MORE IN THIS SECTION

User Rating: 4 / 5

Star ActiveStar ActiveStar ActiveStar ActiveStar Inactive
 

Q: What is a contract?

A: A contract is “an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law,” (Black’s Law Dictionary, 7th Edition). This means the agreement creates terms, conditions, and obligations between each person to perform and abide by as long as those terms and conditions are legal under state and/or federal law.

 

Q: Who can sign a contract?

A: Any person 18 years old or older can legally sign a contract. Remember that signing a contract, whether it is for a car loan, apartment, employment, or any other legal document, places you legally responsible for everything within the contract. Therefore, make sure you carefully read and agree to all the terms and conditions in the contract before signing. 

 

Q: What are important things to consider before signing?

ABefore signing a contract:

  • Read the entire document and make sure you understand and agree to each section
  • If you do not understand a section, ask questions
  • If you are in disagreement over a certain section, talk with the other party/person about changing or eliminating that section
  • Never leave blank spaces in a contract, either fill them in or cross them off
  • Always make sure you have a copy of the contract that is signed by both parties and keep it in a safe and secure place

 

Q: What if a party fails to perform their part of a contract?

AIf you or the other person fails to perform their duties and obligations stated in the contract, there are a few things that could happen.

  • The parties can agree to resolve the “breach” by changing the original contract in a way that allows the failing party to better perform his/her duties under the contract (known as a modification). 
  • If a change to the original agreement is not an option, the party that is failing, can be sued in court for failing to perform his/her duties and a judge will decide what the consequences will be.  In most cases, the failing party will owe the other party money (known as an award for monetary damages).

 

Q: Do all contracts have to be in writing?

ANo. In Arizona, verbal contracts may be legal and binding. Although this is true, verbal contracts may be difficult to prove if a breach occurs. In order to have an official binding contract, under the statutes of fraud (A.R.S. §44-101), the contract must be in writing and signed by all parties who are held to the contract.

 

Laws may have changed since the last time this article was updated.  The current and most up-to-date laws can be accessed here.