Steps involved in contract
The steps involved in the contract are –
1. Proposal and its communication
2. Acceptance of proposal and its communication
3. Agreement by mutual promises
4. Contract
5. Performance of Contract.
All agreements are not contract. Only those agreements which are enforceable by law are ‘contracts’.
Following are essential requirements of a valid contract.
(Acronym: OAC CE CLP)
1. Offer and its Acceptance (Agreement)
2. Free Consent of both parties
3. Mutual and lawful Consideration for agreement
4. It should be Enforceable by law.
Hence, intention should be to create legal relationship. Agreements of social or domestic nature are not contracts
5. Parties should be Competent to contract
6. Object should be Lawful (Legal capacity)
7. Certainty and possibility of Performance
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