Contractual Obligation Definition
A contractual obligation is a legally binding agreement between two or more parties to do, or not do, something. A contract is formed when an offer is accepted. The person making the offer (the offeror) creates an enforceable obligation on themselves by offering something to another person (the offeree). The offeree can accept the offer, which then creates a legally binding contract between the parties.
If you fail to meet your contractual obligations, you may be sued for breach of contract. A court will then order you to do (or not do) whatever you agreed to in the contract. If you still don’t comply, you may be found in contempt of court, which can lead to fines or even jail time.
