As many businesses make contracts and deals on a regular basis, the need for a written agreement is often overlooked. By law, an oral agreement is sufficient however in the long run, a written agreement can save a lot of time, money and effort and is of particular importance in the case of a dispute.
The advantages of a written agreement summarised:
- A legal document which specifies the ins and outs of the agreement can ensure there is a clear framework on matters discussed and agreed upon.
- Â It helps to clearly identify parties to the transaction.
- It is easy to get confused or forget dates and times that may be relevant during a business transaction, thus having it on paper can make things a lot easier.
- The written agreement will provide each party with the Terms and Conditions of what was agreed.
- A written agreement is more likely to be enforced in court in the case of a dispute.
It is also important to understand and be made aware ofÂ the elements that are required to make a contract binding and capable of being enforced by law.
The essential requirements of a contract are
1)Â Â Â An offer made by one party.
2)Â Â Â An acceptance of that offer made by the other party.
3)Â Â Â Consideration.
4)Â Â Â An intention for the contract to be binding (as opposed to a domestic agreement made between friends).
By Murshida Khan a law student on work experience at Lawdit solicitors