Contract - American business
A contract is an agreement between two or more parties creating obligations (promises) that are recognized and enforceable by law. For example, the author of this book and its publisher have entered into a lengthy written contract detailing each others’ obligations. Contracts may also be reached orally or electronically, but the Statute of Frauds incorporated as part of the Uniform Commercial Code and its successor statutes require certain contracts relating to realty, debts, marriage, sales, and those that take more than a year to perform to be in writing. Enforcement of contractual obligations is normally accomplished by means of court orders and remedies, although the parties to contracts may generally agree to submit their disputes to mediation or ARBITRATION
or to pay a reasonable sum (“liquidated damages”) in the event of a breach of contract. There are many different types of contracts: sales, LICENSING
, cost-plus, requirements, distribution, installment, procurement, etc. Some contracts, especially consumer contracts, are standardized on printed forms. Contracts and contract terms can be implied from the circumstances surrounding the parties’ actions and have traditionally been governed by COMMON LAW
doctrines regarding their formation, terms, and remedies. Most U.S. commercial contracts are governed by the UNIFORM COMMERCIAL CODE
(UCC), a widely adopted statutory body of law. International commercial contracts may be governed by the Convention on the International Sale of Goods (CISG), to which the United States is a party.