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171 
UNIT 5. CONTRACTS
 
 
1. Ответьте на вопросы. 
 
1. 
What is a contract? 
2. 
Have you ever entered into a contract? 
3. 
Decide on items that you think should be included in a contract. Don`t worry 
about the exact terminology yet. 
4. 
Do you think contracts should be written in plain language so that everybody 
could get the point or should be comprehended only by legal professionals? 
Contract is a legally enforceable agreement between two (or more) parties. 
How is a Contract Formed? 
Before a contract can be formed, there must be both an offer and an acceptance of that offer. 
Sounds simple? It`s not; lawyers everywhere have earned millions of dollars in fees arguing just 
whether or not a valid contract existed. 
In common law, contracts are formed in the following manner. 
1. an offer in made by a person or corporation normally referred to as an offeror; 
2. the offer is then accepted (acceptance) by a person or corporation normally referred to as an 
offeree. 
Let’s reduce what we’ve learned about contracts to a formula: 
Offer + acceptance = bona fide (valid) contract 
If the parties are (a) competent, (b) mutually agree and obligate themselves regarding a specific 
subject, and (c) there is legal consideration 
The contract is binding (legally enforceable) if only there are these four elements: 
1. competent parties; 
2. legal subject matter; 
3. legal consideration; 
4. mutuality of agreement; and 
5. mutuality of obligation. 
The absence of any of these elements may render (make) a contract unenforced 

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