What is a contract? A famous formula, well-known to all law students says: 1. _ + ACCEPTANCE + CONSIDERATION = CONTRACT. In other words, if party A offers to do something for party B, and if party B accepts party A’s offer, and if party B has given (or promised to do so) something valuable in return (consideration), they have an 2. _ (legally valid and binding) contract.
The 3. _-law term consideration is often money, but it can be anything else of value to either one or both parties. Both parties provide consideration for the other party. For example, party A may agree to sell a villa on the Adriatic coast (= consideration) in 4. _ for party B’s million Euros (= consideration). Party C may agree to provide maintenance work (= consideration) in exchange for food and accommodation from party D (= consideration). The consideration for a promise must be given in return for that promise. Hence the maxim – past consideration is no consideration.
What do you think? A window cleaner cleans John’s windows without being asked to do so. John agrees to pay him the next day. When the window cleaner returns to collect the money, John refuses to pay. Was there a contract between John and the window cleaner?
The answer is ‘no’. An important difference between contracts in 5. _ law (developed from Roman codified law and practiced in most European countries) and common law (based on the customs and practiced in English-speaking countries) is that in civil-law 6. _, a promise does not need consideration in order to be enforceable. For a promise to become an enforceable contract, the parties must agree on 7. ___ terms of the contract, such as price and subject matter.
What form does a contract take? The term covers much more than formal legal documents headed by the word ‘contract’. A contract can be in the form of a written agreement or even conversation, provided that three essential elements are present (express contracts). A contract may exist where the three elements are 8. _ by the actions of the parties even if no documents change hands and no conversation takes place (implied contracts). For instance, a person who parks their car on a private property has entered into an implied contract with the owner to pay fees for 9. _. However, certain contracts must be written and signed in order to be enforceable, e.g. those involving the sale and transfer of real property (Am Eng ‘real estate’).
