A Connecticut business contract is the foundation of most business engagements in the state. They spell out our rights, duties, and obligations. Furthermore, there are legal remedies against breaches of contract. These consequences ensure that contracting parties respect the agreement. Unfortunately, though, many business people don’t know what makes a contract binding and enforceable.
This ignorance is deadly because it could make a business owner sign and execute their obligations under an unenforceable contract. Fortunately, this doesn’t have to be your lot in business. That is if you hire experienced Connecticut business lawyers to review your contracts before signing them.
Elements of a Connecticut Business Contract
Certain elements must be present in Connecticut business contracts. The effect of these elements is to render your agreement legally enforceable. So, we explain these crucial features below.
Offer
The first stage of a Connecticut business contract is the offer. This is usually a promise by one party to another to do or refrain from doing something. In addition, this party makes the offer in exchange for a commitment from the other party. Sometimes, the contract doesn’t demand another promise. It, instead, requires the performance of or forbearance from an action. Furthermore, the exchange could be monetary too.
For example, imagine a furniture company offers to sell furniture to a school. Here, they could attach dollar amounts to the furniture they’re delivering to the school. Notably, the one making the offer is the “offeror.” On the other hand, the “offeree” is the party to whom the promise is made. Usually, an offer states the terms upon which the offeror is ready to sign the agreement. It’s then the right of the offeree to accept or reject these conditions.
Acceptance
The other party or parties must accept a contractual offer before it becomes binding. An acceptance is merely an expression of consent to the terms of the agreement. Sometimes, the offeree must accept the offer in a particular manner. Therefore, the offer letter, for instance, often specifies the mode of acceptance.
However, the offer often doesn’t specify any form of acceptance. Here, the offeree can consent to the contract in any reasonable manner. In addition, acceptance must be unequivocal and unconditional. Sometimes, Connecticut business people reply to one offer with another offer.
This isn’t a valid acceptance. Instead, the law considers it a counter-offer. Finally, silence or inaction after a contractual offer is generally not regarded as acceptance. The exception to the preceding is where the parties usually make agreements in this manner.
Consideration
Contracts must be mutually beneficial to the contracting parties. Therefore, the offeror and offeree must exchange valuables. It’s this value that induces both parties to agree to the arrangement. Furthermore, the law calls this exchange of valuables “consideration.”
Notably, Connecticut law recognizes various forms of consideration. They include money, properties, promises, actions, and inactions. For example, let’s reconsider the furniture selling scenario above. Now, imagine that the school finally pays $2,000 for the furniture. Here, $2,000 is their consideration in the furniture selling contract.
It’s crucial to understand things that cannot constitute consideration in Connecticut law. They include:
- Past Consideration: Something of value, previously given.
- A Pre-Existing Duty: Where a contractual party was already under an obligation. Agreeing to fulfill that pre-existing duty is not valid consideration.
- An Illusory Promise: This is a promise the promisor either can neither fulfill nor should fulfill.
Competence and Capacity
Finally, parties to a contract must be competent to enter into such binding agreements. This means that the contractual party must not be a minor under Connecticut law. In Connecticut, the age of majority is 18 years. So, once you’re above 18, you can legally enter into contracts. You mustn’t sign a business contract with a minor.
This is because such a contract is voidable at the minor’s discretion. Other groups with limited contractual ability include:
- Mentally incapacitated persons
- Intoxicated people
Therefore, before signing a contract, check that the other party is competent and of full capacity.
Connecticut Business Lawyers Can Ensure Your Contracts are Binding
Are you a business owner in Connecticut? If you are, then you most likely sign different contracts. If you’re anything like the average businessman, you may not know the crucial elements to look out for in your contracts. However, you don’t need to know all these if you hire the best Connecticut business lawyers.
Our business attorneys have extensive experience representing Connecticut businesses. Therefore, we know what to add to your contract to ensure it is legally binding. We also advise and represent clients in many other sectors regulated by Connecticut business law. So, calling our law offices today to schedule an appointment would be an excellent decision.