Tutorial 2- DR.

SURYANI

A contract is a legally binding agreement between two or more parties that results in legally
enforceable obligations.

The 5 components used to enforce the contract are:

1. Invitation: An invitation to treat is an invitation to an offer or proposal, not a binding

offer itself. This does not establish a legal obligation until an offer is made and
accepted. It is a sign that one party is open to negotiations or consideration of an offer.
2. Offer: The offer is an easily understood declaration of one party's interest to engage
in a contract with certain conditions. It must be given with the expectation that the
other party would be able to accept it, establishing the basis for a contract.
3. Acceptance: The offeree's unqualified agreement to the terms of the offer is known as
acceptance. It must be presented to the offeror in the way that the offer expressly
states or suggests. By bringing the parties to an agreement, acceptance completes the
deal and lends it legal force.
4. Capacity: For parties to engage in a contract, they must be able to legally do so. It
involves people who are of legal age, sane, and aware enough to fully understand the
terms of the agreement and the implications of signing it. A contract cannot be
enforced unless all parties have the legal competence to enter into it.
5. Certainty: A contract's regulations must be accurate, clear and neither unclear
nor ambiguous to be enforceable. Legally binding uncertainty can give reason for
disagreements and make enforcement challenging. Therefore, the legality of the
contract depends on making sure that its provisions are clear and straightforward.