A contract agreement is a written formal document which is drafted between two parties whenever they agree on a set of mutual terms and conditions. Such contract agreements are applicable only for certain duration of time and mostly have a certain amount of money involved. Any contract agreement can also be a verbal understanding but the more practical method is to have a written piece of document which is well detailed and acts as a proof in case of any confusion during the course of agreement.
- The main areas which are written down in a contract agreement are the dates of commencement and termination, duration or length of contract agreement, the various legally binding terms and conditions, the details of the involved parties such as their names, titles, contact numbers, addresses.
- Another main section of a contract agreement is the part where the money matters are discussed in detail.
- Even the duties and responsibilities of the parties form a vital section of any contract agreement.
Being legally binding documents in nature, it is important and obligatory for all the parties to abide by the terms of the agreement which are mentioned in the contract agreement. In the case where one or both of the parties fails to agree to the contract obligations, the related laws come into play and a legal body of the state is appointed to resolve the dispute and ask for compensation from the party at fault. This particular legal binding nature makes a contract agreement an extremely important document and gives assurance to both parties about financial security during the course of agreement. Without having the legal nature, the chances of fraud increases. There can be various different types of contract agreements depending upon needs and requirements and some of them include construction contract agreement, export contract agreement, vendor contract agreement and many others.