What do these words mean? How does they affect the meaning of the contracts?
All of us sign contracts on a routine basis, whether we work under contract or sign contracts for personal reasons, such as during a purchase. You may, for example, have signed a contract when you signed up for cell phone service. If you took the time to read the entire contractual agreement to determine exactly what you were agreeing to, you may have found yourself stumped by certain of the terms. In this post, we’ll define some of the terms that appear frequently in contracts. Remember, however, that the best way to interpret a contract is with the expert advice of a seasoned business law attorney.
In general, contracts are formed after the acceptance of a valid offer. The party extending the offer is called the offeror, and the party receiving the offer is called the offeree. Much of contract litigation focuses on the offer — the offeror’s willingness to enter into a contract with the offeree that provides the offeree with the power to accept the offer and create a contract. In addition, much litigation is devoted to the acceptance — the moment that the contract is created.
Contracts often have conditions. Depending on the language used, the obligations of one or more parties to do something pursuant to the contract may not come into effect until a particular condition has been satisfied. All contracts, however, must have what is called consideration. Consideration is the bargained-for exchange of the parties — “this for that” which the parties perform pursuant to the contractual exchange.
When a contractual agreement is breached, that is when one or more parties fails to do what they have agreed to do, the non-breaching party can seek a remedy. One type of remedy is damages — the financial adjustment the court can order one party to make to right the wrong. Damages are computed in many different ways, but are always designed to attempt to make the non-breaching party whole again after the breach, by, for example, ordering the breaching party to pay compensation. Another type of remedy is an injunction, which forces one party to take a particular action.
This post is just a limited overview of very common contractual terms. To go further in depth speak with an attorney at Willcox, Buyck & Williams, P.A. Contact us at our Florence office at 843-536-8050, or our Myrtle Beach office at 843-461-3020.