Contracts – Legally binding documents

Contracts are considered essential in today’s business. It is a legally binding document and hence is a must while entering into a business or a professional association. If you are under the impression that contracts are meant for parties who are dishonest and do not trust each other then you are wrong. Rather contracts show professionalism and improve the relationship between two parties. If a contract is in place all the rights of both the parties may it be individual or organization are protected. This ensures a smooth running of the business. Verbal agreements are no more valid and hence the need for written contracts came into existence. Oral contracts are confusing and can be twisted and turned according to the whims and fancies of the users. This is not possible in a written contract as the documents are carefully prepared by legal experts and there is no scope for confusion. A written contract explains the duties and responsibilities of both parties and hence are law abiding. Only a written contract can be referred to incase of any misunderstanding. They stand valid in the court of law. All difference of opinion can be wiped away if you have a written contract.

Contracts are again simple documents that have a legal binding. Once the parties agree to enter into a bargain a contract can be designed. A contract is two way, any contract needs to be agreed upon on common grounds. Needless to say if the offeree is not happy with the proposal, no contract can be drawn. Post negotiations once the parties mutually agree upon the association the contract is drafted. A contract can be signed only by authorized signatories, this makes a contract legitimate. In case of individuals both the parties need to be above the legal prescribed age to enter into a contract.

Anything that is exchanged between two parties be it money or property or goods need to be bound by a contract. For businesses that conduct transactions over the internet, electronic contracts need to be in place. Digital signatures are valid these days and can be used to sign an electronic contract form. Electronic contract business forms are legal and are valid in the court of justice. Electronic signature can be a name typed at the bottom of the contract form, below the words “I Agree” or “Accepted”. This can make the electronic signature valid. The mark can act as a signature and this signature should be ascribed by an authorized signatory.