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I have a property purchase contract between myself and a salesperson. The contract is for me to buy a computer for the amount of one thousand two hundred dollars, payable in three equal monthly installments. The salesperson shall hand ownership of the computer to me after the first payment while retaining the warranty and receipt till I have completed paying for the computer. Once I have completed payment I shall have full ownership of the computer. The contract can however be terminated should I fail to make payments as agreed or if upon completion of payment the salesperson refuses to transfer to me the warranty and the receipts. We agreed that that if I failed to pay the sales person was entitled to repossess the computer. I would be entitled to a full refund if I completed the payments and the salesperson refused to transfer the ownership warranty to me.

Elements of an enforceable contract.

A contract is a legally binding agreement between two or more parties that forms binding duties or obligations that the parties are required to carry out. The parties are bound by the performance of the duties stated in the contract during its formation, failure to perform the duties or any changes made to the terms of the contract shall lead to a breach of the contract. The elements of an enforceable contract include:


This refers to an open invitation by one party to another with the intention of forming a contractual agreement (Sec 2-206, UCC). The offer may be written or an oral intention to form binding contractual terms between the parties. It can be in the form of a letter, a postcard, an advertisement, or an oral statement from one part to another with the specific details of the obligations that should be carried out. The language used in the offer should be clear ad devoid of ambiguities. The terms of the offer should be definitive as was decided in (Armstrong v. Rohm and Haas, 2004).

An offer can be terminated by either party through lapse of time if the terms of the offer included a time limit within which the offeree is meant to accept the offer. If such time expires the offer is considered terminated by the lapse of time. An offer can also be terminated by rejection or revocation.

In my example, the salesperson presented me with a written offer to sell me a computer. The offer included the computer specification, the cost of the computer and the period I was allowed to make payments. The offer also stated the situations that would lead to termination or cancellation of the contract and the consequences.

Acceptance of the offer.

This refers to when the offeree accepts the offer presented to them willingly and knowing that they are obligated to perform the obligations in the agreement. Acceptance of the offer must be communicated clearly to the offeror. A person cannot impose the obligations of an agreement on another based on silence. Acceptance must be accepted by the offeree or an agent elected by the offeree to represent him/her. The offeree cannot be bound by the terms of an agreement if they did not accept it themselves or their agent. Finally, the introduction of different terms of the agreement or a counteroffer does not mean acceptance of the offer.

In my example, I accepted the offer by signing the written offer. This was a clear indication that I had read the offer and was agreeing to the terms.


This is the value attached to the performance of the obligation stated in the agreement. The value can be money, an object or a service that the party agrees to give once the other party has performed the obligations in the agreement.

In my example, the cost of the computer was one thousand two hundred dollars that I agreed to pay in three equal monthly installments.

Capacity and Competence.

The parties intending to create legal contractual obligations should be of legal age and be competent to create or agree to such terms. Minors and persons who, at the time of forming the contract, were under the influence of substance abuse or were insane do not have the capacity or competence to create a contract.

In my example, the salesperson and I were, at the time we formed the contract, of legal age and competent to form a contractual agreement.

Breach of contract.

A violation of the terms of the contract leads to a breach. A breach may occur when a party fails to perform the obligations or repudiating their obligations under the contract. When a party refuses to perform their obligation that means that the contract has been breached and the other party may cease performance of their obligations. The aggrieved party may also demand compensation if they had performed their obligations before the breach. There are several remedies to breach of contract including specific performance and damages.

In my example, it was agreed that the contract would be breached if upon payment of the cost of the computer the salesperson refused to transfer to me the ownership titles or if I refused to complete the payments as agreed. In the event of breach because the salesperson refuses to transfer the ownership title to me, I am entitled to get a refund.

References list.

Armstrong v. Rohm and Haas Company, Inc. 349 F. Supp. 2d 71 (U.S. Dist. Ct. D. Mass. 2004)

Uniform Commercial Code.

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