Essay about The U.s. Legal Law

1431 Words Sep 26th, 2016 6 Pages
The U.S. legal system can be very complex and confusing to someone not in the legal profession and requires many years of study and practice to be proficient at applying its principles. Even though it is difficult to grasp all the aspects involved in the different facets of the law as it pertains to business, understanding at least the basics of contract law is vitally important for managers and business owners because they will most likely be dealing with contracts on a regular basis in order to successfully meet their business obligations. A contract is a way to describe and define the expectations of each party in a business relationship or transaction, it provides a measure of certainty, spells out what the consequences are if either party fails to perform in accordance with those written terms and conditions and provides a framework for resolution if a dispute or legal action occurs. Kronman (1985) describes a contract as a legally enforceable agreement, one the state will enforce by placing its coercive powers at the disposal of either party if the other fails to perform (p. 5). Schwartz, Alan and Scott (2003) also say that contract law should facilitate the efforts of contracting parties to maximize the joint gains and contractual surpluses from transactions. To illustrate the basics of how contracts work, let us look at an example of contract law as it relates to employment.
Five Elements of a Contract The scenario for our example is as follows: The…

Related Documents