A contract is a legal agreement which involves an exchange of goods or services for money.
Written and spoken contracts
Contracts can be written or verbal, but a written contract:
- can make it easier to prove the specific terms of the agreement
- is a hard copy so you can prove there was an agreement
- doesn’t rely on someone’s memory of the details.
If you are entering into a verbal contract, always ask for details about:
- what services are being provided
- the costs - eg the price for carpet cleaning a standard size room, ask what is ‘standard’?
Australian Consumer law protects you against unfair contract terms, but you should always:
- read contracts carefully before signing
- keep copies of contracts in a safe place
- say 'no' if you feel pressured to agree to something you aren’t sure about.
You can agree to make changes to a contract but both parties need to agree on the details.
Before entering into a contract
Don’t sign a contract unless you:
- have read it
- understand it
- agree with it.
If you are unsure about part of a contract, get some legal advice before signing. Generally, once all parties sign the contract, it is legally binding.
Breaking a contract
A contract breach happens when someone doesn’t do what they agreed to do: they break the contract. A court can enforce a contract, ordering people to stick to their original agreement. The court could also order people pay compensation to the other party.
Making a consumer complaint
Contact Consumer and Business Services (CBS) for consumer advice. CBS can help if you have a problem with a trader but there are some simple steps you can take before lodging a formal complaint.
Making a consumer complaint offers advice and a checklist to guide you through resolving problems with a trader.
Contact the Legal Services Commission on 1300 366 424 or visit Legal Services Commission of South Australia if you need legal advice about contracts.