Contract Law

Contract Law

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Contract Law

A contract is a legal agreement involving two or more private parties that creates statutory requirements for both parties. Contracts are legal obligations that contain pledges. While general contract law is consistent across the nation, some individual court interpretations of a particular feature of the contract may differ among the states. Contract law is controlled primarily by state common law. The law gives the aggrieved person relief if a commitment is broken. General damages, specific performance, reliance damages, and consequential damages are all possible compensation for legal agreement breaches.

Elements of a Valid Contract

For a contract to be considered valid it has to meet four specific requirements. These requirements include offer, acceptance, consideration and legality. There would not be a contract if one of the parties did not make an offer. An offer is therefore a declaration of intent to enter into a legally binding agreement with specific conditions (Raskin, 2016). An offer should be clear, precise and easy to identify as an offer. However if a shopkeeper displays an item on a window display, it is not an offer but an invitation to treat. A counter offer goes against the original offer and therefore reliefs the offeror of his or her legal obligation. After an offer is made, the other party is expected to accept the offer (Raskin, 2016). There has to be a meeting between the two parties so as to agree on which offer to be acceptance. The acceptance must also be very clear. The act of exchanging something of value to each party’s prejudice is known as consideration. Both parties have to provide a consideration for a contract to be valid.

The contract must also be legal and the parties involved must be willing to be legally bound. However there are various limitations. Mental disease or cognitive impairment may limit one’s ability to enter into a contract. Dementia and Alzheimer’s issues might make it difficult to determine a person’s capacity to sign a contract (Raskin, 2016). Contracts signed by persons under the age of eighteen are permissible, although they may be revoked at the minor’s request. The contracts must also be in a written format. The common law and the Uniform Commercial Code (UCC) both control contract law (Kettering, 2021). Contractual agreements involving real property, services, insurance, intangible assets, and employment are governed by common law. Contractual agreements involving products and material possessions, such buying a car, are governed by UCC.

Dutta V. Amica Mutual Insurance Company

The case was conducted by the court of Uttah district in Texas state. The plantiffs were Nader Dutta and Chizuko Dutta while the defendants were Amica Mutual Insurance Company. The Dutta family suffered as a result of being hit by an automobile. The Duttas attempted to seek compensation from their own insurance carrier, Amica, in accordance with the underinsured motorist clause of their insurance contract after receiving the driver’s insurance’s policy limits. Amica turned down coverage. The Duttas filed this lawsuit, arguing that Amica’s denial of coverage violated both contractual and extra-contractual obligations to the plaintiffs. Both parties agreed that Texas law applied to the contractual claims made by the Duttas. Amica requested summary judgment on all claims in a Motion for Summary Judgment. The Texas Supreme Court decided Allstate v. Irwin in 2021, after the deadline to amend the pleadings in this case had passed. Two crucial Texas legal principles were clarified by Irwin II and cases that followed it.

The court ordered that within 28 days of the entry of the judgment on April 2022, the Duttas were given permission to alter their complaint; failure to do so will result in a dismissal without cause. The parties were required to meet and consult, and within 45 days of the entry of this order, file a status report notifying the court whether any more briefing will be required on the Motion for Summary Judgment, and if so, the date for such briefing. The July 19, 2022 trial date was cancelled. If the parties elect to file an updated Complaint and request further briefing on the Motion, a new scheduling order shall be issued. As much as the court has not yet found both parties at fault due to accusations of breach of contract, the parties should try to settle their disagreement out of court. It will give the court an easier time and none of the parties will face significant losses. However, the insurance company should cover the costs for the accident.


Kettering, K. C. (2021). Coordination of the Uniform Commercial Code and Common Law. Available at SSRN 3964328.Raskin, M. (2016). The law and legality of smart contracts. Geo. L. Tech. Rev., 1, 305.