Most if not all managers will likely find themselves working with contracts on a consistent basis. Oftentimes a manager will be presented with contracts that they have to sign or review for the purpose of employing an applicant. Contracts are also used when in the procurement merchandises for the business or other purposes. Whatever is the case, managers and others have to comprehend the process of contract law.
For the purpose of this paper this author will discuss the process or mechanics of contract law. Moreover, in this paper this author used the scenario presented as a foundation for the discussion. The scenario discusses a head chef that was hired by a hotel under a two-year employment contract. Two years later the chef was offered a job by a second hotel. The issue for the chef was a section of the current contract he signed with the “Fabulous Hotel” that stated: “The below-signed agrees not to work as a chef for another hotel in the same metropolitan area for a period of two years after leaving our employ.” Using this scenario this author will examine and explain the “five elements of a contract” that are a necessity for the contract to be enforceable.
“The five elements of a contract”
A contract between two parties must have certain element to be considered tangible or authentic. The element of the contracts will enclose guarantees that are enforceable and thus legal (Seaquist & Coulter, 2012). For a contract to be legal the promises include in the contract has to meet specific benchmarks. A valid contract simply means that it can enforce in the courts (Seaquist & Coulter, 2012). According to Seaquist & Coulter (2012) “a valid contract to be formed that is enforceable by a court, each of the following criteria must be present, the element is the offer, acceptance, consideration, capacity, and legality.”
Offer - the offer consist of two factions in a contract negotiation which is the one presenting the offer also known as the “offeror”, and the “offeree” which is the individual who can accept or decline the offer (Seaquist & Coulter, 2012).
Acceptance- is the element of the contract that normally occurs after a valid offer. This part of the contract is where the consent to the conditions of the offer and contract development has initiated (Seaquist & Coulter, 2012).
Consideration-is the element of the contract where a differentiation is made between a gift and contract. Consideration entails the “promisor” gets the “promisee” to agree to perform an action that they were not until that time legally obliged to do (Seaquist & Coulter, 2012).
Capacity- is the element where mental state of the participants to the contract has to be considered. Both factions in the contract negotiation must show that they have the capacity to understand the consequences of going into a contract (Seaquist & Coulter, 2012).
Legality- is the last element of a contract which makes sure the stipulation of the agreement is official and binding...