CONTRACT LAW

What is Contract Law?

Contract law is a crucial component of both economic and interpersonal interactions. The formulation of contracts, the interpretation of contract provisions, and the remedies available
for breach of contracts are only a few of the numerous topics it covers. Understanding the
fundamentals of contract law is crucial if you want to be sure that the agreements you sign are
legitimate and enforceable.

What are the elements of a contract?

An offer, acceptance, consideration, and a common intent to be bound are the fundamental
components of a contract. An offer is a request from one party to another for entering a
contract. When the other party accepts the offer's conditions, acceptance has taken place.
When a party offers something of value to the other in return for a commitment, this is
referred to as a consideration. Finally, mutual intent to be bound denotes both parties' consent
to be held accountable for the agreement's provisions by law.

What are the different types of contracts?

Contracts can take a variety of forms, including written, oral, explicit, and implicit
agreements. Written agreements are those that are recorded in writing and bear the signatures
of all parties. Contracts that are made verbally but not in writing are referred to as oral
contracts. Contracts that are expressly declared and approved by both parties are known as
express contracts. Implied agreements that may be inferred from the behaviour and conduct of
the persons concerned are known as implied contracts.

Additionally, contracts can be categorised as unilateral or bilateral. In a unilateral contract,
only one party commits, and the other party is not obligated to take any action until the
commitment is honoured. A bilateral contract is one in which both parties make
commitments to one another and are expected to keep their commitments to one another.
Contracts can also be categorised as executory or executed. A contract that has been executed
has been fully carried out by both parties, but an executory contract has not yet been entirely
carried out.

When does a breach of contract occur and what happens when it occurs?

In terms of contract law, a breach of contract happens when one party doesn't carry out their
end of the bargain. The non-breaching party may be entitled to several remedies, including
compensation for losses incurred, specific performance, or contract termination. Damages are
sums of money paid to the non-breaching party to make up for any damages incurred because
of the breach. A court order forcing the party that violated the agreement to meet their
responsibilities is known as specific performance. Contract cancellation includes ending the
agreement and relieving both parties of their responsibilities.

What are the points to consider before entering a contract?

When entering a contract, it is vital to consider several elements, including the parties'
capability, the subject matter's legality, and the contract's conditions. Additionally, it is critical to guarantee that the contract is clear and that everyone involved comprehends its conditions. Before taking legal action, it is crucial to attempt to resolve any disagreements through
negotiation or mediation.

The names and contact details of the parties involved, a precise description of the subject matter, the terms and conditions of the agreement, and any guarantees or representations made should all be included when creating a contract. The contract should also provide clauses for ending the arrangement, settling disagreements, and transferring rights and duties under the agreement. All parties concerned should then sign and date the contract to show that they have read and agree to its conditions.

What is the scope of Contract Law in the UAE?

The concept of freedom of contract governs contracts under UAE law, which implies that
parties are free to engage in agreements on any conditions if such agreements are not
unlawful or contrary to public policy. The UAE Civil Code does, however, also include
restrictions on contracts, such as the necessity of the parties' legal capacity to agree and the
legality and viability of the contract's subject matter. The Civil Code also stipulates guidelines
for contract interpretation, such as the need that agreements to be read considering the parties'
shared intent. The Civil Code also specifies damages, specific performance, and contract
termination as remedies for breach of contract.

Depending on the nature of the contract and other applicable laws and regulations, contracts
in the UAE may be subject to additional legal requirements. For instance, the UAE Real
Estate Law may apply to contracts concerning real estate, whilst the UAE Labour Law may
apply to contracts regarding employment. Moreover, certain contract types, such as
construction contracts, could be governed by certain laws and specifications. To make sure
that your agreement is legitimate, enforceable, and in compliance with all applicable laws, it
is crucial to speak with a legal expert who is informed about the specific laws and regulations
that may apply to your contract.

It is critical to understand regional commercial and cultural conventions while creating
contracts in the UAE, as well as any potential language barriers. For instance, it is typical in
the UAE to hold lengthy discussions and develop a rapport with business partners before
signing a contract. Additionally, it is critical to make sure the contract is drafted in both
Arabic and English, as both have equal legal standing in the United Arab Emirates.

Contracts are often regarded as legally enforceable agreements in the UAE, and parties who violate
them may face repercussions. It is crucial to keep in mind that the UAE's legal system may work differently from that of other nations and that the procedure for resolving disputes may differ from what you are used to.

The material contained in this article should not be interpreted as legal counsel. If you have any
questions about this topic or are involved in any legal disputes relating to it, Hassan Al Riyami
Advocates and legal consultants will be pleased to talk with you during a 30-minute free legal