Written and unwritten contracts are essential parts of the Thai legal system and form the basis of many of our personal and business transactions. To protect yourself, especially when money is involved, and to avoid legal entanglements, a basic understanding of contracts is essential. There is no definition of “Contracts” in the Thai Civil Code. However let’s say that you have an offer which clearly indicates to someone else your intention to enter into a contract. If your offer is accepted voluntarily, then you’ve got an acceptance and the offer becomes a contracts. Contracts are voluntary, legally binding agreements between two or more people to do or not do something. Whether you realize it or not, you enter into contracts all the time: when you borrow money from a bank, get married or divorced, buy a car, buy your meals and so on.
The best contract is always a written one in which all the things that have been agreed - the terms of the contract - are spelled out, in writing. Terms usually include the following:
- Who’s obligated to do what and for how much
- Applicable deadlines
- Answers to questions such as “what happens if…?”
Fill-in-the-blank contracts are only appropriate for very straightforward agreements; they’re not a good idea if your agreement must address unusual or special situations or concerns.
What if I want out?
A contract can be broken under certain conditions, which include the following:
- You are defrauded by another party to the contract.
- One party to the contract breaches the contract.
- You sign the contract because you’re being threatened.
- You and the other parties to the contract agree to cancel it.
If the contract is important and you want to minimize the potential for problems with it later, ask lawyers to review the contract before you sign it. Lawyers can point out any weaknesses in the contract and suggest changes to give you more legal protection.