When it comes to the legal system, it is important to understand the different types of laws that exist to ensure businesses and individuals are acting within legal boundaries. Two common types of law that may come into play in contractual agreements are common law and contract law.

Common law refers to legal principles that have been established over time through court decisions and are not explicitly written into legislation. This type of law is typically based on precedent and is used to interpret statutes and written laws. Common law is also known as case law, and its primary purpose is to ensure fairness and consistency in legal decisions and outcomes.

Contract law is a set of rules and regulations that govern the creation, interpretation, and enforcement of agreements between parties. This type of law is essential in business as it establishes the legal framework for agreements and ensures that both parties hold up their end of the deal. Contract law defines the agreements between parties and helps regulate the expectations of parties involved in the contract.

The major difference between common law and contract law is that common law is based on judicial decisions, whereas contract law is based on agreements made between parties. Common law applies when there is no existing contract or when the contract is ambiguous or incomplete. Contract law, on the other hand, is used to govern agreements entered into by parties and is legally binding.

One way to understand the difference between these two types of law is to consider an example. If someone were to sue a business for negligence and breach of contract, the common law would be relevant for the negligence claim, while the contract law would be relevant for the breach of contract claim.

In conclusion, understanding the difference between common law and contract law is important for anyone involved in legal matters. While common law is based on precedent and judicial decisions, contract law is based on agreements entered into by parties. By knowing the key differences between these two types of law, individuals and businesses can be prepared for legal matters, ensuring that they act within legal boundaries and protect their interests.