What is a contract? When you hire a service or buy any goods you enter a consumer contract, which is legally binding between the two parties involved, the buyer and the seller. A contract can be either made verbally or in writing.
Whilst verbal contracts are as binding as written ones, it may be difficult to prove and hence enforce their terms. A contract will be void if it is illegal, e.g. buying and selling illegal substances.
There are several elements required to make a contract binding:
- An offer (e.g. you ask to buy the computer)
- The acceptance (e.g. the shop agrees to sell you the computer at an agreed price)
- Consideration (e.g. you pay the money/deposit for the exchange of goods or promise of them)
- Intention (you and the shop both agree for the for the contract to be legally binding)
- Other factors include age, as a contract cannot be enforced by someone aged under 18 (or under 16 in Scotland).
Terms of a contract
The terms of the contract are what give you legal rights and can be:
- Express terms: those which are clearly and specifically stated and understood in the agreement e.g. delivery date, price, deposits etc
- Implied terms: those not clearly specified but implied by custom and practice or by legislation e.g. goods or services to be of ‘satisfactory quality’ or ‘match description’
- Conditions: these are vital to the contract. If a condition is broken, then the contract cannot usually be carried out.
Note that warranties are classed as secondary terms. If a warranty is broken then the remainder of the contract can be carried out, as the main purpose of the contract is not affected.
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