Reviewed by: Daniel Wagner
No matter if a contract is written or oral, there are certain requirements that must be met for the contract to be legally enforceable. In certain circumstances, a contract must be in writing to stand up in court. Given the nuances that may arise, it is essential that your agreement is well drafted to avoid any confusion or disputes between the two parties. To ensure that your contract is legally sound, our South Florida business lawyers are happy to review your agreement.
Essential Components of a Legally Binding Contract
Certain components must be present in a contract to hold up in a Florida court of law. These include:
Offer
A valid offer involves one party outlining specific terms, with the intention of creating a binding agreement. The offer is a willingness to enter a bargain with another party, which may be in writing or oral form. Some contracts are only enforceable if they are in writing (more on this later). The offer must be communicated to the other party.
Acceptance
Acceptance occurs when the party to whom the offer was made agrees to the proposed terms. Acceptance may be explicit, or it may be implied by the offeree’s conduct. Under Florida law, the acceptance must agree to the exact terms proposed by the offeror. If the offeree even slightly changes or modifies the terms, then this is considered a counteroffer.
Consideration
Consideration occurs when both parties exchange something of value. Consideration can be the exchange of money, goods, services, or a promise. Forbearance, or the act of abstaining from enforcing something to which you have a legal right, is a form of consideration. For example, a lender that agrees to reduce a homeowner’s mortgage payments during a time of financial hardship has entered into a forbearance agreement.
Mutual Consent
A valid contract requires a “meeting of the minds” between all parties involved. Both parties must have a clear understanding of the terms and conditions and what is expected of them. Mutual consent can be compromised if fraud, misrepresentation, undue influence, or coercion exists.
Capacity
Both parties must be at least 18 years old and have the mental competence to understand the contract terms. Mental capacity implies that each party privy to the agreement understands their legal obligations and the consequences of the contractual act. Legal capacity must be verified between the parties, or the contract may be void.
Legality
A contract must be based on a legal activity. For instance, a contract that involves the sale of drugs will not hold up in court. Besides being unenforceable, a contract that involves illicit activity may lead to criminal charges.
What Contracts Must Be in Writing in Florida?
While many verbal contracts are legally enforceable, Florida law requires that certain contracts be in writing to be enforceable. The Statute of Frauds states that a written contract is required for the sale of goods valued at $500 or more, as well as real estate contracts, lease agreements (excluding contracts with total payments less than $1,000), and any contract that cannot be executed within one year. In business law, most contracts must be in writing to ensure compliance.
Providing Clarity to Legal Contracts
Contractual terms that are not clearly defined can cause confusion and misunderstandings between parties. Unforeseen circumstances may prevent one party from fulfilling their contractual obligations, leaving the other party in financial distress. At Gottlieb Wagner, our South Florida business law attorneys want to help you succeed in any of your business endeavors. Our legal team is prepared to assess draft agreements to discern where clarification may be needed. Understanding the intricacies of a contract is best left in the hands of our legal team.
Reach Out to Our South Florida Business Law Attorneys Today
Although business laws vary between states, the team of legal professionals at Gottlieb Wagner is available to assist you with any of your business dealings. Our South Florida business law lawyers take a hands-on approach, allowing each client to move forward with confidence. To discuss your matter, contact us online or by calling (305) 919-7788.