At the core, the elements of contract formation are quite simple and are oftentimes made more complex that necessary. The definition of contract is a bargained for exchange of promises. For an enforceable contract, there are three elements that are essential. The three elements are an offer, an acceptance and a consideration. The offer is simply the proposal of the contract. For instance, person
. 1 may propose an offer to buy the house for $200,000. The person selling the house then has the option to either accept or reject the offer, which in the case of rejecting, the parties go back to step one and another offer is placed on the table. If the offer is accepted, the parties can move on to consideration. " Consideration" is a fancy term for the bargained for exchange. Even token consideration is sufficient to make a contract enforceable. Courts make it a policy not to look at the adequacy or value of the exchange. The classic example is that a peppercorn is enough payment.The Internet made the making and enforcing of contracts a bit more tricky. Proving the existence of the basics got hard and oftentimes impossible. This was because negotiations were no longer face-to-face or phone-to-phone and it became extremely difficult to even determine whether an enforceable contract had been formed.The internet caused many questions like: Who were the contracting parties? Did Party B even have notice of the offer or its terms? What is acceptance in an electronic environment? Does it just include a "yes" over an email? Does it include clicking a box that says "accept the terms of the agreement"?Contracts are integral to business and understanding the basics of contract law, especially in an electronic environment, can be critical for any business. Get familiar with the basics of contract law. It could really save some money in the long run. More reference links: http://www.seniormag.com/legal/contractelements.htm http://www.dummies.com/how-to/content/essential-elements-of-contract-formation.html
