Essential Elements of a Valid Contract

For an agreement to become a legally valid contract, it must satisfy all of the following elements. Missing even one can make the agreement void, voidable, or unenforceable.

1. Offer and Acceptance — there must be a lawful offer by one party and a lawful acceptance of that offer by the other.
2. Intention to create legal relationship — the parties must intend that their agreement will have legal consequences if broken (this is why purely social/domestic agreements are excluded).
3. Lawful consideration — each party must give and receive something of value in return (Section 2(d)); a bare promise, given for nothing, is generally not enforceable.
4. Capacity of parties — the parties must be legally competent to contract (of the age of majority, of sound mind, and not disqualified by any law).
5. Free consent — the parties must agree upon the same thing in the same sense, and that agreement must not be caused by coercion, undue influence, fraud, misrepresentation, or mistake.
6. Lawful object — the purpose of the agreement must not be illegal, immoral, or opposed to public policy.
7. Agreement not expressly declared void — the agreement must not fall into a category the Act itself declares void, e.g. an agreement in restraint of trade or marriage.
8. Certainty of meaning — the terms of the agreement must be clear and certain, not vague, so that they can actually be enforced. …