Agreements to Agree Unenforceable

Agreements to Agree Unenforceable: What Does It Mean?

In the world of law, contracts are considered binding agreements between two parties. Contracts contain specific terms and conditions that both parties agree to follow. However, what happens when a contract contains an agreement to agree? In this article, we’ll explore what agreements to agree are and why they are often unenforceable.

What is an Agreement to Agree?

An agreement to agree is a clause in a contract that outlines a future agreement that the parties plan to enter into. This clause usually states that the parties will agree to the terms and conditions of the future agreement at a later date. For example, a contract may include a clause stating that the parties will agree to the price of a product or service at a later date.

Why are Agreements to Agree Considered Unenforceable?

Agreements to agree are considered unenforceable because they lack the specificity required to form a valid contract. In order for a contract to be enforceable, it must contain specific terms and conditions that both parties agree to follow. Agreements to agree often lack these specific terms, making them unenforceable.

Courts have consistently held that agreements to agree are not legally binding. This is because they do not contain concrete terms and conditions that can be enforced. Instead, they are merely agreements to negotiate or discuss the terms of a future agreement. As a result, if one party fails to negotiate or agree to the terms of the future agreement, the other party has no legal recourse.

How to Avoid Agreements to Agree

If you’re drafting a contract, it’s important to avoid agreements to agree. Instead, include specific terms and conditions for all aspects of the contract. This includes the price, delivery, and any other terms that are important to both parties. By including these specific terms, you can ensure that the contract is legally binding and enforceable.

Conclusion

Agreements to agree are a common occurrence in contracts. However, they are often unenforceable because they lack the specificity required to form a valid contract. As a result, it’s important to avoid agreements to agree and include specific terms and conditions in all contracts. By doing so, you can ensure that the contract is legally binding and enforceable.