We now turn to the four key legal elements necessary to create a contract. These
elements in effect represent a checklist for use in your future negotiations.
1. Reach an Agreement：The requirement that parties reach an agreement is fairly straightforward. One party makes an offer; the other party accepts the offer.
2. Give Up Something as Consideration
Consideration is a common law requirement. While consideration has a technical legal
definition, in everyday language it means that for a deal to be legally binding, both sides
must give up something. For example, if a graduate promises to donate $20 million to
her university in a written signed agreement, the agreement is generally not binding
unless the university promises to give up something in return.
3. Stay Within the Law
A contract that calls for the violation of a law is not enforceable. In many cases—for
example, a contract to sell illegal drugs—this element is uncomplicated and easy to
understand. In other situations, where there might be a violation of public policy, the law
is more complex.
4. Put Your Agreement in Writing
Writing requirements raise important and complex concerns during negotiations. Both
civil law and common law countries have rules providing that certain contracts must be in
writing.
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