CONTRACTS AND AGREEMENTS

24 September 2018

• Law blog
• employment contracts
• contract law Liverpool
• corporate and commercial law liverpool
• corporate and commercial solicitors liverpool
• corporate and commercial solicitors wirral
• Joint-venture agreements
• share purchase agreement
• distribution agreement
• shareholder agreements
• partnership agreements

A contract is a legally binding agreement in which an organisation or individual offers the terms and conditions of the contract to one or more parties followed by a process of negotiation, acceptance, and agreement to the offered terms. 

Before a contract can be deemed enforceable by law, the process of consideration must take place, which means all parties must mutually consent to the terms and conditions of the contract. I.e. Party A promises to provide a service in return for Party B’s payment.

A vital element to consider when drawing up a legal contract is the intention of all parties. For example, in some cases there is no initial intention to make an agreement legally binding, therefore it cannot be classified as a contract by law. It is sometimes assumed that an agreement is legally binding, especially when dealing with commercial contracts.

If one or more parties decide to bring a particular case to court with the argument that the agreement in place is not legally binding, then they must produce evidence to support this statement.

If an agreement dispute is brought to Court and it is legally binding, the terms and conditions of the contract will be scrutinised to ensure that they are set out properly and in a comprehensible manner. If the Court finds that the terms and conditions are not up to standard, then the agreement can be deemed unenforceable by law, and is therefore not classified as a contract.

In most cases, agreements are formed through written contracts, however in some instances a verbal agreement can be used to formalise a contract. If an agreement dispute goes to Court and there is no evidence of a written contract, then the court must consider the agreement in practical terms through exchanges, services, and promises.

There are a variety of agreements enforceable by law including:

• Shareholder agreements: a legally binding contract between two or more shareholders within the same publicly-listed company, and the liability is placed a separate entity to the parties involved.

• Partnership agreements: similar to shareholder agreements, differ in that a partnership agreement is for non-registered organisations, and that liability is placed on the partners within the agreement.

• Cross-option agreements: utilised for shareholder protection within a limited company. There are two options when dealing with shares:

           - Call option: allows the surviving shareholders to purchase the shares of a deceased      shareholder.

          - Put option: gives the owner of the shares the right to sell the shares on to other   shareholders.

•  Share Purchase agreements: a legally binding agreement relating to the sale and purchase of shares in a company.

• Joint-venture agreements: an agreement usually set out by two entities wishing to collaborate within their line of business on mutual terms.

• Distribution agreements: a written agreement between a supplier and distributor covering conditional terms including: costs, timescales, damage liability, and various other conditions.

Here at Three Graces Legal we can assist you or your organisation with any legally binding contracts or agreements for your protection.

Please contact us at 0151 659 1070