Question

a contract creates. a) rights and obligations of the parties to it. b) mutual understanding between the parties to it . c) obligations of the parties to it. d) mutual lawful rights and obligations of the parties to it.​

Answer 1

The correct answer to this question is option d) mutual lawful rights and obligations of parties to it.

Explanation:

• A contract is an agreement amongst parties that are bound by law.  

• Moreover, the rights and obligations of the parties in a contract must be enforced by the court.  

• The court must coerce the performance of contractual obligations by the party in default or, more ordinarily, must award compensations for breach of contract.

• For a contract to be established, four basic elements must be present

• 1. Offer,  

• 2. Acceptance,  

• 3. Consideration and  

• 4. The intention to create legal relations.