Contracts are a vital part of every successful business’ operations. They allow companies to acquire supplies, sell goods and services, and partner with other businesses for vital operations. With New Jersey’s vibrant economy and high per capita income, strong, predictable contract law is extremely important. If you are going into business with another company or agreeing to any arrangement, you need a clear contract to govern the relationship. Through Priori Legal's on-demand marketplace, you can connect with contracts attorneys who have precisely the experience and expertise you need.
Creating a Strong Contract in New Jersey
Under New Jersey contract law, a valid contract must have, at minimum, an offer and agreement between at least two parties who are capable of forming a contract, as well as some form of consideration or payment.
Of course, a valid contract is not always a strong contract. Unless the contract clearly spells out the details of the agreement, it is unlikely to have the intended effect. In fact, a contract in which a read on the face of the agreement does not make what is being agreed clear may be thrown out on the principle that agreement could not have been possible. That’s why a strong written contract is as specific as possible about expectations of the parties. There will usually be definitions of terms, statements of agreement on purpose, clearly delineated obligations of the parties, warranties, guarantees, and representations. A New Jersey contract lawyer is usually in the best position to help you draft the strongest possible contract for your needs.
Business Customer Contracts vs. Consumer Customer Contracts
Customer contracts for the provision of goods and services are the most common contracts that fall under New Jersey contract law. While these are always quite similar in structure and content, certain aspects of customer contracts between two businesses will usually be quite different than consumer contracts. Freedom of contract gives parties a wide latitude to dictate their own terms and agreements, especially in business contracts. This includes the right to allocate risk in a way that heavily favors one company over the other, the right to waive litigation in favor of arbitration only, and a pricing or delivery schedule skewed to a single parties favor. If both parties sign, these agreements will almost always be held up in court.
Freedom of contract is much more limited in consumer contracts. Because consumers have much less influence over the contract process, companies contracting with individual, average consumers are forbidden by consumer protection laws from clauses that overly favor the company. Skewed allocations of risk, predatory pricing, and non-litigation clauses are all illegal through FTC regulations and laws enforced by the New Jersey Office of Consumer Protection. Consumer protection laws ensure that consumer contracts are clear and do not favor the more dominant party in ways that are overly unfair.
International Contracts Under New Jersey Law
New Jersey law commonly governs contracts with parties in different countries, especially when at least one company is located in New Jersey. New Jersey has accepted the Uniform Commercial code for the sake of transactions in goods, which means that the United Nations Convention on the International Sale of Goods (CISG) therefore forms much of the state law for international contracts. This makes New Jersey contract law particularly appealing for parties in signatory states. The CISG makes legal outcomes predictable, something vitally important to any company involved in international trade.
New Jersey Breach of Contract
A contract serves a company no purpose unless it is enforceable. That’s why the law provides for the ability bring a lawsuit if one party does not fulfill their obligations under the contract. This is known as a breach of contract. In order to successfully bring a case for breach of contract, you must prove four things in court:
1. The parties have a valid contract.
2. The plaintiff carried out their duties under the contract.
3. The defendant did not, thus making a material breach of their duties under the contract.
4. This breach caused the plaintiff economic harm.
If these four elements can successfully be proven, you are entitled to damages for the measurable economic losses suffered due to non-performance by the other party. If fraud is involved, you can also get punitive damages equal to up to three times the original loss under the New Jersey Consumer Fraud Act.
Can I enter into a verbal contract in New Jersey?
Yes, verbal contracts in New Jersey are binding, so long as they contain the essential elements of a valid contract, and there is sufficient proof of contract. Still, it is always best to get such agreements in writing.
Can anyone make New Jersey contract law applicable to their contract?
If you choose, you can make New Jersey law the governing law of any contract, regardless of its connection to the agreement made. If no governing law is named in the contract, New Jersey contract law will only apply if the courts determine that there is a substantial connection to New Jersey and that New Jersey law would be well-positioned to ensure a predictable outcome from the contract as it was intended.