2. Do You Know Your Rights - Starter

3. Definition of a Contract:  Definition:  A legally binding agreement, giving rights and obligations to the people involved, which the law recognises and will uphold

4. A Valid Contract:  Must Consist of 6 Points  1. It must be serious and commercial  2. Offer and Acceptance must be Present  3. Exchange must occur  4. People must have Capacity  5. Consent must be Freely Given  6. The Activity must be Legal

5. 1. It must be Serious and Commercial:  Making a purchase from a shop, or buying a house would be the best examples of serious and commercial transactions.  Discussion

6. 2. Offer and Acceptance must be present:  Someone makes an offer – if you accept it, this means you have entered a binding contract.  Example – I go the farmers market and barter about some eggs – She offers me the price of $2, I say yes and agree to the price.  Discussion

7. 3. Exchange must Occur:  People must exchange something of value  You “Consider” how much something is worth. “Consideration is the key word.  Example – John fixes Jill’s Car. John’s mechanical abilities is his consideration. Jill pays John $400 for his work. The $400 is the consideration Jill pays.

8. Activity  Cloze Activity – Contracts

9. 4. People must have “Capacity”  A person must have the ability at the time of entering a valid contract to fully understand what is happening.  Example – The person cant be drunk during signing a contract.  Discussion!!!

10. 5. Consent must be Freely Given  The people involved in a contract must freely agree to the terms of contract  Example – You go to a store to look at buying a new TV – the attendant threatens to beat you up if you don’t buy this TV.

11. 6. The Activity must be Legal:  Courts will only support a wronged person if the activity the contract involved in is legal.  Examples