Enforceability means that an agreement consists of the necessary components in order to be able to be imposed under law. Depending on the type of agreement, these components can vary. If only one vital part is missing or wrongly written, the agreement may not hold up in court. This can have negative consequences for either party in an agreement.
In order for an agreement to be enforceable under law, it needs to include an offer, a consideration and the parties involved need to be mentally capable of understanding the contents of it.
Some agreements must be written to guarantee enforceability. This includes the following, among others:
As already stated above, an agreement is only enforceable if the parties involved are mentally capable of understanding the contents, or: “competent”. If a breach occurs and the breaching party’s competency at the point of signing the agreement is in doubt, a court may declare the agreement null and void.
The following are the basic criteria defining competency in a legal sense:
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