Contracts

Orlando Contract Law Attorney

A contract is a legally binding agreement between parties to do or not do something. Consumers enter into contracts everyday, whether buying a house, taking out an insurance policy or making a routine purchase. It is important that before entering into a contract, a person fully understands the terms of the contract that will bind the parties. Most contract disputes occur because of a misunderstanding between the parties or a failure to communicate. If you do not understand the terms of a contract, it is best to consult an attorney before agreeing to it. The law firm of NeJame Law can assist you with all the aspects of contract law.

The Formation of a Contract — There are three elements that must be present for a contract to exist:

• Offer: The first step to a contract is an offer. An offer is a written or spoken statement indicating a person's willingness to be held to a certain commitment upon acceptance. For example, "I am willing to sell you my car if you pay me $500." Not all offers, however, are valid. Key considerations:
  • Is the person making a serious offer? Courts usually look to factors such as the language used, surrounding circumstances, and the relationship between the parties.
  • Does the statement contain definite terms? Is the subject matter identified, are the parties identified, is the price set, are quantities determined, and is time for performance stated?
• Acceptance: The second requirement for a valid contract is acceptance of the offer. The acceptance must be made while the offer is still open. For example, someone might say "I will sell you this computer software for $2,000, but only if you buy it within the next two days." An acceptance made on the third day would not be good since the offer expired.

  Unless the offeror specifies otherwise, an offer can be accepted through the mail. If an offeror wants to revoke or withdraw an offer, that revocation is not effective until it is received by the offeree.

  If the offeree changes the terms of an offer in responding, the original offer has been rejected and the changed terms constitute a counteroffer.

• Consideration: The final element in the formation of a contract is consideration. Consideration in the legal sense is defined as something of value given in exchange for a promise or the performance of an act. Consideration can be money, goods, or services. All parties to an agreement must give consideration in order to create an enforceable contract.
• Contract Defenses: Even after you have a valid offer, acceptance, and consideration, you still may not have an enforceable contract. There are defenses to a contract which may make it unenforceable.
• Lack of Mutual Assent: When both parties to a contract are mistaken about a fundamental element in the agreement, the contract may be voidable by the party adversely affected.
• Illegality: If either the subject matter or consideration of a contract is illegal, the contract is void as a matter of public policy. For example, a contract for the sale of illegal drugs is a void contract.
• Capacity of the Parties: To be bound by a contract, a party must be competent to enter into the legal arrangement. Infants or minors, the mentally ill, and intoxicated people usually are not bound by the contracts they enter.
• Coercion and Fraud: Even if a person has the legal capacity to enter into a contract, the use of coercion, fraud or some other form of artifice in gaining a party's consent will likely make the contract voidable.
• Statute of Frauds: Contracts in many instances do not have to be in writing to be legally enforceable. However, under Florida law, contracts involving goods priced at $500 or more, promises to pay the debts of another, promises made in consideration of marriage, and promises that cannot be fulfilled within one year must be written to be valid.
• Parol Evidence Rule: Although not a defense to a contract, the parol evidence rule may affect the terms of a contract or how it is enforced. When the terms of a written contract are being argued in a court proceeding, the parol evidence rule prohibits the introduction of any agreements between the parties which conflict with the written contract and which were made prior to the contract.
• Breach of Contract and Damages: A valid contract can conclude in several ways: the parties can fulfill their duties; the parties can mutually decide to rescind the contract; or there can be a breach. A breach of contract can be minor or material. A material breach occurs when one party does not receive the substantial benefit of his or her bargain as a result of another party's inadequate performance or failure to perform.
• Money Damages: In most cases where an injury results from a contractual breach, the injured party receives money damages. Courts usually seek to place the injured party where he or she would have been had the contract been fulfilled. The injured party has a duty to mitigate damages or take reasonable steps to limit the extent of injury.
• Liquidated Damages: In situations where it would be difficult to determine damages in the event of a breach, parties may sometimes agree in advance to what damages will be paid.
• Specific Performance: There are some situations where money damages are inadequate. In contracts involving the sale of art, for example, the court may award specific performance (order the breaching party to fulfill the terms of the contract).

Contact our Civil Law Division

For additional information on contracts, please contact the Civil Division of NeJame Law. Our contract law attorneys have the skills and experience to handle fragile cases involving contract issues. We will set up an appointment to talk to you more about how we can assist you with your contract issues.