Contracts are legally-binding agreements, meaning that you must fulfil the terms of the contract otherwise legal action may be taken against you.

It is important to understand what the terms and conditions of a contract are before you sign it. If you cannot make the payments or fulfil the conditions, the company you are in contract with can take legal action against you. If it is a payment contract for services for a defined length of time (for instance, a 12-month mobile ‘phone contract), they can take you to court to get the outstanding money if you break the terms of the contract (i.e. you haven’t paid when you should have).

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  • Signing contracts @ Direct.Gov

    Excerpt: Sometimes when you buy a service or an item you enter into a contract with the trader (the supplier providing the service or item). For example, you may have a contract with your mobile phone supplier or a builder for home repairs. Once you’ve signed a contract with a trader, you usually have to follow the contract’s terms and conditions. If you don’t, the trader could take you to court. Before you sign a contract make sure you understand the terms and conditions within it. Terms and conditions should be: written clearly, easy to understand, and fair to both you and the trader – they should protect the trader and the consumer rights you have by law.