Enforcement of Contracts in Business - Thesis Example

The paper "Enforcement of Contracts in Business" is a great example of a thesis on business. What is the contract? Firstly, it is important to start with the understanding of the term contract, from the author's point of view the definition provided below suits the topic chosen due to several reasons and therefore a “Contract is a specification of actions that named parties are supposed to take at various times, generally as a function of actions that hold. Usually, the actions are related to the delivery of goods, the performance of services, and payments of money, and the conditions include uncertain contingencies, past actions of parties, and messages sent by them.

”1 In addition to that, it is important to understand that contract formation involves various stages that include the parties of the contract and their interests to create contractual relationships, including communication between them before and while the contract is being created, as well as legal consequences of entering in such relations. When two parties decide to engage in an act of conducting business (transaction) they usually have some informal meetings beforehand, which precedes the formation of a formal binding contract, a contract that is approved by the court, in which both sides commits to fulfill all the obligations written in the contract.

2 This meeting seeks to set out the conditions and terms in the contract. It defines what each party to the contract expects from the contract or transaction between parties. The discussions during such meetings ensure each party to the contract benefits from the agreement arrived at. Once all the parties involved have agreed on terms to a contract, it becomes legally binding. If one of the parties is not satisfied with the result of the negotiation, it can easily resign without any legal consequences.

Several reasons can be mentioned in order to understand why contracts are necessary for any individual who is willing and able to transact. One of the reasons is the future provision of goods and services, in other words, if one party wants to order goods, and another party can supply these goods, then a contract is necessary for such a transaction. It can be attributed to goods that are not available on markets, but mainly for custom or specialized goods. Secondly, contracts are concluded due to the reallocation of sharing of risks.