What Are the Five Features of a Legally Valid Contract


A legally valid contract is an agreement between two or more parties that is enforceable by law. It is essential for individuals and businesses to understand the core features that make a contract legally binding. In this article, we will explore the five key features of a legally valid contract.

1. Offer and Acceptance

The first key feature of a legally valid contract is the offer and acceptance. An offer is a proposal made by one party to another, outlining the terms and conditions of a potential agreement. Acceptance is the positive response to the offer, indicating that the other party agrees to the conditions outlined in the offer. Both parties must have a clear understanding of the terms of the offer and acceptance for a contract to be legally binding.

2. Intention to Create Legal Relations

The second feature of a legally valid contract is the intention to create legal relations. Both parties must have the intention to enter into a legally binding agreement. If there is no intention to create legal relations, the contract will not be enforceable by law.

3. Consideration

Consideration is the third key feature of a legally valid contract. Consideration refers to something of value that is exchanged between the parties. This can be money, goods, or services. Consideration must be present in a contract to ensure that both parties have something to gain and to provide a clear indication of the agreement’s enforceability.

4. Capacity

The fourth feature of a legally valid contract is capacity. Capacity refers to the legal ability of the parties to enter into a contract. This means that both parties must be of legal age, mentally competent, and not under duress or undue influence.

5. Legal Purpose

The fifth feature of a legally valid contract is legality of purpose. A contract must have a lawful purpose for it to be enforceable by law. Contracts that violate public policy or involve an illegal activity are not considered legally valid.

In conclusion, understanding the key features of a legally valid contract is essential for anyone entering into an agreement. These features include offer and acceptance, intention to create legal relations, consideration, capacity, and legality of purpose. By ensuring that these features are present, parties can enter into a contract that is enforceable by law.