What is an express contract? 

An express contract is a legally binding agreement where all terms and conditions are explicitly stated, either in writing or verbally. Involved parties review and agree to the contractual terms, reducing the risk of misinterpretation.

For example, when a business signs a contract with a vendor specifying the price, delivery dates, and payment terms, it forms an express contract. Because the details are clearly stated and acknowledged, any disputes or non-compliance can be solved legally.

Isn't that the case for all contracts?

No, there are exceptions. Express contracts differ from implied contracts.

Express contract vs. implied contract   

While express contracts explicitly outline terms, implied contracts do not involve explicitly stated terms or verbal consent. Instead, they are formed based on actions, behavior, or circumstances. However, both types of contract are legally enforceable.

For instance, visiting a doctor creates an implied contract. Though no written agreement exists, by seeking treatment, you agree to pay for the service provided.

Elements of an express contract

Express contracts are valid when they include the following key elements.

1. Offer and acceptance  

Every express contract starts with a clear offer and acceptance. One party proposes a specific agreement, and the other accepts or declines the terms.

• Offer: An offer is when one party proposes a service, product, or obligation in exchange for value.

• Acceptance: Acceptance occurs when the other party agrees to the terms, either verbally or in writing.

2. Consideration  

A valid express contract requires consideration—something of value exchanged between parties. This could be money, services, or goods.

3. Mutual intent  

Both parties must have a clear understanding and agreement on the terms. This "meeting of minds" ensures enforceability.

4. Contractual capacity  

All parties involved must be legally capable of entering into a contract. This means they must be of legal age and have the mental capacity to understand the terms and implications of the agreement.

5. Legality of purpose  

The contract must be for a lawful purpose. Contracts involving illegal activities are unenforceable.

For a detailed breakdown of contract essentials, check out our guide on the elements of a contract.

Why understanding an express contract matters  

A solid understanding of an express contract helps in drafting agreements that:

• Ensure clarity and certainty by clearly outlining all terms.

• Minimize risks by setting clear expectations and responsibilities.

• Provide legal protection through well-defined clauses that address both anticipated and unforeseen circumstances.  

• Foster long-term partnerships by offering a fair framework for collaboration and conflict resolution.

How does Zoho Contracts help manage express contracts?  

Zoho Contracts streamlines the creation, execution, and management of express contracts with features designed for efficiency and compliance:

• Predefined templates for quick contract drafting.

• Collaborative authoring and approval workflows for real-time edits and seamless contract revisions.

• Online negotiations to finalize contracts effortlessly with counterparties.

• E-signature capabilities to expedite execution and eliminate paperwork delays.

• Obligation management to track deadlines and ensure compliance.

• Advanced analytics to monitor contract performance and glean insights

Zoho Contracts also features an AI assistant powered by ChatGPT, designed to support you at every stage of the contract lifecycle. This includes everything from managing templates to contract creation, reviews, and obligation management. An AI-driven approach for managing express contracts reduces legal dependency, shortens contract cycle times, and enhances compliance.

Try Zoho Contracts for your express contracts today!