Explain whether all types of agreement give rise to a valid contract
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Main Elements constituting A Valid Contract
Contract is an official agreement. It could be written or even be in oral. Contracts can be written by using formal or informal terms, or entirely verbal or spoken. It is a promise made between two or more parties that which allow the courts to make judgement. A contract has six important elements so that it will be valid which is offer, acceptance, consideration, intention to create legal relation, certainty and capacity. If the main elements are not in contract, it would be an invalid contract.
1.1.1 Offer
The first element in a valid contract would be offer. An offer or a promise or an agreement needs to be in contract because if there is no offer than there will be no contract. In the Contracts Act, 1950, the first elements in a contract would be offer. It is one of the elements to make sure that the contract is legally valid or acceptable. In a contract, it is very important that a party would make an offer. There is a difference of offer between an advertisement and an option. To make an offer, there should be at least two parties or even more so that it would be legally capable of entering into a contract. If the offer is accepted than it would constitutes to a legally valid contract. When an offer is being made, the other party or person would know what is being offer and what the person or party who made the offer expect to have in return. It is the same when anybody goes on a holiday, stays at a hotel and so on. For example, a family has made an arrangement with a tour agency to have a holiday at Hong Kong for a few days. The tour agency would make a contract by making forms to the family which would have to be filling up. The family member who fills up the form would have to be clear with the rules and regulations given by the tour agency company. Once it is fills up, the contract has been made between the family and the tour agency.
1.1.2 Acceptance
After having an offer in the contract, there should be acceptance. For a contract to be made there should be acceptance from the other party or person. When the other party is clear with the offer, there would make an acceptance once they are clear with the rules and regulations being offer in the contract. There will be no contract if the parties are still negotiating or discussing and have not made accept the offer. The person or party can accept the offer being made in writing or orally which is made verbally or being spoken out. For example, a tourist writes to hotel K requesting information about the cost and availability of accommodation for the week commencing on the 15th April 2011. The staff at hotel K answers the inquiry states that the accommodation available for that week would cost RM 600 and if the tourist responds with the deposit of RM 100 within a week, then the room will be allocated to him. If the tourist accepts the offer, then the contract has been made for the tourist and hotel K.
1.1.3 Consideration
Consideration is also a very important element in the contract. Consideration in a contract would mean the other person would be giving back something in return. It would be consider as an exchange which would be made between the promisee and promissor. There should be consideration in a contract so that it would be legally valid. For example, a customer in a fast food restaurant like McDonalds orders a set lunch which costs RM7.95. By ordering the set lunch, the customer is agreeing to pay RM7.95 as consideration. However, consideration does not give any threats to on ' line holiday contracts. Holiday services which are being provided by the on ' line holiday providers and also the consideration by giving something back in return which would be the payment money or even the payment made by the holiday makers would eventually follow the requirements for consideration of a contract.
Contract is an official agreement. It could be written or even be in oral. Contracts can be written by using formal or informal terms, or entirely verbal or spoken. It is a promise made between two or more parties that which allow the courts to make judgement. A contract has six important elements so that it will be valid which is offer, acceptance, consideration, intention to create legal relation, certainty and capacity. If the main elements are not in contract, it would be an invalid contract.
1.1.1 Offer
The first element in a valid contract would be offer. An offer or a promise or an agreement needs to be in contract because if there is no offer than there will be no contract. In the Contracts Act, 1950, the first elements in a contract would be offer. It is one of the elements to make sure that the contract is legally valid or acceptable. In a contract, it is very important that a party would make an offer. There is a difference of offer between an advertisement and an option. To make an offer, there should be at least two parties or even more so that it would be legally capable of entering into a contract. If the offer is accepted than it would constitutes to a legally valid contract. When an offer is being made, the other party or person would know what is being offer and what the person or party who made the offer expect to have in return. It is the same when anybody goes on a holiday, stays at a hotel and so on. For example, a family has made an arrangement with a tour agency to have a holiday at Hong Kong for a few days. The tour agency would make a contract by making forms to the family which would have to be filling up. The family member who fills up the form would have to be clear with the rules and regulations given by the tour agency company. Once it is fills up, the contract has been made between the family and the tour agency.
1.1.2 Acceptance
After having an offer in the contract, there should be acceptance. For a contract to be made there should be acceptance from the other party or person. When the other party is clear with the offer, there would make an acceptance once they are clear with the rules and regulations being offer in the contract. There will be no contract if the parties are still negotiating or discussing and have not made accept the offer. The person or party can accept the offer being made in writing or orally which is made verbally or being spoken out. For example, a tourist writes to hotel K requesting information about the cost and availability of accommodation for the week commencing on the 15th April 2011. The staff at hotel K answers the inquiry states that the accommodation available for that week would cost RM 600 and if the tourist responds with the deposit of RM 100 within a week, then the room will be allocated to him. If the tourist accepts the offer, then the contract has been made for the tourist and hotel K.
1.1.3 Consideration
Consideration is also a very important element in the contract. Consideration in a contract would mean the other person would be giving back something in return. It would be consider as an exchange which would be made between the promisee and promissor. There should be consideration in a contract so that it would be legally valid. For example, a customer in a fast food restaurant like McDonalds orders a set lunch which costs RM7.95. By ordering the set lunch, the customer is agreeing to pay RM7.95 as consideration. However, consideration does not give any threats to on ' line holiday contracts. Holiday services which are being provided by the on ' line holiday providers and also the consideration by giving something back in return which would be the payment money or even the payment made by the holiday makers would eventually follow the requirements for consideration of a contract.
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A contact is a mutual agreement between two individuals or two parties over a certain issue of common interest.
It is therefore not a guarantee that a contract may be honored by both parties as initially planned and agreed upon. One of the party may come out and violate the initial agreed deal which may render the contract invalid for that matter,
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