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Article 10(1) of the Contract Law provides that:

“Contracts are all agreements which are concluded with the free consent of parties competent to contract, for lawful consideration and a lawful purpose, and which are not declared void by this Law. Subject to the provisions of this Law, contracts may be concluded in writing, or orally, or partly in writing and partly orally, or may be inferred from the conduct of the parties.”

The basic requirements for the formation of a valid contract are as follows:

A promise, which consists of an offer and an acceptance, as those terms are interpreted in Article 2(2) of the Contract Law. For an offer to become a promise, the acceptance must be absolute and unqualified, or made in the usual and reasonable manner, unless the offer simultaneously specifies the manner of acceptance.

Consideration arises when, at the request of the promisor, the promisee or any third party has done, does, or promises to do or to refrain from doing something. That act or abstention is called consideration for the promise. In other words, consideration is the exchange or value, which is an essential element of a contract. Consideration does not need to be adequate, as long as it has some value or consists of the waiver of a right provided by law. In Cyprus, past consideration is regarded as valid consideration. An agreement made without consideration is void unless it falls within one of the exceptions provided in Article 25 or Article 145 of the Law.

The intention to create legal relations is the willingness to form a legal obligation.

Free consent exists when two or more persons agree upon the same thing in the same sense. Consent is considered free when it is not caused by coercion, undue influence, fraud, misrepresentation, or mistake. Where consent is given as a result of any of the above, the contract is voidable at the option of the party whose consent was so obtained. That party may either rescind the contract or insist on its performance and claim damages, or both.

Capacity to contract exists when a person is of sound mind at the time of the conclusion of the contract and is not deprived of the legal ability to enter into a contract.

Remedies

There are essentially three main remedies in the event of breach or non-performance of a contract:

Damages, Specific Performance, Injunction.

Contracts and agreements include, among others: lease agreements, promissory notes, powers of attorney, and various written agreements.

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