2. Contracts

Question 1

What components make a valid contract? (4 points)

Answer 1

• Offer
• Acceptance
• Consideration (money from client & services from contractor)
  +
• Intention to create legal relations
• Lawful - (cannot be prohibited by law)
• Capacity - (minor or insane)

Question 2

What is the purpose of a contract? (3 points)

Answer 2

• Sets out obligations and liabilities of parties named in the contract
• Apportions risks to relevant parties
• Sets out administrative procedures