The third element of contractual formation is agreement, sometimes called 'consensus ad idem' (a meeting of the minds). For a contract to be formed the parties must reach agreement on all those things without which there cannot be a workable transaction. In addition, the parties must have agreed on any details that either of them has indicated must be agreed on before the contract is completed.

Enough agreement to make the transaction workable is necessary because a court would be unable to enforce an agreement that is insufficiently complete or certain. This is a matter of practicality.

In this section of the eStudy module we consider how to work out whether or not the parties have reached sufficient agreement to be bound.