Illinois Contract Law

A contract is a promise or an agreement between two or more persons or organizations to do or to refrain from doing a particular thing in exchange for something of value. The breach of this agreement, promise or contract is recognized by law and provision for remedies of such breach exists in law. The contract can be written in formal or informal words or it can be all oral depending on the nature and subject matter of the contract.

The terms of the contract - who, what, where, when, and how of the agreement - define the binding promises of each party to the contract.

Words, gestures, or actions can signal an offer to enter into a contract and an acceptance. If you are forced to make an offer ("your money or life") it is not a valid contract. Similarly, if you are tricked into accepting, it will not be considered acceptance of the terms offered. To have a binding obligation on both sides, both sides must approve and accept the terms and conditions of the offer. The offer remains open until: (1) acceptance, (2) rejection, (3) retract prior to acceptance, (4) counter, or (5) expiration by the terms.

In case of rejection of an offer a new contract can be put on the table (called a "counter-offer"). A counter-offer is a new set of terms and conditions given in response to the original offer. A counter offer may vary from the original offer by just one word, clause or multiple provisions of the complete contract.

You can take back or change the contract before the other party has agreed and undersigned the contract. This is considered a retraction. On the other hand, changing your mind after you have signed or agreed you will be deemed to be in a contract.

The three types of contract acceptance recognized by the court are:

  1. Express - a direct and absolute outward demonstration of agreement, such as, "I accept your offer."
  2. Implied - the acts of the parties show that the offer has been accepted, such as when both parties to a contract begin to perform the terms of the contract.
  3. Conditional - acceptance is conditional on the actions or occurence of something, such as, "I accept your offer so long as you finish painting my house in five days." By its terms, a conditional acceptance is a counter-offer.

The law clearly defines the key elements of a binding contract to be:

Competent Parties – For a valid contract, each party must have the capacity to enter into it. Capacity may be seen in terms of legal, mental, age, physical, etc. Agreeing to perform an illegal act is not consideration and the contract is void. A drugged or mentally impaired person does not hold the capacity to enter into any contract. Minors typically cannot enter into a legally binding contract without consent from a parent or guardian, unless it is for a necessity in life, such as food, clothing, or for student loan contracts.

Consideration – A contract is always based on mutual exchange. One must give something of value in exchange to the other party in agreement. The value or the compensation is mostly expressed in terms of money, however it can be anything of value such as tangible or intangible property or a service.

Mutual Understanding - Both the parties must be clear in all the clauses of the agreement and there should not be any element of doubt before signing the contract. Meeting of the minds sometimes can be expressed by words spoken or gestures made or can be inferred from the surrounding circumstances. There is no mutual assent: (1) one side is obviously joking or bragging, (2) there is no actual agreement (i.e., the farmer who is selling a gelding and the buyer thinks the horse is a brood mare), or (3) both sides have made a material mistake as to the terms or details of the contract.

If your contract involves, auto repairs, bounced checks, breaking a contract, canceling after signing, changing your mind, drug contract with undercover cop, federal contracts, insurance policies, pre-printed contracts, licensing deals, buy-sell agreements, business disputes, franchises agreements, or how to legally break a contract

Get assistance from a qualified business attorney who specializes in business contract law. A Contract lawyer can help people and businesses understand, negotiate, and prepare all types of business and consumer contracts.

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