An agreement between at least two persons which is enforceable at law.
A contract requires three elements:
1. A "meeting of the minds" (also known as consensus ad idem or an offer coupled with an acceptance);
2. In common law jurisdictions, that elusive concept of consideration (something must flow from each party); and
3. Compliance with common law or statute law such as the subject matter of the contract must not be illegal and the parties must “competent to contract” (corporations or adults but not the mentally disabled).
The contribution of contracts and contract law to the world in fostering peace and economies cannot be understated. The most eloquent expression of this phenomena came from Henry Sidgwick in The Elements of Politics, 1879, Ch. 6:
" Withdraw contract … suppose that no one can count upon the fulfillment of any engagement … and the members of the human community are atoms that cannot effectively combine; the complex co-operation and division of employments that are the essential characteristics of modern industry cannot be introduced among such beings.
"Suppose contracts freely made and effectively sanctioned, and the most elaborate social organization becomes possible.”
See also the extensive Contract Law section.