An agreement is a fundamental part of any business transaction or legal relationship. To ensure its enforceability, certain essential elements must be present. Here's a brief overview of the essentials of a valid agreement:
- Offer and Acceptance: The foundation of any agreement is a clear and definite offer by one party and its acceptance by the other. The terms should be mutually agreed upon without any ambiguity.
- Legal Consideration: For an agreement to be binding, there must be something of value exchanged between the parties, known as consideration. It can be money, services, or goods.
- Capacity of Parties: Both parties entering into the agreement must have the legal capacity to do so. This means they should be of legal age, mentally sound, and not disqualified by law.
- Free Consent: Consent between the parties should be free and not influenced by coercion, undue influence, fraud, misrepresentation, or mistake.
- Lawful Object: The purpose of the agreement must be lawful. Agreements involving illegal activities are not enforceable by law.
- Certainty and Possibility of Performance: The terms of the agreement must be clear and certain. If the terms are vague or impossible to perform, the agreement may be considered void.
- Not Declared Void: The agreement must not be of a nature that is expressly declared void by law, such as agreements involving gambling or restraint of trade.
Incorporating these essential elements ensures that an agreement is legally sound and enforceable, providing security and clarity for all parties involved.
