What constitutes a valid contract under Canadian law?

A valid contract under Canadian law is established when four essential elements are present: offer, acceptance, consideration, and the intention to create legal relations.

The offer is a clear proposal made by one party to another, indicating the terms on which they are willing to agree. Acceptance occurs when the other party agrees to those terms. Consideration refers to something of value that is exchanged between the parties, which can be in the form of money, services, or goods. Lastly, the intention to create legal relations means that both parties must intend for their agreement to be legally binding; this is an important distinction to ensure that not all agreements lead to legal obligations.

This combination and balance of elements ensure that the contract is legally enforceable and that both parties have a clear understanding of their respective rights and obligations. Other options may list components of a contract but miss critical elements that define a binding agreement under Canadian law, such as the requirement for intention to create legal relations.