Title 9, Contracts and Obligations

The object of a contract is the thing which it is agreed on the part of the party receiving the consideration to do or not to do.

The object of a contract must be lawful when the contract is made and possible and ascertainable by the time the contract is to be performed. Everything is deemed possible except that which is impossible in the nature of things.

When a contract has but a single object, and such object is unlawful in whole or in part, or wholly impossible of performance, or so vaguely expressed as to be wholly unascertainable, the entire contract is void.

When a contract has several distinct objects, of which one at least is lawful and one at least is unlawful in whole or in part, the contract is void as to the latter and valid as to the rest.

Any benefit conferred or agreed to be conferred upon the promisor by any other person to which the promisor is not entitled lawfully, or any prejudice suffered or agreed to be suffered by such person, other than such as that person, at the time of consent, is lawfully bound to su…

An existing legal obligation resting upon the promisor, or a moral obligation originating in some benefit conferred upon the promisor or prejudice suffered by the promisee, also is a good consideration for a promise to an extent corresponding with the extent of the obligation, bu…

The consideration of a contract must be lawful within the meaning of section 9-08-01.

If any part of a single consideration for one or more objects, or of several considerations for a single object, is unlawful, the entire contract is void.

A consideration may be executed or executory in whole or in part. Insofar as it is executory, it is subject to the provisions of chapter 9-04 relating to the object of a contract.

When a consideration is executory, it is not indispensable that the contract should specify its amount or the means of ascertaining it. It may be left to the decision of a third person or regulated by any specified standard.

When a contract does not determine the amount of the consideration nor the method by which it is to be ascertained, or when it leaves the amount thereof to the discretion of an interested party, the consideration must be so much money as the object of the contract reasonably is w…

When a contract provides an exclusive method by which its consideration is to be ascertained, and such method is on its face impossible of execution, the entire contract is void.

When a contract provides an exclusive method by which its consideration is to be ascertained, and such method appears possible on its face, but in fact is or becomes impossible of execution, such provision only is void.

A written instrument is presumptive evidence of a consideration.

The burden of showing a want of consideration sufficient to support an instrument lies with the party seeking to invalidate or avoid it.

A contract is either express or implied. An express contract is one the terms of which are stated in words. An implied contract is one the existence and terms of which are manifested by conduct.

All contracts may be oral except such as are specially required by statute to be in writing.

When a contract which is required by law to be in writing is prevented from being put into writing by the fraud of a party thereto, any other party who by such fraud is led to believe that it is in writing and acts upon such belief to that party's prejudice may enforce it against…

The following contracts are invalid, unless the same or some note or memorandum thereof is in writing and subscribed by the party to be charged, or by the party's agent: 1. An agreement that by its terms is not to be performed within a year from the making thereof. 2. A special p…

When a sale of any goods or choses in action is made by auction, an entry by the auctioneer in the auctioneer's salebook at the time of the sale of the kind of property sold, the terms of sale, the price, and names of the purchaser and person on whose account the sale is made is …

The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the oral negotiations or stipulations concerning its matter which preceded or accompanied the execution of the instrument.

A contract in writing takes effect upon its delivery to the party in whose favor it is made or to that party's agent.

The provisions of the laws of this state concerning the delivery of grants, absolute and conditional, apply to all written contracts.

All distinctions between sealed and unsealed instruments are abolished.

All contracts, whether public or private, are to be interpreted by the same rules, except as otherwise provided by the laws of this state.

The language of a contract is to govern its interpretation if the language is clear and explicit and does not involve an absurdity.

A contract must be so interpreted as to give effect to the mutual intention of the parties as it existed at the time of contracting so far as the same is ascertainable and lawful. For the purpose of ascertaining the intention of the parties to a contract, if otherwise doubtful, t…

When a contract is reduced to writing, the intention of the parties is to be ascertained from the writing alone if possible, subject, however, to the other provisions of this chapter.

When through fraud, mistake, or accident a written contract fails to express the real intention of the parties, such intention is to be regarded and the erroneous parts of the writing disregarded.

The whole of a contract is to be taken together so as to give effect to every part if reasonably practicable. Each clause is to help interpret the others.

Several contracts relating to the same matters between the same parties and made as parts of substantially one transaction are to be taken together.

A contract must receive such an interpretation as will make it lawful, operative, definite, reasonable, and capable of being carried into effect, if it can be done without violating the intention of the parties.

The words of a contract are to be understood in their ordinary and popular sense rather than according to their strict legal meaning, unless used by the parties in a technical sense, or unless a special meaning is given to them by usage, in which case the latter must be followed.

Technical words are to be interpreted as usually understood by persons in the profession or business to which they relate, unless clearly used in a different sense.

A contract may be explained by reference to the circumstances under which it was made and the matter to which it relates.

However broad may be the terms of a contract, it extends only to those things concerning which it appears that the parties intended to contract.

If the terms of a promise in any respect are ambiguous or uncertain, it must be interpreted in the sense in which the promisor believed at the time of making it that the promisee understood it.

Particular clauses of a contract are subordinate to its general intent.

When a contract is partly written and partly printed, or when part of it is written or printed under the special directions of the parties and with a special view to their intention and the remainder is copied from a form originally prepared without special reference to the parti…

Repugnancy in a contract must be reconciled, if possible, by such an interpretation as will give some effect to the repugnant clause subordinate to the general intent and purposes of the whole contract.

Words in a contract which are inconsistent with its nature or with the main intention of the parties are to be rejected.

In cases of uncertainty not removed by the preceding rules, the language of a contract should be interpreted most strongly against the party who caused the uncertainty to exist. The promisor is presumed to be such party, except in a contract between a public officer or body, as s…

Stipulations which are necessary to make a contract reasonable or conformable to usage are implied in respect to matters concerning which the contract manifests no contrary intention.

All things that in law or usage are considered as incidental to a contract or as necessary to carry it into effect are implied therefrom, unless some of them are mentioned expressly therein. In such case, all other things of the same class are deemed to be excluded.

If no time is specified for the performance of an act required to be performed, a reasonable time is allowed. If the act in its nature is capable of being done instantly, as for example if it consists in the payment of money only, it must be performed immediately upon the thing t…

Time is of the essence of a contract if it is provided expressly by the terms of the contract or if such was the intention of the parties as disclosed thereby.

Any provision of a contract is unlawful if it is: 1. Contrary to an express provision of law; 2. Contrary to the policy of express law, though not expressly prohibited; or 3. Otherwise contrary to good morals.

All contracts which have for their object, directly or indirectly, the exempting of anyone from responsibility for that person's own fraud or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.

Any provision in a construction contract which would make the contractor liable for the errors or omissions of the owner or the owner's agents in the plans and specifications of such contract is against public policy and void.

Penalties imposed by contract for any nonperformance thereof are void.