The main purpose of contract law is to make voluntary agreements legally enforceable. It balances freedom of contract, the idea that individuals can choose their own terms, with fairness and public policy considerations.

Contract law protects:

• Reliance – people can trust that agreements will be honoured.

• Exchange – goods, services, and promises can be traded fairly.

• Expectation – those who suffer a breach can recover their expected benefit.

A contract is a legally binding agreement between two or more parties that the law will enforce. Most contracts are simple contracts, formed orally or in writing, though some must be in writing (e.g. land transfers).

To form a valid contract, there must be:

• Offer and acceptance – agreement between the parties.

• Consideration – something of value exchanged.

• Intention to create legal relations – both parties must intend to be legally bound.

• Certainty – terms must be clear and complete.

If any of these are missing, no binding contract exists.

Contract law in England and Wales is mainly common law, meaning it has been developed by judges through case decisions. Statutes also play a role, including:

• Unfair Contract Terms Act 1977 (UCTA) – restricts unfair exclusion clauses.

• Consumer Rights Act 2015 (CRA) – protects consumers in contracts with businesses.

• Law Reform (Frustrated Contracts) Act 1943 – governs the effect of frustration.

• Freedom of contract: parties are free to make their own bargains.

• Pacta sunt servanda: agreements must be kept.

• Fairness: limits on unfair terms and unequal bargaining power.

• Certainty: courts will enforce clear and deliberate promises, not vague or incomplete ones.

When one party fails to perform their obligations, the innocent party may claim a remedy, such as:

• Damages – to compensate for loss.

• Specific performance – a court order to carry out the contract.

• Injunctions – to prevent a party from breaching the agreement.

These remedies aim to place the claimant in the position they would have been in had the contract been properly performed.

Contract law is divided into two main areas:

• Formation and validity – how contracts are made and what can make them void or voidable.

• Performance, breach, and remedies – how contracts are carried out, discharged, or enforced.