A contract requires that the parties intend to enter into a legally binding agreement. That is, the parties entering into the contract must intend to create legal relations and must understand that the agreement can be enforced by law. The intention to create legal relations is presumed, so it is not necessary for the contract to expressly state that you understand and contemplate the legal consequences that will result. Stan insists that the $100.00 was a deposit on the car and was supposed to be part of the contract to purchase the car. Stan is very persistent and insists that Jim and Laura signed a contract to buy the car; therefore, the $100.00 will be applied to the purchase price of the car. Consideration is an essential element of any valid contract. The consideration consists either of an advantage for the promisor or of a detriment to the promisee. It is a present exchange negotiated in exchange for a promise. It is not necessary for a contract to be supported by monetary consideration. Consideration is what each party gives to the other as an agreed price for the other's promises. Usually, the consideration is the payment of a sum of money, but this is not obligatory; it can be anything of value, including a promise not to do something or to refrain from certain activities.