Contract Law FAQs

Contract law is a branch of law that deals with agreements made between parties, establishing legally enforceable rights and obligations. In New Jersey, like in other jurisdictions, contract law is based on common law principles and may also be governed by statutory law.

When one party fails to fulfill their obligations under a contract, it is considered a breach of contract. If a breach occurs, the non-breaching party may have several legal remedies available to them. These remedies may include damages, specific performance, recession, reformation, and injunction.

In New Jersey, as in other jurisdictions, contracts are a common aspect of various business transactions. While it’s impossible to list every business that may require you to sign a contract, some common examples include real estate transactions, construction & home improvement, employment, professional services, telecommunications and utilities, fitness memberships, event planning & catering, subscription services, insurance, and loans & financing.

In New Jersey, as in other jurisdictions, a contract becomes official and enforceable when certain requirements are met. These requirements help ensure that both parties have a clear understanding of the terms and conditions of their agreement and have willingly entered into the contract. The essential elements of a valid and enforceable contract in New Jersey include:

Offer and acceptance: One party (the offeror) makes an offer to another party (the offeree) with specific terms. The offeree then accepts the offer, either explicitly (by expressing agreement) or implicitly (by performing the requested action). This creates a “meeting of the minds” between the parties.

Consideration: Each party must provide something of value in exchange for the other party’s promise or performance. Consideration can be a promise to perform a service, payment of money, or the exchange of goods.

Legality: The subject matter of the contract must be legal. Contracts that involve illegal activities or are against public policy are unenforceable.

Capacity: Both parties must have the legal capacity to enter into a contract. This means that they must be of legal age (usually 18 years old) and have the mental capacity to understand the terms of the agreement.

Mutual assent: Both parties must mutually agree to the terms of the contract, typically demonstrated through a meeting of the minds.

Definiteness: The terms of the contract must be clear and definite enough for the parties to understand their respective rights and obligations.

In addition to these general principles, certain types of contracts must meet additional requirements to be considered official and enforceable under New Jersey law:

Statute of Frauds: The Statute of Frauds requires that certain types of contracts be in writing and signed by the parties to be enforceable. Examples of contracts subject to the Statute of Frauds include contracts for the sale of real estate, contracts that cannot be performed within one year, and contracts to answer for the debt of another.

Special rules for specific types of contracts: Some contracts, such as those involving consumer transactions, may be subject to additional regulations and requirements under New Jersey law.

A contract is a legally binding agreement between two or more parties, where each party voluntarily agrees to specific terms and conditions.

A quasi-contract, also known as an implied-in-law contract, is not a true contract but a legal doctrine used by courts to prevent unjust enrichment. In cases where no express or implied contract exists between the parties, but one party receives a benefit at the expense of the other, a court may impose a quasi-contract to require the party to receive the benefit to compensate the other party. Quasi-contracts are created by law and not by the mutual agreement of the parties.