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Signing contracts: How it works and how to do it.

Understand what it means to sign on the dotted line and how to do it efficiently, whether you’re hiring a new team member or selling a car.

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Why do you need a contract?

Verbal contracts are difficult to enforce. A written contract makes your rights and obligations explicit and the terms of a deal clear. If parties don’t have a written copy of the agreement, it can be difficult to tell if it gets broken. While some regions enforce verbal agreements, it’s better to get everything in writing.

What does it mean to sign a binding contract?

A contract is a legally binding agreement between two or more parties. Contracts explain the obligations of signatories (the people signing contracts) and also state what happens when they don’t meet the contract’s agreements. Contract law provides the umbrella that covers the terms of potential legal disputes and usually provides some kind of remedy to the harmed party. This often, but not always, means monetary damages the party that breached the contract must pay.

You need to create a contract for almost any kind of business agreement, whether you’re contracting for a single job or brokering a major intellectual property deal. If necessary, get legal advice to determine whether or not a contract truly benefits you or your organization.

An example of a contract document on a laptop. At the bottom of the contract is a space to sign electronically using Adobe Acrobat Sign. An example e-signature is shown.

Start signing contracts quickly with electronic signatures.

Signing contracts used to require in-person, physical signatures from all parties. This is not the case anymore. The vast majority of countries around the world now recognize electronic signatures as a valid way to sign an agreement. In the United States, digital signatures are legal everywhere federal law applies thanks to the Electronic Signatures in Global and National Commerce (ESIGN) Act and the Uniform Electronic Transactions (UETA) Act.

In the European Union, the Electronic Identification, Authentication, and Trust Services Regulation (eIDAS) governs digital signature law. Other laws around the globe vary slightly, but Acrobat Sign is compliant with all major laws and regulations in mind.

E-sign easily with Acrobat Sign.

Acrobat Sign has everything you need to seal the deal with e-signatures, whether you’re signing a major business deal or a routine employment contract. E-signatures are fast, legal, and the new standard of doing business across the globe.

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6 elements of the contract signing process.

Individual contracts vary in length, complexity, and particular terms. However, there are six essential elements of a contract that you should always check for:

1. Offer

Every contract starts with the wants or needs from one or more parties and the responsibilities to fulfill those wants or needs by another party. This initial statement of what parties want and what they have to give is known as an offer.

2. Acceptance

In some contracts, once an offer is presented, a party can decide to accept or reject it. Acceptance can be conditional or contingent on other factors.

3. Awareness

All parties to a contract know about the agreement that they’re entering into. Ideally everyone involved is an active participant taking part freely and without coercion.

4. Consideration

Contracts have to include the value of what’s agreed upon, like a product, property, or service. There doesn’t necessarily need to be a monetary amount attached to what’s being discussed. What’s important is that all parties acknowledge that the thing or service has an agreed-upon value.

5. Capacity

People need to understand what they’re agreeing to when they sign a contract. What’s more, people can’t sign away their legal rights. Everyone signing contracts needs to understand the terms of the agreement and be of sound mind. Parties who are forced to sign a contract against their will, or not able to understand what the contract means, do not have the capacity to be a signatory.

6. Legality

Contracts work because they have the force of law behind them. Contracts are subject to the laws and regulations of whatever jurisdiction they operate in, and have to obey applicable federal and state laws. So, it’s impossible to create a valid contract for illegal activity.

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Check out these electronic contract-signing success stories.

Switching to e-signatures for contracts gets the deal done faster and makes things easier for everyone.

Connecting people to housing faster.

Founded in 2018, Platform Housing Group is a not-for-profit UK organization that values getting people into homes quickly. Contracts and paperwork can be a major bottleneck in the home-buying process, but Platform sped up the process with Acrobat Sign, saving three hours per agreement that, in time, added up to more than £86,000 in savings in under a year.

Going digital with CarMax.

Over 25 years, CarMax weathered the transition from a paper-based world to a digital one. But the company wanted to simplify and speed up the car-buying process, and make things easier for customers and store associates alike. By adopting e-signatures, the company was able to better provide home-delivered and curbside pickup of vehicles, and reduce errors and completion time in their workflows.

Avoid the hassle of having to deal with paper documents, and make your written agreements easier and more efficient for everyone with Acrobat Sign.