The Theory of Contracts

The Theory of Contracts is the legal framework that governs agreements between parties, ensuring that promises are honored and obligations fulfilled. It relies on the idea that when people or entities enter into a contract—whether written or verbal—they voluntarily agree to specific terms. If one party fails to meet their commitments, the other can seek legal remedies. The theory emphasizes principles like mutual consent, consideration (something of value exchanged), and intended legal accountability. Ultimately, it provides a structured way to create, interpret, and enforce agreements, promoting trust and stability in business and personal interactions.