What is required to form a contract in California?

There’s much more to developing a contract than simply signing your name to a document, in the case of a written contract, or making a promise to do something in exchange for something else in an oral contract. In order for a contract to be considered valid in the State of California, the contract must contain the following:

  • Parties: There must be two or more parties who have the ability to enter into a contract. Typically, this means that the parties must be over the age of 18, the age considered to be an adult. All adults who enter into a contract must also be of sound mind, meaning they do not have any mental deficiencies and are capable of understanding the terms of the contract and what they are agreeing to in the contract. Finally, the adult entering into the contract must not be an inmate in prison and prohibited from entering into the contract for the specific subject matter, such as acquiring material related to gambling, inciting violence, etc. Once these conditions are met, then the contract may be signed (or in the case of an oral contract, orally agreed to in between the parties) and considered valid.
  • Consent: Consent from the parties. No person signing a contract must be signing against their will. They must have the capability to understand what they are signing and consent to carry out the terms they are agreeing to in the contract.
  • The agreement outlined in the contract must include something of value. This means that one or both parties agrees to give something of value to the other. This even includes an agreement to do something or an agreement not to do something. Generally speaking, whatever the parties signing the contract consider valuable will fulfill this requirement.
  • Other Terms. Agreement upon the terms of the contract. Dependent upon how the contracted was worded, it is assumed that the parties who signed the contract and agreed to it therefore agree to the terms outlined within the contract.

If a contract comes under dispute and one of the parties wishes to establish the contract as null and void, they may have a case if they can prove that one or more of the aforementioned requirements was not established within the contract.

The law of contracts is complicated.  As such, if you are considering entering into a contract with one or more parties to agree to a delivery of goods, services, promises of performance, or real estate, it is best to consult with an attorney experienced in the development of contracts, such as the attorneys at Chilina Law Firm. With a knowledgeable attorney on your side, you will have the ability to ensure the validity of the contract to protect your rights and avoid a legal battle at a later date should a dispute regarding the contract, arise.

Authored by Greg Chilina and Co-Authored by Karen Chilina

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