As a business owner, you probably enter into contractual relationships every day. Many of you deal with written contracts on a fairly regular basis. However, do you understand the basic concepts of contract law and what makes a legally binding contract? Do you know what to look for when reviewing contracts prepared by the other party, or your own attorney that make it a legally binding contract?
Under Wisconsin contract law, legally binding contracts, whether oral or written, require three basic components: offer, acceptance, and consideration. An “offer” requires that one party offers to provide something of value to another party, which is then “accepted” by that other party. “Consideration” is what the two parties are obligated to exchange with each other as part of the contract. Consideration must be something of value, and the consideration must be mutual, i.e. both sides must provide something of value under the contract. … Read More