Offer: It is a promise made by one party to pay the other for their services. For example, you could agree to pay a graphic designer $100 to create a logo for your company. You agree to pay a deposit and the balance upon electronic delivery of the logo in formats suitable for both print and online marketing. Other terms and conditions, such as the graphic designer relinquishing copyright to the logo, are frequently included in the offer.
Acceptance: It occurs when the other party agrees to perform the task for the agreed-upon compensation. In this case, it is when the graphic designer accepts the deposit and agrees to the price.
Mutual assent: Mutual assent is the result of a valid offer and acceptance by both parties. A signed contract demonstrates mutual agreement. In the absence of a written contract, the actions taken by the parties after the offer is made and accepted can demonstrate mutual assent. For example, mutual assent could occur after you've given the graphic designer a deposit and they've provided you with three rough concepts for your logo.
Consideration: "Consideration" refers to the amount of money paid in exchange for goods or services. Money is usually, but not always, taken into account. In exchange for the accountant doing the lawyer's taxes, a lawyer might write a lease agreement for the accountant. In the graphic design example, you agreed to pay the remaining $100 fee when the designer delivered a logo that you approved as appropriate for your company.
Capacity: Capacity refers to a person's presumed ability to understand the terms, obligations, and consequences of signing a contract. Minors, people suffering from illnesses such as dementia, and anyone under the influence of alcohol or drugs are presumed to lack the capacity to enter into a binding contract.
People who cannot read the language in which the contract is written lack capacity but would gain capacity if a translated copy of the contract was provided. In general, a person must understand the meaning and effect of the contract's words. If one party took advantage of the other party's incapacity, the contract can be voided in court.
To be legally correct: The contract must follow the laws of the jurisdiction in which it is signed. For example, suppose you sign a contract to lease your garage to a very loud rock band for $10 per week beginning at 11 p.m. You later discover that their behaviour is in violation of a local noise ordinance. That contract is null and void, regardless of whether you enjoy the music or whether the band paid the rent. Similarly, if the graphic designer you hired submitted another company's logo as their original work, you would not be required to pay $10.