“The law of contract is concerned with the mechanics involved in and the principles regulating the formation, performance, continuance and discharge of the parties individually created obligations. The essential elements of any contract are:
- (i) offer;
- (ii) acceptance;
- (iii) consideration (not required for contracts underseal);
- (iv) intention to be bound;
- (v) mutuality;
- (vi) capacity; and
- (vii) legality.
The offer and acceptance when taken together would form the “agreement” and that agreement must be supported by consideration in order to establish the obligation. It is the parties that must intend that the agreement to have legal force and the courts will only enforce what the parties intend should be enforced. The parties too must agree on the same thing and this would be known as mutuality. The parties too must have the capacity of reaching a binding agreement and the subject matter of the agreement must be legal. Briefly, these are the seven essential elements that must be present before a contract is said to be in existence.” per Hj Abdul Malik Hj Ishak J (as His Lordship then was) in Sulisen Sdn Bhd v Kerajaan Malaysia [2006] MLJU 341
