Understanding Commercial Law
Marko Vujosevic
Understanding Commercial Law
Commercial law focuses on the laws that support companies and businesses as they produce and transact in products and services. This area of the law is quite broad and covers the rights and obligations of parties in different types of transactions. At the heart of many of these exchanges is a contract (or agreement) that defines each party’s expectations.
Contract Elements
It is difficult for parties to transact without a defined agreement. In the business world, a lack of a contract means neither party has an assurance that the other will honor their obligation. For this purpose, a contract has the following elements: •
Offer: A party looking to enter into an agreement must make an offer that defines the terms, with the intention of entering into a legally binding agreement.
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Acceptance: The party to whom an offer is made has the opportunity to accept and convey this to the first party.
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Consideration: This is regarded as the promise to do something that is included in the contract. For example, one party can promise to deliver a certain quantity of product, while the other promises to pay a certain amount when the delivery happens.
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