Consensus plays a crucial role in the formation of a valid contract. In the law of contract, consensus refers to the mutual agreement or meeting of the minds between the parties involved in a contract regarding the essential terms of the agreement. For a contract to be legally binding, there must be an offer, acceptance, and consideration. All parties must agree to the terms of the contract, and there must be no coercion or misrepresentation involved.
In other words, a valid contract can only be formed when all parties reach a consensus on the essential terms of the agreement. Once consensus is reached, the terms of the agreement become legally binding, and each party must fulfill their obligations as outlined in the contract. The law of contract ensures that agreements made in good faith are enforced, and parties can seek legal remedies if the terms of the contract are breached.