Whether you’re a business owner or an employee, the chances are great that you’ll encounter at least one contract during your career. Contracts help explain the obligations that both parties are expected to fulfill. It’s a way to protect your legal interest in whatever agreement you’re entering into. And nearly all contracts are subject to contract law in the state of New York. Here’s what you need to understand about contracts and contract law.

New York contract law

What Is a Contract?

Before we go deeper into what contract law is, we first need to discuss what contracts are from a legal perspective. Contracts are agreements between two or more parties that explains which tasks, actions, or obligations each party is responsible for. Typically, these contracts are written documents, but they can be verbal agreements in some instances.

How Can You Tell If Contracts Are Valid Under New York Law?

Under New York contract law, contracts must meet specific requirements to be considered legally binding. These are the factors that contracts must satisfy to be upheld:

  • Parties must be in mutual agreement: The contract must clearly show that both parties agree to the terms. This is typically accomplished through signatures or verbal agreements. 
  • There must be a clear exchange: Contracts shouldn’t encourage work for free. They must outline some kind of clear exchange like money or in-kind goods in exchange for something else. For example, employment contracts must stipulate wages and benefits in exchange for the scope of work the employee is responsible for. 
  • The contract must cover legal activities: Contracts covering illegal activities are not legally binding. To be enforceable, all activity outlined in the contract must be legal and enforceable by the law. 
  • Both parties must be competent: Contracts entered into where one party is not able to make informed decisions on their own may not be enforceable. 

This is just the beginning. If you’re trying to create a truly legally enforceable contract, it’s best to work with an experienced Albany business law attorney. They’ll be able to review the contract before you sign to make sure all terms are clear and enforceable.

What Is a Breach of Contract and What Happens If You’re in Breach?

A breach of contract means you’re violating the terms outlined in the contract. Once this happens the party you’re contracted with may be able to take legal action against you for violating those terms. Some common forms of breach of contract include the following:

  • Not delivering goods or services by an agreed-upon deadline
  • Not paying for work performed
  • Not fulfilling the terms of the contract in full

If you breach your contract, it could cost you money, and if someone breaches a contract that impacts you, you’ll want to get legal help as soon as possible. An attorney who works on litigation (lawsuits) can advise you on the next steps to take. 

Why Working With an Albany Business Law Attorney

Working with an Albany business law attorney is the best way to make sure a contract is legally enforceable and covers all the terms and conditions you need it to before you sign on the dotted line. Attorney Sarah Gold can help. She has years of experience helping new and established businesses alike create contracts that are thorough and legally binding under the law. Schedule a consultation today.