What kinds of contracts are there that I might encounter?

As a business professional, you are likely familiar with the written agreement as the foundation for doing business both with other businesses and possibly with individual consumers as well. But there are other kinds of contracts that you may find yourself confronted with, some intentionally and even some not so. This post will go over some of these other contract types.

The oral agreement: As long as your contract is not for the sale of goods valued at $500 or more -- in which case the Illinois adaptation of the Uniform Commercial Code will apply and require that the contract be in writing -- there are times when you can enter into an oral agreement. In business, it is difficult to see why you would want to make an oral contract, given its problems when it comes to interpreting what it means. But you at least want to be aware of its existence, so you can avoid inadvertently entering into one.

The quasi-contract: Related in some ways to the oral agreement, this "contract" is actually one that a court may impose on parties who had no formal agreement, but whose behaviors demonstrate that they are acting like they have a contract. If your course of performance and course of dealing with another business have gone on long enough in the absence of a formal contract, then you may want to consider formalizing your arrangements before a court takes it upon itself to "fill in the blanks".

The express contract: This is the written agreement that you are probably familiar with. It can be negotiated in advance, or arise in the exchange of the terms and conditions on purchase order forms and order acknowledgement forms.

If you have questions about whether you are in a contractual arrangement with another business or someone else that is not an express agreement, consulting with a business law attorney can be an important step to help determine whether you are in an oral or quasi-contract situation, and what you can do if that is indeed the case.

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