Step-by-step explanation:
A contract is a legally binding agreement between two or more parties that outlines the terms and conditions of their agreement. Contracts can be written or verbal, and they are used in a wide variety of situations, including business transactions, employment agreements, and real estate deals.
The objective theory of contracts is a legal doctrine that determines the validity of a contract based on the objective intentions of the parties involved. According to this theory, a contract is formed when the parties involved manifest their intent to be bound by the terms of the agreement, and their intentions are objectively reasonable under the circumstances.
Under the objective theory of contracts, the court will consider the words and actions of the parties to determine their intent, rather than their subjective beliefs or intentions. This means that even if one party claims they did not intend to be bound by the terms of the agreement, the court will look at their actions and words to determine whether they objectively appeared to intend to be bound.
Overall, the objective theory of contracts is an important principle in contract law because it helps to ensure that contracts are enforceable and that parties are held accountable for the promises they make.