Common Law Of Contracts And Its Effect On Contractual Relationships

830 Words Jun 7th, 2016 4 Pages
Every single contract is an agreement; however, not all agreements are contracts. In order for an agreement to develop into a contract, there are certain components that need to be fulfilled; offer, acceptance, consideration, capacity, and legality. Some contracts contain a contract clause, which regulates state as well as local government; however, it does not limit the federal government’s power to impact contractual relationships.
The first of these elements is offer; offer entails a particular promise in addition to particular demand. According to the common law of contracts offers must contain definite terms, that is to say the terms of the contract have to be specific as well as definite.
The second element is acceptance of offer; in order to create a legitimate, enforceable contract this is require. Acceptance of an offer can be in one of two forms, bilateral or unilateral. When an offeree makes the required promise the offer enters into a bilateral contract. For example, if someone offers you a certain good or service for $500 on a 60-day credit term, and you accept; you are promising to pay $500 within those 60 days. The second form of acceptance of offer is unilateral. Unilateral contracts are established by performing an act that is requested, and not by making a promise. For instance, if the new offers a reward for information leading to an arrest, the reward is only given when the act of giving information is done. “The language of the offer determines whether…

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