Managing Contract Risks Assignment Example | Topics and Well Written Essays - 2500 words

Managing Contract Risks - Assignment Example It is evidently clear from the discussion that contract is a legal agreement which binds parties with the intention of performing obligations in exchange for substantial consideration which is generally done formally in writing or by verbal agreements. It is either bilateral or unilateral. The mutual assent of parties, however, gives rise to obligations between parties involved and breaches thereof are remedied by law either by payment of damages, otherwise known as monetary compensation. As an economic activity, contracts also consider the sociological, anthropological and environmental terms of the agreement. Contract moreover is described as an offer accepted by another party based on the meeting of minds and some evidence showing their mutual assents to discourage ambiguities of terms. The consideration inherent in this agreement is of value in exchange for goods and services that will be rendered or delivered. Such consideration must be sufficient on its own. A contract can be i llustrated in purchase agreements where one party delivers a thing or good in exchange for payment. Other examples can be mirrored in specific performance of services in exchange for just compensation or payment. This is evident in a contract of employment or in case of constructing facilities as in the case of hiring engineers to perform the actual construction. Generally, contracts are made if parties have the legal capacity to make a contract; the purpose is legally warranted and forms are legal; parties have the intention to create legal relations, and mutual consent is adduced. Under the law, the contract can be vitiated when one of the parties of the contract made an irreparable mistake; is legally incapacitated; if contact is exacted out of duress and undue influence; if the contract is done in unconscionability and of misrepresentation; and, contract frustrate the purpose.