What Makes a Contract Legally Binding?

Contracts are the foundation of many business dealings and personal agreements. Whether you’re buying a car, hiring a contractor, or starting a partnership, understanding the basics of contract law is crucial. In this blog post, we’ll cover the fundamental elements that make a contract enforceable under Washington State law, as well as common issues to be aware of.

Key Elements of a Valid Contract

Offer and Acceptance:

Every contract starts with one party making an offer to another. The offer must be clear, definite, and communicated to the other party.


Consideration refers to something of value exchanged between the parties, such as money, goods, or services. It distinguishes a contract from a gift or a promise without anything given in return.

Both parties must intend for their agreement to be legally binding. Social agreements (like lending a book) usually lack this intention, while business agreements presume it.


Each party must have the legal capacity to enter into the contract. This means they must be of legal age, mentally sound, and not under the influence of drugs or alcohol.


The contract’s purpose must be legal. Agreements to do something illegal or against public policy are not enforceable.

Certainty and Completeness:

The terms of the contract must be clear enough for all parties to understand their rights and obligations. Vague or ambiguous terms can lead to disputes.

Common Issues in Contract Disputes

Despite meeting the requirements above, disputes can arise due to several factors:

  • Ambiguity: Unclear language or ambiguous terms can lead to misunderstandings about each party’s responsibilities.
  • Breach of Contract: One party fails to fulfill their obligations as outlined in the contract, whether through non-performance or improper performance.
  • Misrepresentation: One party makes a false statement that influences the other’s decision to enter into the contract.
  • Duress or Undue Influence: A party is forced or pressured into entering the contract against their will.
  • Mistake: Mutual misunderstanding about a fundamental aspect of the contract can invalidate it.
  • Impossibility: Unexpected events make it impossible for one party to fulfill their obligations.

Tips for Creating a Strong Contract

To ensure your contracts are clear, enforceable, and protect your interests:

  • Use Clear Language: Define all terms and conditions clearly, avoiding jargon or vague language.
  • Get It in Writing: While oral contracts can be valid, written contracts provide clear evidence of the agreement’s terms.
  • Consult Legal Counsel: A lawyer can help draft or review contracts to ensure compliance with state laws and protect your interests.
  • Understand Before Signing: Read and understand the entire contract before signing, seeking clarification on any unclear terms.
  • Include Dispute Resolution: Consider including provisions for resolving disputes through mediation or arbitration.

Understanding the basics of contract law empowers you to navigate agreements confidently and protect your rights. By ensuring your contracts meet legal requirements and addressing potential issues early on, you can minimize the risk of disputes and ensure agreements are enforceable. For personalized legal advice or assistance with contracts, contact the Law Office of Erin Bradley McAleer at (360) 334-6277.