Recently, I was contacted by two old friends regarding an unpleasant incident that they had experienced. According to Jim and Laura Buyer, they visited a local dealership with the hopes of attaining a new car. Supposedly, the car that they have currently is aging and is having a lot of mechanical issues. Their stated intentions were to purchase a new car together so that they could use it to go back and forth to work and school. Prior to entering the dealership, they both decided that they could only afford approximately $400.00 a month in car payments. While at the dealership, they meet Stan Salesman. During that time, they viewed several vehicles while test driving the ones that they like.  After some time there, they found a blue 4-door sedan which they both liked. Not wanting to act abruptly, they put $100.00 deposit towards holding the car for a day. They stated that Salesman did not give them a receipt, but he guaranteed that the $100 was refundable. The next day, the couple decided that they didn’t want the vehicle and returned to the store. Mr. Salesman stated that the money wasn’t returnable, and now the buyers are upset. They contacted a lawyer to represent them, but soon approached me to question whether they had a case or not. This paper describes contract law and records my response Buyer.

Contracts are considered binding legal agreements. They can be held between two or more persons for whatever reason that is required (Laurence, 2016). Contracts are generally created when a person offers another person a product, service, compensation, or even to halt a process. If the offer is accepted then the contract is considered valid. Contracts are legally enforceable promises. Consequently, they are extremely valuable because they protect individuals against deceit and fraud while facilitating communication and promoting confidence. Instead of trusting others to fulfill the task, contracts assure that both parties remain beyond reproach and will meet obligations. Neglecting contracts provide a platform for vulnerability and human error. Alternatively, utilizing contracts allow people to understand all pertinent information entirely, reducing the probability of fault from each party.

Unfortunately, Mr. and Mrs. Buyers learned the hard way that without contracts and their supporting institutions, promises leave consumers open to various vulnerabilities. Admittedly, some issues arise out of malice; however, misunderstandings, forgetfulness, and other human errors contribute significantly to breakdowns. Admittedly, this particular situation may not have occurred as a result of malice; however, it is unnerving because of Mr. Salesman’s persistence. Because no contract was signed and there is nothing in writing regarding the deposit, then it would appear that the dealership is in error. The purpose of contracts is for people to reach agreements regarding topics. Since my friends made no agreement nor did they give their consent to purchase the vehicle then it appears that this exchange is well outside of a legal framework.
Contracts cannot be confused with verbal agreements. Courts have established the primary tenets required for a contract is to exist to clarify all promises and agreements. First off, contracts are legally defined as a voluntary, legal, written agreement made by lucid persons. The contracts must contain: (1) an offer; (2) an acceptance; and (3) consideration, or an exchange of value (DiMatteo, 1997). Admittedly, there are legal exceptions to the conditions above; however, it’s all subject to the court’s interpretation. It’s important to mention that not all contracts are written, some are verbal; however, these types are a lot harder to prove. Mr. Salesman might attempt to state the agreement to purchase the car was verbal; however, it will be difficult for him to establish these as commercial companies do not usually generate sales based upon promises. To do so would be unprecedented.

The most standard utilized contracts are the contracts for sale, whereby persons acquire ownership of property in exchange for a payment of a particular type. This kind of deal is pertinent, but it’s invalid because neither party agreed to a sale. As a result, no agreement was created. Consequently, there is no promise of payment. Since there was no guarantee of payment, the dealership is obligated to return any money received. Mr. and Mr. Buyers have a right to be upset as the dealership is behaving unprofessionally and unjustly. Arguably, they gave money to guarantee the car would remain at the dealership; however, there was no offer nor was there an agreement reached by the parties.

Contracts are considered more than an agreement between two individuals. For contracts to be viable, there must be an offer and acceptance, intention to create a legally binding agreement, a price paid, a legal capacity to enter a contract with free will, and a comprehensive understanding combined with the consent of all conditions involved (Laurence, 2016). If any duress, false statements, undue influence or unscrupulous events occur, then the contract may be considered illegal and void. Likewise, Mr. and Mrs. Buyer’s suppose contract may be regarded as invalid as the party never consented, understood or accepted any terms. Also, it is void because Mr. Salesperson announced, after the fact, terms that were never agreed upon by both sides. Consequently, Mr. and Mrs. Buyer are owed 100 dollars.




DiMatteo, L. A. (1997). The Counterpoise of Contracts: The Reasonable Person. South Carolina Law Review.

Laurence, B. (2016). Contracts 101: Make a Legally Valid Contract.


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