In my 30 years of practicing law including contract law and contract/business litigation what has most surprised me is the many people who rely on handshakes and poorly drawn contracts. These people are looking for litigation. The main explanation for their failure to hire a lawyer to draw the agreement is that they wanted to save the expense of an attorney. A simple contract could cost as little as a few hundred dollars but a resulting law suit would cost into the thousands.
A contract is a map of the relationship between the parties and its terms should cover every contingency that can be imagined and outline the course that will be taken in the event of a controversy. It can be simple or complex depending on the intention of the parties. Although it is important to detail the duties of the parties and how income should be handled it is more important that it detail what is going to happen in case of a dispute – a matter that most new in the relationship would prefer not to consider.
The elements of a contract depend on the type of contract that is being entered into. For example the general elements of a contract for a joint venture, there must be a community of interes in the performance of a common purpose, joint control or right tof control or right of control, a joint proprietary interes in the subject matter, a right to share in the profits and a duty to share in any losses which mat be sustained.
The statute of frauds requires that any contract that cannot be performed in one year must be in writing. Therefore even a verbal agreement can be enforced so long as the agreement can be performed in one year. However, in any contract that is ambiguous parole evidence (extrinsic evidence) can be introduced to prove up the terms of the contract.
In some cases the court will imply that a contract existed based upon the actions of the parties. The court will do so to avoid the unjust enrichment of one party.
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