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Exploring the Legal Definition of Contract Under Seal
Definition & Meaning
A contract under seal, also known as a sealed contract or deed, is a formal agreement that does not require consideration to be legally binding. This type of contract must be in writing and includes a seal affixed by the signer. Once signed, sealed, and delivered, it becomes conclusive between the parties involved. Delivery can occur by physically handing the document to the other party or by expressing an intention for the contract to take effect, even if it remains with the signer. Unlike ordinary contracts, the validity of a contract under seal is derived solely from its formal execution rather than mutual agreement or consideration.
Table of content
Legal Use & context
Contracts under seal are primarily used in civil law contexts. They are often employed in real estate transactions, wills, and certain business agreements. Because they do not require consideration, they can serve specific purposes where traditional contracts may not be suitable. Users can manage these contracts using legal templates available through services like US Legal Forms, which provide professionally drafted documents to ensure compliance with state laws.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A property owner signs a deed to transfer ownership of real estate to a buyer. The deed is sealed and delivered, making the transfer legally binding without requiring any payment at that moment.
Example 2: A parent executes a sealed document to establish a trust for their child, ensuring that the trust is recognized without the need for consideration. (hypothetical example)
State-by-state differences
Examples of state differences (not exhaustive):
State
Notes
California
Recognizes sealed contracts but may have specific requirements for certain types.
New York
Sealed contracts are enforceable without consideration but must meet formal execution standards.
Texas
Allows for sealed contracts, but the seal's effect may vary based on the contract type.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Key Differences
Contract
An agreement between parties that creates mutual obligations.
Requires consideration to be enforceable.
Deed
A legal document that conveys property or rights.
Often requires a seal and does not need consideration.
Covenant
A formal agreement or promise in a contract.
May or may not be under seal; often involves specific performance.
Common misunderstandings
What to do if this term applies to you
If you are involved in a situation where a contract under seal applies, consider the following steps:
Ensure the document is properly drafted and includes all necessary elements, such as signatures and seals.
Use legal templates from US Legal Forms to create or review your contract.
If the situation is complex, consult a legal professional for tailored advice.
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