement between John and Michael
  • Contract Type Examples by Lifecycle Stage:
    • Pre-Signed Contracts, such as:
      • Contract Templates for Standard Service Agreements
      • Draft Employment Agreements awaiting signature
    • Active Signed Contracts, such as:
      • Current Software License Agreements
      • Ongoing Maintenance Contracts
    • Inactive Signed Contracts, such as:
      • The historical East India Company Charter (1600)
      • The completed Carbolic Smoke Ball Contract (1892)
  • Contract Type Examples by Documentation Form:
    • Written Contracts, such as:
      • Master Service Agreements
      • Real Estate Purchase Agreements
      • The De Beers Diamond Monopoly Contracts
    • Verbal Contracts, such as:
      • Traditional Marketplace Agreements
      • Simple Service Engagements
      • Ancient Oral Trading Agreements
  • Contract Type Examples by Complexity:
    • Simple Contract Agreements, such as:
      • Basic Residential Leases
      • Standard Vacation Rental Agreements
      • Simple Consulting Agreements
    • Complex Contract Agreements, such as:
      • Multi-National Partnership Agreements
      • International Supply Chain Contracts
      • The Red Bull Sponsorship Agreement with Formula 1 (2005)
  • Contract Type Examples by Number of Parties:
    • Two-Party Contracts, such as:
      • Basic Sales Agreements
      • McDonald's Franchise Agreement (1955) with individual franchisees
    • Multi-Party Contracts, such as:
      • Alibaba Investment Agreement with SoftBank (2000) involving multiple investors
      • Construction Contracts with multiple subcontractors
      • Union Contracts involving management, union, and workers
  • Historical Examples by Era:
    • Ancient Contracts:
      • Agreements recorded in The Nuzi Tablets (~1,400BC)
    • Industrial Era Contracts:
      • The Standard Oil Trust Agreement (1882)
    • Modern Era Contracts:
      • Technology and Software Contracts
      • Intellectual Property Contracts
  • ...
  • ...
• Counter-Example(s):
  • a Promisory Estoppel.
  • a Quasi-Contract.
  • a Treaty, such as the Treaty of Versailles between nations.
  • a Power of Attorney Agreement, permitting one person to act on another's behalf in legal matters.
  • a Last Will and Testament, stipulating the distribution of an individual's assets after death.
  • a Promissory Note Agreement, detailing a written promise to pay a definite sum of money.
  • an Arbitration Agreement, committing to settle disputes through arbitration rather than court proceedings.
  • a Medical Consent Form, acknowledging a person's agreement to undergo a specific medical procedure.
• See: Private Law, Law of Obligations, Business Law, Legal Relationship, Technical Document.

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References

2023a

• (Open AI ChatGPT, 2023) ⇒ https://chat.openai.com
  • A contractual agreement is a legal arrangement between two or more parties, known as the contracting parties, that outlines the terms and conditions under which they agree to interact with one another. This agreement is governed by contract law and is enforceable by law, provided that it fulfills specific requirements. The main elements of a valid contractual agreement include:
    1. . Offer: One party (the offeror) presents specific terms and conditions for an agreement.
    2. . Acceptance: The other party (the offeree) agrees to the terms and conditions presented by the offeror.
    3. . Consideration: Something of value is exchanged between the parties, such as goods, services, or a promise to perform or refrain from performing a certain action.
    4. . Mutual assent: Both parties genuinely and voluntarily agree to the terms and conditions of the contract, often referred to as a "meeting of the minds."
    5. . Capacity (Contract Law): Both parties must have the legal capacity to enter into the contract, which typically means they are of legal age and sound mind.
    6. . Legality (Contract Law): The contract's subject matter and terms must be legal and not contrary to public policy or any applicable laws and regulations.
  • When these elements are present, a contractual agreement becomes a legally binding contract. The parties involved are obligated to fulfill their respective duties and responsibilities as outlined in the agreement. If one party breaches the contract, the non-breaching party may seek remedies under contract law, such as damages, specific performance, or contract termination.

2023b

• (Wikipedia, 2023b) ⇒ http://en.wikipedia.org/wiki/Category:Contract_law
  • A contract is a legally-enforceable promise or set of promises made by one party to another.

    A contract is a legally binding agreement concerning a bargain which is essentially commercial in its nature and involves the sale or hire of commodities such as goods, services or land.

2021a

• (Wikipedia, 2021) ⇒ https://en.wikipedia.org/wiki/Contract Retrieved:2021-12-5.
  • A contract is a legally binding agreement that defines and governs the rights and duties between or among its parties. A contract is legally enforceable when it meets the requirements of applicable law. A contract typically involves the exchange of goods, services, money, or a promise of any of those. In the event of a breach of contract, the injured party may seek judicial remedies such as damages or cancellation. In the Anglo-American common law, formation of a contract generally requires an offer, acceptance, consideration, and mutual intent to be bound. Each party must be those who are binding by the contract. Although most oral contracts are binding, some types of contracts may require formalities such as being in writing or by deed. In the civil law tradition, contract law is a branch of the law of obligations.

    Each country recognised by private international law has its own national system of law to govern contracts. Although systems of contract law might have similarities, they may contain significant differences. Accordingly, many contracts contain a choice of law clause and a jurisdiction clause. These provisions set the laws of the country which will govern the contract, and the country or other forum in which disputes will be resolved, respectively. Failing express agreement on such matters in the contract itself, countries have rules to determine the law governing the contract and the jurisdiction for disputes. For example, European Member States apply Article 4 of the Rome I Regulation to decide the law governing the contract, and the Brussels I Regulation to decide jurisdiction.

2021b

• (Wikipedia, 2021) ⇒ https://en.wikipedia.org/wiki/Glossary_of_clinical_research Retrieved:2021-12-5.
  • Contract
    • A written, dated, and signed agreement between two or more involved parties that sets out any arrangements on delegation and distribution of tasks and obligations and, if appropriate, on financial matters. The protocol may serve as the basis of a contract. (ICH E6).

2014

• (Business Dictionary, 2014) ⇒ http://www.businessdictionary.com/definition/contractual-relationship.html#ixzz3WkcSDh1N
  • QUOTE: Legal relationship between contracting-parties evidenced by (1) an offer, (2) acceptance of the offer, and a (3) valid (legal and valuable) consideration. Existence of a contractual relationship, however, does not necessarily mean the contract is enforceable, that it is not void (see void contract), or not voidable (see voidable contract).

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