Contracts Flashcards, test questions and answers

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What is Contracts?

Contracts are legal agreements between two or more parties which create obligations that each party is legally obliged to fulfill. Contracts are used in a variety of situations, from business transactions to employment agreements. A contract is formed when there is an offer made from one party and accepted by another party. The agreement must include all agreed upon terms and conditions in order for it to be enforceable by law.The most important part of any contract is its terms and conditions, which define the rights and responsibilities of each party involved in the agreement. These can include things such as payment schedules, delivery deadlines, warranties, dispute resolution methods, and much more. It’s important for both parties to read over the contract thoroughly before signing so they are aware of their obligations under the agreement.In addition to defining each party’s responsibilities and rights, contracts also provide a clear understanding of how potential disputes will be handled should they arise during the course of fulfilling the agreement. This helps ensure that both parties know what action they can take if either one fails to meet their contractual obligations or if there are disagreements about interpretation of any part of the contract. Contracts can be written or oral but it’s always best practice for them to be put into writing so that all terms are clearly outlined and agreed upon by both parties before work begins on fulfilling them. This helps ensure that there is no confusion around expectations or misunderstandings during performance which could lead to costly disputes down the line.