What HAS to Be in My Contract?
Contracts do not need to contain much “magic language” to be valid, but they do need to name the parties, be signed by both parties, and the price needs to be stated or determinable. There needs to be an offer and acceptance of that offer.
In addition, both sides need to give “consideration,” which is the exchange of something of value. Usually, one party promises to provide a good or service, and the other side promises to pay for it. Sometimes one party offers not to do something (called forbearance), and the other party promises to pay, such as when one party agrees to settle a claim or not to compete.
If you want to read a deeper dive on ensuring your contract has an offer, acceptance, consent and definable terms, click here.
If certain terms are missing, often the Uniform Commercial Code can fill the gaps, such as delivery or shipping terms, risk of loss, and warranty.
Contracts, however, are one of the most important devices to help a business minimize its risks. The indemnity, limitation of liability, and warranty provisions address what happens when things go wrong, and who will pay for them.