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Distinguish between agreement and contract

August 30, 2019

Distinguish between agreement and contract
Sir Fredrick Pollock defined contract in his book, Principles of Contract, as a promise of set of promises which the law will enforce.  However, an agreement is referred to a concept that involves an understanding or an arrangement between two parties regarding their duties and rights subject to another. Hence, an agreement do not need to be legally binding in the sense of law. However a contract need to be in accordance to the law. The purpose of a contract should be legal, as illegal contracts would be void. However, domestic agreements between people might be even illegal.
Furthermore, contracts are usually in written form as they are formal and might be needed to use in the courts or other authorities. However, agreements are less formal and could be either in written form or oral.
There are main two elements in an agreement which are offer and acceptance. However, contracts need to have an offer, acceptance, consideration, capacity, meeting of minds, legality and written form to be accepted as valid contract.
In the sense of nature, agreements are complex and wider in scope. However, contracts are narrow and not complex in their nature. And in the sense of obligations, an agreement would usually involve a domestic or a social obligation. However, a contract would involve a legal obligation which parties should fulfill according to the law.
Hence, the main difference between a contract and an agreement is that a contract is legally enforceable as contracts have legal backing. However, agreements do not need to be legally enforceable as they can be in verbal form too. Therefore all contracts can be called agreements, but all agreements could not be called contracts.  Moreover, contracts and agreements can also be differed in the sense of their elements.

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