1.

Contract
 A meeting of minds between two parties whereby one binds himself, with respect to the other, to give
something or to render some service, or to refrain from doing some particular thing.
2. Valid Contract
 Those that meet all the legal requirements and limitations for the type of agreement involved and are,
therefore, legally binding and enforceable.
3. Innominate Contract
 Has no specific name or designation under the law.
4. Kinds of Innominate Contract
 Do Ut Facias (I give that you may do)
 Facto Ut Des (I do that you may give)
 Facto Ut Facias (I do that you may do)
5. Cases When Strangers or 3rd Persons Affected by a Contract
 In contracts containing a stipulation in favor of a third person (stipulation pour autrui)
 In contracts creating real rights.
 In contracts entered into to defraud creditors.
 In contracts which have been violated at the inducement of a third person.
6. Stipulation Pour Autrui
 A stipulation in a contract clearly and deliberately conferring a favor upon a third person who has a right
to demand its fulfillment provided he communicates his acceptance to the obligor before its revocation
by the oblige or the original parties.
7. Real Rights
 It includes ownership, use, pledge, usufruct, mortgage, and predial servitude.
8. Usufruct
 It refers to the right of one individual to use and enjoy the property of another, provided its substance is
neither impaired nor altered.
9. Predial Servitude
 It is a charge laid on an estate for the use and utility of another estate belonging to another owner.
10. Classification of Contracts According to Perfection
 Consensual contract: perfected by mere consent.
 Real contract: perfected by the delivery of the thing subject matter of the contract.
 Solemn contract: requires compliance with certain formalities prescribed by law, for example, donation
of property which must be in a public instrument.
11. Unauthorized Contracts
 A contract entered into, in the name of another by one who has no authority is unenforceable.
12. Requisites of Contracts
 Consent of the contracting parties
 Object certain which is the subject matter of the contract.
 Cause of the obligation which is established.
13. Consent
 The meeting of minds or mutual assent between the parties on the subject matter and the cause which
are to constitute the contract even if neither has been delivered.
14. Offer
 A proposal made by one party (offerer) to another (offeree), indicating a willingness to enter into a
contract.
15. Acceptance
  The manifestation by the offeree of his assent to all the terms of the offer.
16. Option Contract
 Giving a person for a consideration a certain period within which to accept the offer of the offerer.
17. Option Period
 The period given within which the offeree must accept the offer.
18. Option Money
 The money paid or promised to be paid in consideration for the option.