When entering into a business deal, it is important to have a contract in place to ensure that both parties are on the same page and understand their obligations. However, a contract can be complex and contain various types of agreements that need to be clearly defined and understood. In this article, we will discuss the different kinds of agreements in a contract and why they are important.
1. Express Agreements
Express agreements are those that are clearly stated in the contract. They can be in the form of written or verbal agreements, but the written agreements are more common since they provide a clear record of what was agreed upon. It is essential to ensure that every express agreement is well-documented so that there is no confusion or dispute later on.
2. Implied Agreements
Implied agreements are those that are not explicitly stated in the contract but are inferred from the circumstances surrounding the agreement. For example, if a contract states that a seller will deliver goods to a buyer, it is implied that the goods will be delivered in a timely and satisfactory manner. These agreements need to be carefully considered and defined to avoid any ambiguity or misunderstanding.
3. Executed Agreements
An executed agreement is one that has been fully performed by both parties. This means that all obligations under the contract have been met, and the agreement is considered complete. It is important to keep records of all executed agreements to ensure that each party has fulfilled their obligations.
4. Executory Agreements
Executory agreements are those where one or both parties have not yet completed their obligations under the contract. For instance, if a contractor agrees to build a house for a client, but the construction is still ongoing, the contract is an executory agreement. It is vital to define the obligations of each party in the contract to avoid any confusion or disputes that may arise as the work progresses.
5. Valid Agreements
A valid agreement is one that meets all the requirements of a contract. These requirements include a mutual understanding of the terms and conditions, a clear offer, consideration, and acceptance. A valid agreement can be enforced by law, and any breach can result in legal action.
In conclusion, having a clear understanding of the different types of agreements in a contract is essential for any business deal. Each agreement needs to be carefully considered and defined to avoid any ambiguity or misunderstanding. By doing so, both parties can be confident that they have entered into an agreement that is legally binding and mutually beneficial.