I’m going to spend the next few Wednesdays (and Thursdays) discussing the elements of a contract. (Note the spiffy new blog category.) Since I’m teaching a Master’s Class on publishing contracts at the Rocky Mountain Fiction Writers’ Colorado Gold Conference in September, I thought I’d post the preliminary “What is a Contract” talks here. In writing, prologues are often a no-no, but in education it’s often considered helpful to know the basics before you proceed to advanced-special-topics. (Often. Not always. Witness the lone Mechanical Engineering course on my transcript – graduate level – which people have asked about ever since. But I digress.)
Step 1: What is a Contract?
If I promise to give a platypus to everyone who reads this blog for a year, is that a contract?
If I promise a platypus to you because you read yesterday’s entry about my aquarium, is that a contract?
If I promise the platypus to make sure it receives a good home – is that a contract?
Would it matter if the platypus cannot read? If we pinkie-swear? If I offered money instead of a pet or if I could prove the origin of the platypus? (Note to the wise: beware of lawyers bearing inappropriate house pets of dubious provenance.)
To discover the answer we have to know a little about the law. Many people think of contracts as “agreements” or “promises” – to do or not to do something for yourself or another person. (For purposes of this series and the law, a company or organization is a “person” and can enter into contracts provided the right person makes the agreement on the company’s behalf. For example, the company president often has authority to enter into contracts. The individual who cleans the bathrooms generally does not.)
The law says that a contract is “an agreement which creates legally enforceable obligations.” In English – a contract is an agreement you can force the other person to comply with, often by means of a lawsuit. People make all kinds of promises and agreements which are not contracts – not because the parties didn’t intend it but because the law refuses to recognize the promises as enforceable. An unenforceable agreement isn’t illegal but it creates no remedies – no recourse for a party in the event the other party won’t perform.
The key, then, is knowing whether your contract is enforceable or merely an “illlusory” promise to do something the other party won’t actually have to do if he changes his mind.
Generally speaking, a valid, enforceable contract requires five things: an offer, acceptance, consideration (which has more to do with platypuses than kindness), proper parties, and appropriate subject matter. (The last one actually encompasses several issues, but we’ll split those out in the proper time.)
A lot to take in at once.
You’ll notice the things I didn’t mention as required. A contract doesn’t always have to be in writing (though publishing contracts almost always do, because of a different law – more on that in a week or two). It doesn’t have to involve money, or the transfer of goods and services. It doesn’t always have to be signed by everyone involved – and sometimes contracts can be enforced by people who weren’t parties to them at all.
Makes your head spin, doesn’t it?
Before this series is through we’ll discuss all the elements of a contract, how many platypuses it takes to make an agreement legal, and whether or not you get a new pet if you read this blog for a year. (A spoiler: you don’t. At least not from me.)
Tune in Wednesdays and Thursdays for all the exciting details. If a little platypus knowledge is a dangerous thing, let’s make you public enemy number 1.
* DISCLAIMER: I am a real lawyer but you are not my client. This blog, this entry and the content hereof are for educational and information purposes only. This is not intended as legal advice to any person or entity. The laws of your state, country, fiefdom or treehouse may vary. Legal situations are fact-specific and the analysis of a contract (like any other legal issue) should be handled by a professional and on its specific terms. If you have a legal issue, you should hire an attorney to assist you. Otherwise, the other side will hire a big, scary lawyer with huge teeth and a giant stick, who will use you as his personal pinata until you agree to give him your lunch money, your first-born child and your rubber-band collection. And that’s just for starters. Do not try this at home.