A business agreement may be made when one party makes an offer to the other and the second party accepts. Offer and acceptance are foundational elements of contract formation, but so, too, is consideration. This post will offer Florida readers an explanation of what constitutes valuable consideration. However, readers should not use this post as legal advice or guidance.
Consideration is the value of the deal to the parties. For example, if an offeror offers to buy a car from an offeree and the offeree accepts, an important issue has not been addressed: the price. In consideration of the offer and acceptance, the offeror may agree to pay $25,000 for the car and the offeree may accept the sum in exchange for releasing their rights to the car.
Consideration can take on many forms, while also giving value to the transaction being completed in the contract. Depending upon the needs and goals of the parties entering the contract, consideration may be big or small. When a contract is modified and the terms changed, the amount or type of consideration utilized in the agreement may also need to be changed.
Along with an offer and an acceptance, consideration is an important element in a successful business contract. Determining how to draft a contract with valuable consideration can be tricky and, for this reason, business owners can work with business law attorneys on these and other important matters. The failure to include all necessary elements in a contractual agreement may cause it to be challenged and invalidated in court.