Agreements are a common feature of our daily lives. Whether it`s a formal contract for purchasing goods or services or a simple handshake agreement between two individuals, agreements serve as the foundation for business and personal relationships. But what exactly is an agreement, and how is it classified? In this article, we’ll explore the meaning of agreements and their different types.
Agreement Defined
An agreement is a legally binding arrangement between two or more parties that outlines the terms and conditions of a particular transaction. At its core, a valid agreement requires an offer, acceptance, and consideration. An offer is the willingness to enter into a binding arrangement, acceptance is the other party`s response to the offer, and consideration refers to what the parties exchange as part of the agreement.
Types of Agreements
There are several types of agreements, each with its specific characteristics. The most common include:
1. Express Agreements
An express agreement is a written or spoken contract between two or more parties, explicitly stating the terms of their agreement. The contract can be formal or informal, and it must contain all of the essential elements of an agreement. Also, express agreements may be either unilateral or bilateral. A unilateral agreement is one where one party makes a promise in exchange for the performance of an act by the other party. A bilateral agreement is where each party promises to do something in exchange for something else.
2. Implied Agreements
An implied agreement is an unwritten contract that is based on the parties` actions or behavior. In an implied agreement, the parties` conduct implies their intention to enter into a binding agreement. These types of agreements are often formed in situations where one party provides goods or services, and the other party accepts them without objection.
3. Executed Agreements
An executed agreement is one where both parties have fulfilled their obligations, and the terms of the agreement have been completed. Once the agreement is executed, it becomes a binding contract. Executed agreements are common in real estate transactions, where the buyer pays the seller in full, and the seller transfers ownership to the buyer.
4. Executory Agreements
An executory agreement is one where one or both parties have not yet fulfilled their obligations. In this type of agreement, the contract is still pending, and the parties are waiting for something to happen before they can complete their obligations. For example, a lease agreement where a landlord agrees to rent a property to a tenant is an executory agreement until the tenant moves in and begins paying rent.
Conclusion
In summary, an agreement is a legally binding arrangement between two or more parties that outlines the terms and conditions of a particular transaction. The different types of agreements include express agreements, implied agreements, executed agreements, and executory agreements. Understanding the different types of agreements can help you navigate the complex world of business and personal transactions.