Contract Law

An important theory on whether a party has truly a contractual right and obligation is based on the concept of a “meeting of the minds.” The purpose of this article is to give you a brief flavor of how to use that to increase your odds of getting what you bargained for.

Since BiggerPockets is a real estate investing site we would be missing the boat if we failed to mention the “statute of frauds,” which – while very sinister sounding – – just means that contracts for real estate must be in writing to be enforceable (Note: other certain contracts fall into this rule as well).

Like real estate, there are a lot of nuances that are involved in whether you do or do not have a deal that can be legally enforced. The scope of this article is to talk about the theory behind the rest of the details. If you have a specific situation, your state law will be very important and the facts are very important. This is not intended as legal advice.

First the Definition:

Meeting of the Minds n. when two parties to an agreement (contract) both have the same understanding of the terms of the agreement. Such mutual comprehension is essential to a valid contract. It is provable by the express provisions of a written contract, without reference to any statements or hidden thoughts outside the writing. There would not be a meeting of the minds if Bill Buyer said, “I’ll buy all your stock,” and he meant shares in a corporation, and Sam Seller said, “I’ll sell all my stock to you,” and meant his cattle (For more information, see http://legal-dictionary.thefreedictionary.com/meeting+of+the+minds)

The trick to this concept is the difference between what we think and …read more