Elements of Contracts

The requisite elements that must be established to demonstrate the formation of a legally binding
contract are (1) offer; (2) acceptance; (3) consideration; (4) mutuality of obligation; (5)
competency and capacity; and, in certain circumstances, (6) a written instrument.
Offer and Acceptance
Consideration
Legality of Subject Matter
Contractual Capacity
Contractual Intent

A valid contract has four basic elements under Louisiana law:

1. Capacity. The parties to the agreement must be legally capable of entering into a binding
contract. For example, a contract may be unenforceable if one of the parties is a minor
who is still under the legal authority of his or her parents.
2. Consent. Mutual consent to the agreement is established through offer and acceptance.
One party makes an offer; the other party accepts. Consent can be established verbally,
in writing or by some action or inaction that indicates consent. But the surest way to
establish consent is in writing. A good contract will make clear that the contracting parties
mutually consent to the same things and in the same sense.
3. Lawful Cause. When the cause of an obligation established by a contract is unlawful, the
contract is legally unenforceable. For example, if enforcing the obligation would cause one
party to commit a crime or violate public policy, the contract would be invalid.
4. Lawful Object. A contract made for an illegal or impossible object is unenforceable. For
example, a contract made for the purchase of illegal weapons would not be legally binding.