What is a Contract?

What is a Contract?

What is a contract? Everyone has a pretty good idea of what a contract is it’s an oral or written agreement between two or more parties to do certain things.

When one party fails to honor or fulfill the contract, the contract can be righted or the contract is in breach.

A breach of contract occurs if the contract is broken and the breaking party fails to follow the agreement, the plaintiff can take the case to court.

3 Elements of a Contract

There are three elements of a contract. However there are certain elements to a contract in the eyes of the law. To be an actual binding contract you have to establish all these elements. So the elements of the contract:

• Offer: an offer to do something
• Acceptance of that offer
• Consideration. And people think, “well what’s the consideration?” Well consideration can really be anything.

In law school you learn about a lord who had a saying pertaining to considerations. “It’s my kingdom for a peppercorn.” That is using the idea of how little consideration can actually be in the eyes of the law.

And then you have to have a mutuality of obligations which means each party has to do something otherwise it’s not a contract it’s just a gift. And then the next element is the parties entering into the contract must have the competency and the capacity to enter into it.

A very easy explanation of that is that a minor can’t enter into business contracts or official contracts because they don’t have the official capacity in the eyes of the law.

2 Kinds of Contracts

And then there are your two basic types of contracts. You have an oral contract and a written contract. And based upon the names of those contracts you make the distinction between them.

A written contract is in writing and an oral contract is not in writing; it is just a verbal agreement. But all the other elements are the same.

What is the Statute of Limitations on Contracts in Florida?

The distinction between an oral and a written contract comes into play with the statute of limitations in the case that a contract is breached. Don’t wait too long to pursue a case or try to manage it yourself. You’re not an attorney nor do you know what the opposition may do or fail to do.

Contracts are generally about money. A breach of contract may cause you, your family, your business or your company and staff to lose financially. A contract was written or created to establish a process, a promise, or create a method for handling business. Be sure to find out whether your breached contract can be handled by talking with an attorney you trust and who has experience in business litigation.

Written Contracts: 5 Years

A written contract has a five-year statute of limitations where you you can file a complaint based on the breach of that written contract.

Oral Contract: 4 Years

However in Florida an oral contract has a four-year statute of limitations. So if someone breaches the oral agreement with you, you have four years in which to bring that action in court.