Question

sam seller and bill buyer meet out in a field. neither sam nor bill has the commission approved contract form, so bill pulls out his handkerchief and writes down the address of the property, price, date of closing and collects $50 from bill. bill and sam sign the piece of paper. is this a valid contract?

Answer 1

In the given situation, the contract formed by Sam and Bill is not a valid contract.

What is a contract?

• A contract is an enforceable legal arrangement that establishes, details, and regulates the rights and duties of the parties.
• The transfer of commodities, services, money or a promise to transfer any of those at a later time are common components of contracts.
• The simplest definition of a contract is a commitment that is legally binding.
• The commitment could be to carry out or abstain from a certain action.
• A contract must be made by two or more parties who must agree to it, with one of them typically making an offer and the other accepting it.

Construction Contracts: 4 Types

1. Lump-Sum Agreements.
2. Cost-Plus-Fee Agreements.
3. Contracts with a Guaranteed Maximum Price.
4. Unit-Price Agreements.

Therefore, in the given situation, the contract formed by Sam and Bill is not a valid contract.

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