Definition of Contract

Contract can be defined as: An agreement

between two or more parties on creating legal
obligations enforceable by law, and producing it’s
legal effects for both parties, this obligation is either
to owe something (Sale contract) or to do
something(construction contract) or to Abstain
from doing something (non-competition contract).
 Essential Elements of
Contract
The law requires certain elements of the contract, if these
elements are not present , a court will not find that
contract exist between the parties.
These Elements are:-
1. Agreement. 3. Legality.
2. Consideration. 4. Capacity.
 First: Agreement
The Agreement in the contract means: that
the two parties must agree on the subject of
the contract between the Offeror (The person
who makes the offer) and the Offeree (The
person who receives an offer from another
party).
 (A) Offer

Offer can be defined as: A promise made

by person to do something if another
person performs an act or promises to do
something.
 Essential Elements of the
Offer
1. Offer must be seriously intended.
2. Offer must be definite in price and quantity.
3. Offer must be communicated by the Offeror to the
other Offeree before the offer can be accepted.
 Termination of an Offer
1. Rejection: when the Offeree refused the offer made by the
offeror.
2. Counteroffer: changing the terms of the original offer.
3. Revocation: is the legal right to withdraw an offer in any time
before it is accepted.
4. Death of the offeror or illegality and impossibility.
 (B) Acceptance
The Essential elements of the Acceptance:
1. Theacceptance must be made by the offeree.
2. Acceptance agree (contact) with the offer.
3. Acceptance must be communicated to the offeror.
 Second: Consideration
Consideration: is something has a value to be exchanged
in order to bind a contract.
Or
Something that encourage one to make a contract
Ex: cars, real estate are legal considerations.
While drugs, unlicensed weapons are illegal considerations.
 Third: Legality

If the parties enter into an agreement that has an illegal

purpose, it may not only be enforceable but illegal as well.

Ex: if the contract includes any agreement to commit a

crime.
 Fourth: Capacity
Capacity means that not everyone is permitted to enter
into contract that would bind them by law.
Incompetent parties:
1- Minors (persons who doesn’t attained majority).
2- persons who is under the influence of Alcohol.
3- Persons who suffers Mental illness.
 Defenses for a breach of
contract
1- Fraud: is entering into a contract intentionally
making a false statement about material facts.
2- Duress: is forcing someone to enter into a contract
by using violence or threats of violence.
 Defenses for a breach of
contract
3- Mistake: is an error about certain fact made by
only one party to a contract.

4- Undue influence: is a power used to make

persons enter into a contract against their own will.