Text 1 Must Contract Be in Any Special Form?

Contracts may be oral or written. They may even be implied from conduct. Most contracts are oral. Many contracts are made by telephone. Some contracts are made and carried out in a single face-to-face conversation. For example, in the sale of goods, payment by buyer and delivery by seller often occur when the agreement is made. A person may take a job, rent an apartment, and enter many other business agreements without the formality of a written contract. Sometimes conduct alone is sufficient. For example, a person may stop a bus, board it, deposit the proper coins, and later get off. No words are spoken or written by either passenger or driver, yet there is a valid contract.

There are, however, certain important kinds of contracts which will not be enforced in court unless some properly signed writing proves their existence. For example, contracts to transfer an interest in real property (land or objects permanently attached to the land) must be in writing.

Even when a written contract is not required by law, it is often wise to put the agreement in writing and have a signed copy for each party. This is particularly true if the agreement is complex and contains many details, which could lead to later misunderstandings. It is also important when large sums of money or long periods of time are involved. In such cases, it is advantageous for both parties to express their intentions with reasonable precision n written form. In this way, the agreement can be easily referred to or readily proved if necessary. The chance of later confusion or disagreement is greatly reduced. Neither party can effectively deny having agreed to particular terms. Also, the process of putting ideas into writing encourages the parties to anticipate and provide for problems that could arise later. It is usually easier to settle such matters before either party signs and while both parties are inclined to compromise in order to conclude the agreement. Later, each party tends to demand strict performance of the terms. To prepare or review important contracts one may seek the aid of a lawyer.

Text 2 Classification of Contracts

Contracts can be classified as either unilateral or bilateral, according to whether one or both parties make a promise. Contracts can be also classified according to enforceability as valid, voidable and void or unenforceable. The following classifications are also important: