To create a binding agreement the acceptance must occur, and that Research Paper

To create a binding agreement the acceptance must occur, and that 'acceptance' must be final and absolutely unconditional - Research Paper Example A contract legally binds the signees of the contract to the terms spelt out in the contract. A breach of the terms spelt out in the contract makes an individual who is party to the contract to be liable to prosecution by law. Acceptance is an element of contracts that should be featured in a contract for it to be legally binding. This paper aims at highlighting acceptance under Australian contractual law and how it impacts on businesses and the judicial system in the country. Contractual acceptance is characterized by a party in the contract agreeing to the terms and conditions of the offer that is proposed by the other party. A contract is not formalized until the party being proposed to, accepts the offer at hand. The contract can then be termed as legally binding after the offer has been accepted. A contract can also not be formalized until all the negotiations regarding the terms and conditions of the contract have been finalized. Acceptance can be defined as an unqualified assen t to all terms of the offer for example, when a buyer makes an offer to the seller of which the seller accepts the offer from the buyer (SINGH & KAUR, 2011:120). Acceptance in contract formation includes the arrival at a consensus between the parties involved on the terms and conditions defining the contract. For acceptance to be realized, an offer by one of the parties involved in the contract should be proposed. This creates the opportunity to for the other member analyse the offer and present their judgment by accepting the offer or agreeing in an unqualified way. This means that offeree assents the offer but on condition that some of his terms are also accepted by the offeror (SINGH & KAUR, 2011:185). An offer must be distinguished from an invitation to deal because it involves testing for intent from the party making the statement. It depends on whether the response would result to an agreement or simply translate to further negotiations. An example of this scenario is a court case between the Great Britain Pharmaceutical Society v Boots in which the English court of appeal provided emphasis on the commercial influence and classification of the conduct as an offer (SINGH & KAUR, 2011:190). A contract is formed when an offer by one individual is accepted by the other party involved in the negotiations. An offer can be made to one person, a class of persons or to the whole world as long as the specifics of the terms and conditions of the offer are clearly defined for all parties involved. An offer is part and parcel of acceptance because it determines the realisation of acceptance depending on the terms of the offer. Thus, an offer is a definite promise to be bound to, provided the terms of the offer are accepted. This means that acceptance is realised when the precise terms of the offer have been accepted. If the precise terms of an offer are not accepted, then it means that the offer is still under negotiations, and it cannot be said that the acceptance s tage has been reached and finalised. Negotiations indicate that the basic elements of which acceptance is part of, have not been met, and therefore negotiations are ongoing. An offer can be withdrawn before it is accepted, but it requires the offer or to inform the other party about the withdrawal of the offer. This makes it possible to avoid a binding contract because the