Simply stated, contract law is centered on a promise or a set of promises. And if the promise is broken (breached), then the law provides a remedy for the party who was harmed (damaged) by the breach. Contracts can be relatively easy to form: first, there must be a meeting of the minds where one party makes an offer to another party and the second party accepts the offer; and second, something of value must be bargained for and exchanged. An example of this bargained for exchange is cash paid in exchange for goods or services. These promises can be made either in writing or orally.
While the formation of a contract can be simple, the disputes that arise regarding whether the contract was properly formed are numerous. It is important for a party to have a knowledgeable contract law attorney guide it through the process of what constitutes an offer, and perhaps even more importantly, what exactly constitutes an acceptance of that offer since the way in which an acceptance is made can be tricky at times. Other factors to consider is whether the things bargained for constitute the value needed to reach the threshold of contract formation, or if the courts would likely see it is merely a gift or gratuitous promise.
Once it has been determined that the promises need to me memorialized in writing, it is also important to have an attorney who understands, and who can communicate to the client, the significance of the representations being made, at what time in the process the representations are binding (e.g. at the signing of the contract only or both at the signing and on the closing date of the contract), and what the consequences may be if there is a misrepresentation. In drafting the contract, the experienced attorney knows how to avoid many of the common pitfalls and mistakes that lead to litigation. The drafting of a contract is art in itself.
In the event there is a breach of contract, the damages that are recoverable differ based on the breach and whether fraud was involved. Generally, the idea behind calculating damages in contract law is to put the harmed party in the same place as if the contract had been fully performed (expectation damages). Another type of damages may include out-of-pocket expenses. Making a determination whether a contract has actually been breached, what kind of breach, and the types of damages and relief a party is entitled to can be very confusing. An experienced contract law attorney, particularly one experienced in the appropriate jurisdiction, can help sift the confusing nature of contract law and help his clients avoid litigation by ensuring that the transaction is handled properly in the early stages of the deal.
- Does my contract need to be in writing?
- What is the difference between contract law and tort law?
- What is the Statute of Limitations for contract breach?
- How do you form a contract?
- Can a minor be sued for breach of contract?
Additional Contract Law Resources:
If you’re evaluating contract law issues for your business, it is important to find an experience contract law attorney in Encinitas. Click here or call 760-632-1100 to schedule a free consultation.