Contract is a promise that enforces parties to carry out his promise, who have entered into a contract and set up a promise. Contract is a binding legal agreement and an exchange of promises with a specific remedy for breach. Contract must not be trifling, indeterminate, impossible, or illegal. Contract has several functions. First, contract simplifies the problem of ascertaining the contents of the agreement. (Edwin Peel, 2007)Secondly, contract has a warning effect. (Edwin Peel, 2007) Thirdly, mainly, contract has a protective function because contract can protect weak party against other party breaks his promise. (Edwin Peel, 2007) Remedy include pay damages as money, other special cases include rescission of contract, injunction and rectification of a written contract. (Syed Ahmad, 2003)
1.2. The contents of a contract
The contents of a contrast depend primarily on the words used by the parties in the contract. (Edwin Peel, 2007) Before parties entered into the contract, simplify the contract clearly and plainly is very necessary and ascertain the extent of the obligations. (Syed Ahmad, 2003) The contents describe that one person signifies to another, what offer he is willing to do or to abstain from doing anything. (Syed Ahmad, 2003) Additionally, contents also have to ascertain that only who are parties in the contract or privy to a contract can sue or be sued on it. (Syed Ahmad, 2003)
1.3. Why to make the contract?
If a party is afraid of another party breaks promise, he can set up a contract to enforce another party to carry out. Therefore, contract like an enforceable agreement. (Edwin Peel, 2007)
If a party breach his promise that should pay his compensation for the damage loss or injury and therefore party is contempt of court. (Syed Ahmad, 2003)Another remedy is injunction that prevents a party earning his benefit from another way if the party can still perform other work. (Syed Ahmad, 2003) Additionally, another is rescission, if...