Contracts are an essential part of business transactions in Maryland, but they are a particularly complex part of the law. Because contracts can take a variety of forms, like written or oral, and include clauses that have serious ramifications, it is critical that you understand what constitutes a legally binding contract in Maryland.
What Is a Contract?
A contract is a legally binding agreement between two or more parties. Contracts can be oral or written, but certain contracts must be written to be legally binding. All contracts must be entered into voluntarily by people who are deemed competent to do so.
What Makes a Legally Binding Contract in Maryland?
There are five critical parts of a contract to make it a legally binding contract in Maryland:
- Offer: The contract must include a proposal to pay something, do something or have some exchange of things of value.
- Competent Parties: Minors, those who are deemed to be mentally incapacitated and others who are not competent to enter into a contract cannot do so.
- Acceptance: All parties must agree upon the contents of a contract.
- Consideration: All parties must get something through the contract, even if the “something” in question is relatively small.
- Performance: There is something that must be fulfilled through the contract. In some cases, once that obligation is met, the contract is automatically terminated. In others, it could be ongoing until both parties mutually agree to terminate it.
What Can Complicate Contracts?
There are a variety of factors that can invalidate a contract during the process or after it is signed:
- Fraud: If one party intentionally misrepresented something or lied when creating the contract, the contract could be invalidated.
- Breach of Contract: This can happen if one of the parties does not fulfill their obligation for part of the contract. This could be outright refusing to perform, failure to perform or making it impossible for the other party to fulfill their obligation.
- Cooling Off Period: Every legally binding contract in Maryland does not necessarily come with a three-day cooling off period, although there is one for door-to-door sales and other specific transactions (health clubs, weight loss centers, etc.).
Contact Mobley & Brown, LLP for Help with Contract Law in Maryland
If you are searching for the right attorney in Maryland and unsure where to turn, contact Mobley and Brown, LLP today. Our experienced legal team will work with you to meet your needs. Call us now at (410) 385-0398.