Contract

Management

By: Sakshi Mehta

What is a Contract?

A contract is a legally binding agreement between

two or more parties that creates obligations to do or
not do certain things. Contracts are an essential part
of business and personal transactions, providing a
framework for individuals and entities to define their
rights, responsibilities, and expectations.
Difference between a Contract and an Agreement?
Feature Agreement Contract
A mutual understanding or arrangement A legally binding agreement between two or more
Definition between two or more parties regarding their parties that creates obligations and is enforceable
rights and obligations. by law.
Enforceability Generally not enforceable by law. Legally enforceable in a court of law.
Can be formal or informal, but certain types of
Formality Can be formal or informal, written or oral. contracts are required to be in writing to be
enforceable.
May or may not be intended to be legally Intended to create legal obligations and
Intent
binding. consequences for non-compliance.
Lack of legal consequences for non- Non-compliance may lead to legal consequences,
Legal Consequences
compliance. such as damages or specific performance.

May lack essential elements required for a
Elements
contract, such as consideration.
Example A promise to meet a friend for coffee.
Requires essential elements like offer, acceptance,
consideration, legal capacity, and a legal purpose.
A business agreement to supply goods in exchange
for payment.
 Certainty and
Possibility of
Performance Offer

Legality of
Purpose
Key elements of a Acceptance
Contract
Intention to
Create Legal
Relations
Consideration
Legal
Capacity
Contract Lifecycle Management Process

• Pre-Contract Phase
• Contract Creation and Negotiation
• Execution and Implementation
• Monitoring and Performance
• Renewal or Termination
Important Clauses of Contract
Identification of the Parties (Preamble) Confidentiality and Non-Disclosure

Recitals (Background) Indemnity and Liability (compensation for

harm and loss)

Definitions (to ensure clarity and prevent Force Majeure (Describes the conditions
misunderstandings of any key terms) under which either party may be excused from
performance due to unforeseen circumstances
beyond their control)

Scope of Work or Description of Service Dispute Resolution

Duration and Termination Governing Law

Warranties Amendments and Modifications

 Concepts to know
1. Difference between Amendment and Addendum?
2. Difference in the meaning of the term ‘May’ and ‘Shall’?
3. What is a:
• Contracting Party
• Counterparty
• Effective Date (where to find it)
• Expiry date
• Date of renewal
• Parent-Child Relationship
4. Non-Disclosure Agreements (NDAs)
5. Master Service Agreement (MSA)
6. Statement of Work (SOW)
Thank You!
If you have any questions, please feel free to reach out.

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