A contract is a legally binding agreement in which an organisation or individual offers the terms and conditions of the contract to one or more parties followed by a process of negotiation, acceptance, and agreement to the offered terms. 

Before a contract can be deemed enforceable by law, the process of consideration must take place, which means all parties must mutually consent to the terms and conditions of the contract. I.e. Party A promises to provide a service in return for Party B’s payment.

A vital element to consider when drawing up a legal contract is the intention of all parties. For example, in some cases there is no initial intention to make an agreement legally binding, therefore it cannot be classified as a contract by law. It is sometimes assumed that an agreement is legally binding, especially when dealing with commercial contracts.

The Law Commission have now officially confirmed the validity of electronic signatures when signing formal legal documents i.e. employment contracts.

The reason for the confirmation comes after confusion surrounding the legitimacy of electronic signatures, which resulted in many organisations being discouraged from using the electronic format.

Utilising electronic signatures allows organisations to process contracts in a quick and efficient manner.

Law Commissioner, Stephen Lewis confirmed this, stating: