Understanding Business Law: Obligations and Contracts

In business law, obligations are legal duties binding parties to act or refrain from acting. They originate from contracts, torts, or law, and can be moral, civil, or natural, each with varying degrees of enforceability.

Contracts are mutual agreements creating obligations enforceable by law. Essential elements include offer, acceptance, intention, consideration, and capacity. Without these, contracts may be void or voidable, impacting the enforceability of obligations.

Contractual obligations require parties to perform specified duties. Failure to perform, termed 'breach of contract', may lead to remedies such as damages, specific performance, or cancellation, depending on the breach severity and contract terms.

Beyond typical sales or service contracts, business law recognizes unique forms like 'adhesion contracts' where terms are set by one party, or 'aleatory contracts' depending on an uncertain event, often used in insurance.

Online contracts are ubiquitous in e-commerce but present unique challenges like ensuring electronic consent and authentication. Regulations like the E-Sign Act ensure that e-contracts are as enforceable as their paper counterparts.

Contracts imply a covenant of good faith and fair dealing. Parties must not undermine the contract's spirit, ensuring honest, fair play. Violations can lead to tort claims independent of the contract itself.

Cross-border contracts introduce complexity due to differing legal systems. The United Nations Convention on Contracts for the International Sale of Goods (CISG) provides a framework to unify and simplify international trade contract law.