There are six elements that make a contract legally binding or valid. Not all contracts need to be in writing.

Contributor

Evelyn Tadros

Barrister

What is a contract?

Last updated

1 July 2020

A contract is a legally binding agreement between two parties. A contract is valid and enforce­able if the agreement contains sufficient evidence of the following elements:

1 an offer and an acceptance;

2 a common intention between the parties to create binding relations;

3 the giving of ‘consideration’ for the promise;

4 legal capacity of the parties to act;

5 genuine consent of the parties; and

6 legality of the agreement.

An agreement that lacks one or more of these elements is not a valid contract.

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