Contracts .. The Main Source of Obligations

Contracts .. The Main Source of Obligations

Contracts are considered to be the main source of obligations, and it is a true expression of its importance and functionality.

Legally, contracts in jurisprudence is the convergence of two or more wills to bring about certain legal effects, which may be the creation, transfer, modification or termination of obligations between the contracting parties.

The offerings & acceptance & the conditions stated in the contract are expressed by a free and impartial from any defects, coercion, error, fraud or exploitation.

In business, contracts are important because they outline expectations for both parties, protect both parties if those expectations aren’t met and lock in the price that will be paid for services.

Contracts are The Main Source of Obligations

It must that the reason for the contract is legally legitimate and compatible with public orders and public morals.

Invalidity is the penalty for the non-availability of the contract elements and their fulfillment of their conditions.

Therefore, it is necessary that the contract be written with the knowledge of a lawyer who is familiar with the pillars, terms and conditions of the contract.

It is important for any person to realize that once he signs any of the contracts such as a sale, lease or agency contract, he has become bound by the terms of this contract and the obligations contained within, so we always advise to pay attention to the negotiation stage before signing the contract to reach balanced obligations between the parties that guarantee.

Each party obtains its right, and so that neither party bears what it cannot bear.

Read also: The importance of Corporate Legal Management

Penalty clauses and compensation

The penalty clauses and the contractual compensation are among the important clauses in the contracts that must be taken care of to ensure the commitment of the contractors.

The contract is legally subject to many divisions, such as consensual and formal contracts, named and unnamed contracts, and others. The contract ends and expires when each party performs its obligations, by dissolution of the agreement of its parties, by the impossibility of its implementation and dissolution, or by termination by the virtue of a court ruling.

IN iLAW we present drafting contracts according to the United Arab Emirates Law with respect to each emirate.

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