An agreement (mutual understanding) between two private parties that creates mutual legal obligations.
contract
ELEMENTS OF CONTRACT
- Offer
- Acceptance
- Mutual assent (also known as “meeting of the minds”)
- Consideration
- Capacity
- Legality
- Contract Classification – writing, verbal or action
The contract in which one of the
two parties has an option to
enforce or rescind it
VOIDABLE CONTRACT
The type of contract which cannot
be enforceable
void contract
is an expression of willingness to contract, made with the intention that the offer shall become binding as soon as it is accepted by the person to whom it is addressed.
offer
HOW OFFER IS MADE
- Express
- Implied
When an offer is expressed by words spoken or written it is termed as
express offer.
means an offer made by conduct. when one person allows the other to perform certain acts under such circumstances that nobody would accept them without consideration it will amount to an offer by conduct and the permission of the party ,who is benefited by such performance, will amount to his acceptance such an acceptance will be asked to pay for it.
implied offer
is the final and unqualified expression of affirmation to the terms of the offer.
acceptance
is a phrase in contract law used to describe the intentions of the
parties forming the contract. In particular, it refers to the situation where there is a common understanding in the formation of the contract.
meeting of the minds
Law (in a contractual agreement) anything given or promised or withheld by one party in exchange for the promise or undertaking of another.
In order to have a binding contract, there must exist an element of
consideration
means the person entering into the contract has a legal competence. This means they are competent to perform the act they’re agreeing to in the contract. A person must have a sound mind to get in this situation.
capacity
Some people aren’t able to enter into a contract, as they’re not capable. This includes the following:
➢ Those who are insane
➢ Minors or infants
➢ Those who are under the influence of drugs
➢ Persons who are bankrupt
is an involved warranty that an agreement or contract strictly follows the law of a particular jurisdiction.
legality
Agreement between a client(Employer) and a Contractor
under which the Contractor agrees to supply materials and labor for construction.
construction contract
TYPES OF CONTRACTS
➢ Lump Sum Contract
➢ Re-measurable
➢ Cost Plus
➢ Guaranteed Maximum Price
also known as fixed price contracts, are the most basic type of construction contracts. That’s because they outline one fixed price for all the work done under them. For this reason, they are extremely common in construction.
lump sum contracts
work best for projects in which the scope of work is not well- defined. Time and materials contracts reimburse contractors for the cost of materials and establish an hourly or daily pay rate.
Remeasurebale Contract
otherwise known as cost-reimbursement contracts, involve the owner paying the contractor for the costs incurred during the project plus a set amount of money for profit, which can be determined by a percentage of the total price of
the project.
Cost-plus contracts
establish a cap on the contract price. With this type of construction contract, the property owner won’t exceed the contract price. Any material or labor costs above that price should be covered by the contractor.
Guaranteed maximum price (GMP) contracts
also known as “interpretation against the draftsman”, is a doctrine of contractualninterpretation providing that, where a promise, agreement or term is ambiguous, the preferred meaning should be the one that works against the interests of the party who provided the wording.
Contra Proferentem
is a legal doctrine prevents a person who is not a party to a contract from
enforcing a term of that contract, even where the contract was made for the purpose of conferring a benefit on the third party.
Privity of Contract
operates concurrently with the main
contract and provide direct contractual rights for parties, who would not otherwise have a right of action, as a result of privity of contract.
A Collateral Warranty
is a document declaring the preliminary commitment of one party to do business with another. The letter outlines the chief terms of a prospective deal and is commonly used in business transactions.
letter of intent
