All agreements are not contracts. A contract creates enforceable obligations. Contracts can be express (written or oral) or tacit. By law certain contracts must be in writing. For a contract to be considered valid and binding there must be ‘consensus ad idem’ (meeting of minds) between the contracting parties, a serious intention for the agreement to result in terms which can be enforced, the parties must have the capacity to contract, the agreement must have certain and definite terms, the necessary formalities must be observed, the agreement must be lawful, the contractual obligations must be possible of performance and the content of the agreement must be certain.