A contract is defined by L.B Curzon’s “A Dictionary of Law” to be a legally binding agreement. In other words, it is an agreement between 2 or more parties which the law/court will honour. For instance, a building contract, an employment contract or a loan agreement and so on.
For a contract to be recognized by law, it must have been entered freely and voluntarily i.e. there must have been no form of undue influence while negotiating the contract. For instance, an agreement for the sale of an hotel when the seller is held at gun point by the buyer will not be recognized by law if such circumstances are brought to the knowledge of the court.
Contracts can be in different forms depending on the nature of the agreement. For example, contracts for the sale of land are “contracts under seal” and can also be called deeds. Such contracts are usually required to be in writing, signed, sealed and delivered. Simple contracts on the other hand include oral contracts and contracts which include some little writing. Implied contracts arise from the assumed intentions of the parties. While, contracts of record, arise from obligations imposed by a court’s decision.
A contract evolves in stages beginning from the offer to the acceptance of that offer and finally to its execution/ termination. These stages must be supported by consensus among the parties; a genuine intention to enter contractual relations; valuable consideration and the legal capacity of the parties to enter into the agreement.
Please note, that illegal contracts will not be recognized by law. This means any contract that involves any illegality will not be honoured by the courts. As an illustration, in Nigeria, an agreement to buy or sell stolen property will not be recognized by law because dealing in stolen property is in itself a crime and an illegality.
It is recommended that before you sign an agreement, you evaluate if the terms constitute a valid contract and all parties are clear of their respective duties and obligations under the contract. Also, do not hesitate to seek counsel from a legal practitioner if you need to.