Oregon Construction Contractors (CCB) Practice Test

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Which option is a requirement for a valid contract?

  1. Contracts must intend to harm others

  2. Contracts should be possible to perform and legal

  3. Contracts can involve illegal activities if they are beneficial

  4. Contracts may be written without any legal formalities

The correct answer is: Contracts should be possible to perform and legal

A valid contract must be possible to perform and must involve legal activities. This principle ensures that the terms of the contract can be carried out in the real world, meaning that both parties have the capacity to fulfill their obligations. Additionally, the purpose of a contract must be lawful; if a contract involves illegal activities, it cannot be enforced by law, making it void from the outset. When contracts are intended to harm others, are based on illegal activities, or are created without necessary formalities, they do not meet legal standards for validity. Therefore, the requirement that contracts should be possible to perform and legal is critical for ensuring that they are enforceable and serve their intended purpose of benefiting both parties.

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