Further, all such contracts, as well as formal agreements, are preceded by a Memorandum of Understanding Registration in India. A Memorandum of Understanding documents the relationship between the parties. Despite the fact that the parties have no obligation under this contract, it will serve as a means of establishing a relationship between the parties that is significant enough to occur in the future, i.e., to eventually allow them to sign a formal contract together.
MEMORANDUM OF UNDERSTANDING
There are several types of Memoranda of Understandings, but an MOU tends to be more widely known as it facilitates the creation of an agreement between two or more parties, it is important to realize that if both parties wish to resign, they must establish a definite action plan in order to create a successful and clear agreement that puts aside both the rights and the obligations of all parties. This is a formal contract between the parties, and it is a legal contract, but it is not legally binding in any way to them. An MOU between the parties should clearly state the names of all the parties, specify the object and purpose of the agreement, as well as summarize all its important terms and conditions, in order to be legally operative. It is usually less time-consuming to draft a Memorandum of Understanding and since it is not legally binding, it avoids the legal implications altogether, so it is usually preferable to signing a contract. This has a lot to do with the fact that a legal agreement between parties contains an understanding that involves the assumption of the risks, warranties, and indemnifications involved due to the nature of a contract involving the exchange of money and real estate. A Registration of MoU, on the other hand, acts as a non-binding agreement that recognizes the effective negotiations between the parties in the pursuit of achieving a common goal.
Legal Position of MOU In Indian Law
Now we understand, as mentioned above, that it is not necessary for the registration of mou in India to be non-binding. The question of whether such an MOU is legally binding or not depends upon the intent of the parties to create a legal relationship to that extent.
So, it is possible to state that the legal standing of a memorandum of understanding in Indian Law will depend on the intent behind its creation, and so, an intention to create a legal relationship through an MOU plays a deciding factor in determining the importance and the legal role of such a document.
MEMORANDUM OF UNDERSTANDING CHARACTERISTICS
- In order to prove that a memorandum of understanding can be considered legally enforceable, it must contain a legal obligation, and it must include a legal right, so it must meet the essentials of a contract.
- Conditions: Some terms and conditions in the memorandum of association are mutually agreed upon between the parties. This will help provide certainty for the parties in case of a dispute.
- FUTURE FOCUSED: In some MOUs, the terms and conditions regarding the future business plans are already included, so you can plan in accordance with the terms and conditions contained in the MOU.
- A SMALL PROCEDURE: Drafting a Memorandum of Understanding is a very simple and short procedure, as it does not require the permission of any authorities or anyone else besides the parties themselves.
- Basics: Name and other details of the parties to the memorandum of understanding should be included.
- Aim: The purpose of the memorandum should be clarified, as well as the objectives, for which it is being prepared.
- Control should be provided. This memorandum should include a provision for the appointment of persons who will be primarily responsible for the running of the program on a daily basis. There should be mention of the job description, the responsibilities, as well as the remuneration of the employee.
- This memorandum should specify the length of such an agreement, i.e. when it started and when it ended. It should also be clear what consequences should be involved in such a memorandum is terminated.
MOUs are agreements
It is important to recognize that although the memorandum of understanding is not a legally enforceable contract, it is nevertheless a document that holds the power and importance to hold the parties together accountable in achieving the objectives and achieving the goals which are set on the memorandum of understanding. By such a petition we are showing the intentions or the interests of the involved parties to stay binding and continue to follow the terms and conditions laid down in the contract.
Having taken into consideration section 10 of the Indian Contract Act, which, assuming applicable laws are applicable in the country of India, we can use as our template as this section of law sets out certain minimum requirements that should be satisfied in the writing of any legal document including:
- At the beginning of the process, one of the main things is to make an offer, and the other party must accept it or accept it back by the offeror
- The consent expressed by all parties should be free from any push or coercion by any party involved, or any use of undue pressure by any party.