Discuss Impact Different Types Contract is agreements which are legally binding on those parties who are enter into a agreement. The agreement made by the parties is willfully. The parties are bound with the contract. The parties have liabilities against each other automatically. (ACCA F4, 2009) (Lawhandbook.org.au, (2015)
The essential elements for making the valid contract are:
Intention to create legal relations
Agreement – The first essential condition for the valid contract is agreement. There should be an agreement between the parties. For making the contract there must be the offer and acceptance from both the side. One party has to make offer and other party has to accept the offer for the valid contract. if there is no offer or no acceptance has been made by the person then there is no legal contract between them or there is no valid contract. the offer which is made by the party must be clear, definite , must be communicated to the other party.
Case- (Harvey v. facey, 1893)
Acceptance can be made by orally or in written or in any manner which is assumed that it is acceptance of the contract.
Case- (Entores v Miles Far Eastern Corporation (1955)
Consideration– the second element is the consideration, in this there should be a consideration between the parties. There should a promise given by the parties that they will pay the consideration. The promise is given by the promisor to promisee. When the promisor take the promise form the promisee that he has done or he is abstained from doing something in the past, he does or abstain from doing in future, or give promise not doing something in the future. There should be some value which is passed form the one party to other party.