Discussion about the impact of different types of contract Classification of contracts

By type of formation

Express (is stated in words or oral, this contract is conscious)

Implied:

• Implied-in-fact (is manifested by conduct rather than words)

• Implied-in-law (is crested by operation of law in order to avoid unjust enrichment of one party)

By type of performance

Bilateral (is based on the exchange of promises)

Unilateral (involves a promise by one party and an act by the other party)

Executed (is one that is fully performed by both parties)

Executory (something remains to be done)

By enforceability

Valid (it meets all legal requirements and can be enforced by parties)

Unenforceable (does not meet all legal requirements)

Void (is made under threat or physical force)

Voidable (is made by minors, or under mental duress)

Type of the contract

Impact

Simple or oral contract is a legally binding contract, but it carries a risk.

It is difficult to enforce in the court because there is no evidence of the terms.

Contract in deed or written contract provides evidence of the terms and allows both parties to study terms – that makes a contract enforceable. Some contracts are only legal if they are in writing (property selling e.g. buildings).

The impact of the deed is that it makes it legal.

Void contract is not a contract. It never was a contract – it is void ab initio.

e.g. Selling something you do not own is a void contract. A contract for an illegal act is also void.

The impact of a void contract is that goods sold can be recovered, even if they have been sold on to a third party.

Voidable contract is a contract which can be made void in particular situations, for example one party is a minor. The contract is legally valid until it is made void.

The impact is that goods can be recovered unless they have already been sold to a third party, which would have been legal.

Unenforceable contract is legally binding, but cannot be enforceable by a court, for example there is no enough evidence.

The impact is that both sides are obligated to perform their part of the contract, but the court will not make you.

Unilateral contract is an offer made to the world at large, where acceptance is the performance of the duty specified.

e.g. reward poster

The impact is that contract is formed when performance is carried out or begun to be carried out.

Electronic contracts

e.g. emails

The impact is that have the same effect as written contracts.

Collateral contract is contract where one contract is used as consideration for another.

The impact is when one contract can be used as consideration for another.