Contracts are meant to protect the interests of both parties and are common in real estate, between organizations and independent contractors, and between vendors and individuals. Typically, contracts are legally binding documents that spell out the agreements between both parties to perform specific actions. However, there are certain circumstances that allow both parties to dissolve contracts amicably or when those contracts can be considered null and void. In both cases, the dissolution or voiding of a contract relinquishes either party from performing its stipulated actions.
What Makes a Contract a Contract?
If someone has ever bought or sold a house, that person has probably signed several simultaneous contracts. That person may have entered into an agreement with a real estate agent and broker agency, as well as a contract with the buyer or seller of the home. One of the main components of a valid contract is an offer and an acceptance. For questions about the legal aspects of contracts, see an edinburg attorney.
Using the real estate example, when a seller accepts an offer that a potential buyer has made for a home, both the buyer and the seller then enter into a contract to sell or purchase real estate. However, the terms of the offer and its stipulations are usually spelled out within the contract and both parties must agree to those terms. Until there is a mutual agreement, technically there is not a contract. If the seller did not agree to all of the terms of the buyer’s offer, the seller could make a counteroffer, ignore, or reject the offer, which would mean that a contract is not yet in place.
Other Main Components of a Contract
Besides a mutual agreement on the terms of the contract, the content of the agreement needs to concern a legal matter and both parties must be legally capable of signing the contract. In most cases, the contract or agreement should also be in writing and signed. Some agreements or contracts also require the signature of a notary who verifies the identity of the person or persons that sign the contract. There should also be a price, value, or benefit exchanged between the parties, and this is usually outlined in the contract’s language.
Reasons a Contract Can Be Null and Void
Several possibilities, based on the main elements, exist for making a contract null and void. For instance, in many situations, if a minor signs an agreement, the contact can be considered null and void since one of the parties was not of legal age to consent. Other examples include forcing a person to sign a contract and when one of the parties signs an agreement while under the influence of heavy medication, illegal drugs, or alcohol. When facts and information are misrepresented within the contract, this also usually gives one or both of the parties grounds to declare the contract null and void.
Signing a contract may seem commonplace, given that most of us will eventually purchase property or enter into a professional contract role. However, many contracts have built-in clauses that give the parties reasons to back out of or release the other from the contract’s obligations. This is different from a null and void contract, where the basic elements of a legally binding agreement were not in place at the time the document was signed.