Free US Law Dictionary

Contract Law

A contract is a legally binding exchange of promises or agreement between parties that the law will enforce. Contract law is based on the Latin phrase pacta sunt servanda (pacts must be kept).[1] Breach of contract is recognised by the law and remedies can be provided. Almost everyone makes contracts every day. Sometimes written contracts are required, such as when buying a house.[2] However, most contracts can be and are made orally, like buying a law textbook, or a coffee at a shop. Contract law can be classified, as is habitual in civil law systems, as part of a general law of obligations (along with tort, unjust enrichment or restitution).

According to legal scholar Sir John William Salmond, a contract is "an agreement creating and defining the obligations between two or more parties".