FREQUENTLY ASKED QUESTIONS ABOUT CONTRACTS
Disclaimer: The information contained on this page is not legal advice. The information provided on this website is for general informational purposes and is not necessarily updated to account for changes in the law. You should consult with an attorney for legal advice regarding your individual circumstances.
Are contracts required to be in writing to be enforceable?
In some cases, a verbal agreement may constitute a binding contract, but in other situations an agreement must be reduced to writing to become a binding contract. "Statutes of frauds" identify those types of contracts which must be in writing. For example, in Wisconsin contracts for the sale of real estate, leases for real property with a term of more than one year, real estate commission agreements, certain contracts that by their terms are not to be performed within one year, and contracts to pay another person’s debts, must generally be in writing. However, there are exceptions to the statute of frauds rules which may apply. The statute of frauds rules vary from state to state. Equitable remedies may in some cases be available to enforce an agreement that fails to comply with the applicable statute of frauds. Even in situations where a verbal agreement could be enforceable, the best practice is, in most cases, to reduce the agreement to writing to confirm the parties’ understanding and acceptance of the terms.
What are the minimum requirements to form a contract?
Every contract requires three basic elements: an offer, acceptance of the offer, and consideration. "Consideration" can include the payment of money, providing goods or services, or the mutual exchange of promises.
Are some contracts unenforceable or void?
Contracts in some cases may be found to be unenforceable or voidable due to misrepresentation, illegality, unconscionability, duress, undue influence, or incapacity of one of the parties.
When does a breach of contract occur?
A breach of contract generally occurs when a party fails to perform its obligations under the contract and such failure to perform is not excused by the non-breaching party. Examples of a breach of contract include a failure to pay for goods or services, providing defective merchandise, or failing to deliver goods or services under the time frame specified in the contract. A breach may also occur if a party violates a covenant or other term in the contract.
If the other party breaches our contract, can I sue or take other legal action?
Your contract should be carefully analyzed to determine how to proceed. Some contracts require the non-breaching party to give notice of the breach and give the other party an opportunity to "cure" the breach before you can file suit. In some cases, such as with construction contracts, there may be statutory right to cure notice requirements. Some contracts obligate the parties to engage in a mediation prior to filing suit, in which the parties are required to meet with an impartial third party and attempt to negotiate a settlement of their dispute. Some contracts also include "forum selection" provisions which specify the particular jurisdiction or court in which a lawsuit must be brought.
I was mistaken about some of the contract terms when I entered into the contract. Can I get out of it?
Under certain circumstances, a mistake made by the parties when entering into a contract may constitute a basis for reforming or terminating a contract. The likelihood that a court would reform or terminate a contract is increased if the mistake was "mutual," meaning that both parties made the same mistake. The rules governing relief available in the event of a mistake are complex, and you should consult with an attorney if you have questions regarding the enforceability of a contract where a "mistake" is involved.
I don’t want to end up in court. Can a contract require disputes to be arbitrated instead?
Some contracts contain provisions requiring that disputes over the contract must be arbitrated instead of being brought in court. Arbitration is a process by which an individual arbitrator or a panel of arbitrators (usually lawyers or other professionals with experience in the subject matter of the contract) presides over the case and hears evidence from both sides. Particularly with larger and more complex cases, arbitration can be quicker and less expensive than a lawsuit. Mandatory arbitration provisions are common in construction contracts and contracts.
What kind of damages can I recover from the other party if they breach the contract?
Damages that may be recovered for a breach of contract will vary, depending on the terms of the contract and the nature of the breach. Parties are usually entitled to compensatory damages intended to place them in the same position as if no breach had occurred. Contracts may contain limitations on the type or amount of damages that may be recovered in the event of a breach, or specify a particular amount of damages ("liquidated damages") that will be awarded in the event of a breach.
Disclaimer: The information contained on this page is not legal advice. The information provided on this website is for general informational purposes and is not necessarily updated to account for changes in the law. You should consult with an attorney for legal advice regarding your individual circumstances.
Are contracts required to be in writing to be enforceable?
In some cases, a verbal agreement may constitute a binding contract, but in other situations an agreement must be reduced to writing to become a binding contract. "Statutes of frauds" identify those types of contracts which must be in writing. For example, in Wisconsin contracts for the sale of real estate, leases for real property with a term of more than one year, real estate commission agreements, certain contracts that by their terms are not to be performed within one year, and contracts to pay another person’s debts, must generally be in writing. However, there are exceptions to the statute of frauds rules which may apply. The statute of frauds rules vary from state to state. Equitable remedies may in some cases be available to enforce an agreement that fails to comply with the applicable statute of frauds. Even in situations where a verbal agreement could be enforceable, the best practice is, in most cases, to reduce the agreement to writing to confirm the parties’ understanding and acceptance of the terms.
What are the minimum requirements to form a contract?
Every contract requires three basic elements: an offer, acceptance of the offer, and consideration. "Consideration" can include the payment of money, providing goods or services, or the mutual exchange of promises.
Are some contracts unenforceable or void?
Contracts in some cases may be found to be unenforceable or voidable due to misrepresentation, illegality, unconscionability, duress, undue influence, or incapacity of one of the parties.
When does a breach of contract occur?
A breach of contract generally occurs when a party fails to perform its obligations under the contract and such failure to perform is not excused by the non-breaching party. Examples of a breach of contract include a failure to pay for goods or services, providing defective merchandise, or failing to deliver goods or services under the time frame specified in the contract. A breach may also occur if a party violates a covenant or other term in the contract.
If the other party breaches our contract, can I sue or take other legal action?
Your contract should be carefully analyzed to determine how to proceed. Some contracts require the non-breaching party to give notice of the breach and give the other party an opportunity to "cure" the breach before you can file suit. In some cases, such as with construction contracts, there may be statutory right to cure notice requirements. Some contracts obligate the parties to engage in a mediation prior to filing suit, in which the parties are required to meet with an impartial third party and attempt to negotiate a settlement of their dispute. Some contracts also include "forum selection" provisions which specify the particular jurisdiction or court in which a lawsuit must be brought.
I was mistaken about some of the contract terms when I entered into the contract. Can I get out of it?
Under certain circumstances, a mistake made by the parties when entering into a contract may constitute a basis for reforming or terminating a contract. The likelihood that a court would reform or terminate a contract is increased if the mistake was "mutual," meaning that both parties made the same mistake. The rules governing relief available in the event of a mistake are complex, and you should consult with an attorney if you have questions regarding the enforceability of a contract where a "mistake" is involved.
I don’t want to end up in court. Can a contract require disputes to be arbitrated instead?
Some contracts contain provisions requiring that disputes over the contract must be arbitrated instead of being brought in court. Arbitration is a process by which an individual arbitrator or a panel of arbitrators (usually lawyers or other professionals with experience in the subject matter of the contract) presides over the case and hears evidence from both sides. Particularly with larger and more complex cases, arbitration can be quicker and less expensive than a lawsuit. Mandatory arbitration provisions are common in construction contracts and contracts.
What kind of damages can I recover from the other party if they breach the contract?
Damages that may be recovered for a breach of contract will vary, depending on the terms of the contract and the nature of the breach. Parties are usually entitled to compensatory damages intended to place them in the same position as if no breach had occurred. Contracts may contain limitations on the type or amount of damages that may be recovered in the event of a breach, or specify a particular amount of damages ("liquidated damages") that will be awarded in the event of a breach.