In any establishment, there will always be an agreement or contract. The purpose of contracts is to ensure that the agreeing parties get what they deserve out of the agreement. To understand how contracts work, here are some of its legal elements:
- Offer â In any contract, there is always an offer coming from one of the parties. Oftentimes, the party that makes the offer is the one who writes the contract. For instance, in an employment contract, the offer is the job.
- Acceptance â Even though the other party made an offer, there will be no agreement unless the other participant accepts the offer. In the example, the job applicant is the party who will accept the employer's offer, that is, the job.
- Objective of the contract â Any contract would be useless if it does not have any goal. The agreement of both parties should have a common goal, which they both want to achieve. Still in the example, the objective for the employment contract may be to earn profit or for the advancement of the company.
- Meeting of the minds â In a legally-binding contract, both parties have their own share of responsibilities to fulfill the conditions of the agreement. For instance, the employer has the obligation to pay the employee for his work, while the worker is required to provide valuable services to his boss.
- Competency of parties â Even before entering the contract, both parties should be qualified to participate. For example, job applicants can only enter an employment contract with an employer if they are currently unemployed and they satisfy the requirements of the position.
- Penalties and legal action â In case one party violated a term or clause in the contract, the other party has the right to file legal charges against it. Necessary penalties would also be imposed.
These are the legal elements that make up a binding contract. It is very important that both parties understand these 6 elements in order to get the most out of the agreement. For parties who want to enter a contract or agreement, they may seek legal assistance from a Los Angeles labor attorney.
Legal contracts and agreements are essential in employer-employee and seller-buyer relationships. Because these contracts usually pertain to monetary issues and profit, both parties should understand them well. If they find some conditions unclear, they can just ask their LA employment lawyer.