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A contract is an agreement to do, or not to do, a certain thing. Properly agreed-to contracts are enforceable by law. As discussed in the chapter, a contract has 4 distinct elements that include, agreement, consideration, the contractual capacity of the parties, and legality. Contracts are unenforceable if a party has a defense to a valid contract, which will allow that party to avoid enforcement of the contract. For example, if a contract was improperly drafted, this may make it unenforceable.
As a business owner, how important do you think contracts will be to the success of your business? After reading the chapter material what types of concerns would you have if it is your own business that is extending a contract to an individual or to a company for services? If it is your business that is entering into a contract with a company or an individual what type of concerns would you have?
Before you answer NONE, just think about what makes a contract enforceable or unenforceable. Think about how you would enforce a contract as a company that extended a contract and the customer doesn’t pay, what actions are available to you? What if your company is entering into a contract with a vendor and they don’t deliver on the contract, what could you do?
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