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Simple English definitions for legal terms
binding agreement
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A quick definition of binding agreement:
A binding agreement is when two or more people agree on something and promise to do what they said they would do. It can be about things that happened in the past or things that will happen in the future. It's like making a promise to someone and keeping that promise. Sometimes, there are rules that need to be followed to make the agreement official and enforceable.A more thorough explanation:
A binding agreement is a mutual understanding between two or more people about their rights and duties regarding past or future performances. It is a manifestation of mutual assent by two or more persons. The parties' actual bargain is found in their language or by implication from other circumstances, including course of dealing, usage of trade, and course of performance.
Examples of binding agreements include:
- An agreement of sale that obligates someone to sell and may include a corresponding obligation for someone else to buy.
- A trust agreement that outlines the terms and conditions of a trust.
- A postnuptial agreement that outlines the division of assets in case of a divorce.
These examples illustrate how a binding agreement is a legally enforceable contract that outlines the terms and conditions of a mutual understanding between two or more parties. It is important to have a binding agreement to ensure that all parties involved understand their rights and obligations and to avoid any misunderstandings or disputes in the future.