Contracts are promises that the law will enforce. A contract is formed by two parties, in which a promise is stated. Failure to complete this promise will be resolved by law. The law provides remedies if a promise is breached or recognizes the performance of a promise as a duty. Contracts arise when a duty does or may come into existence, because of a promise made by one of the parties. To be legally binding as a contract, a promise must be exchanged for adequate consideration. Adequate consideration is a benefit or detriment which a party receives which reasonably and fairly induces them to make the contract. For example, promises that are purely gifts are not considered enforceable because the personal satisfaction the grantor of the promise may receive from the act of giving is normally not considered adequate consideration. Certain promises that are not considered contracts may, in limited circumstances, be enforced if one party has relied to his detriment on the assurances of the other party. Contracts are mainly governed by state statutory, common law and private law. Private law principally includes the terms of the agreement between the parties who are exchanging promises. This private law may override many of the rules otherwise established by state law. Statutory law may require some contracts be put in writing and executed with particular formalities. Otherwise, the parties may enter into a binding agreement without signing a formal written document. .
Whether if realized or not, today's society uses contracts everyday in order to maintain a fair and balanced social order. Usually these contracts are verbal, and not written, but when one needs to purchase something of great value, a written contract is an essential part of the business deal. Take a car for instance, committing to purchase/lease a car is extremely different then ordering a meal from a restaurant. Both are contracts but a cars value outweighs the value of a six dollar burger.
