Contracts Legal Analysis Example

Contracts Legal Analysis Example

Today, A says to B, A will sell my 2008 fully loaded red convertible Mustang to B for $15,000 if B will bring that sum of cash to A’s home this coming Friday. B says gosh, yes. I absolutely will buy your Mustang this coming Friday for $15,000 cash. I have loved that car since you bought it new. Yes, yes, yes!

Is there a contract? Use legal analysis to discuss.

Issue: Is B’s statement a valid acceptance of A’s offer to sell the Mustang?

Rule: Contracts have six elements, and to be enforceable all six elements must be met. An offer is a statement showing an intention to enter into a contract. The terms must be specific with respect to price, subject matter, parties and time for performance. An acceptance must communicate an intention to be bound by the exact terms of the offer; a mutual agreement must be formed. Consideration is the subject matter of the contract and must have legal value. The subject of the contract must be legal, that is, it cannot be illegal. Both parties to a contract must have the capacity to enter into a binding agreement; they must understand what they are doing. Contractual intent or a meeting of the minds is also required, and nothing can interfere with a party’s intent or desire to enter into the agreement.

Analysis: A’s statement to B has the elements of an offer since it is communicated to B, expresses A’s intention to sell the car, and has specific terms. A states the contract price of $15,000, the subject matter is adequately described as the 2008 fully loaded red convertible Mustang, both parties (A and B) are specified, and the time B must perform is specified. These terms would be clear if a judge had to enforce them.

The consideration or subject matter has been described; A will part with A’s car and B will part with his $15,000. Both parties will receive a