What is the term for when both parties agree on the essential details of a contract?

The term "meeting of the minds" refers to the mutual agreement between the parties involved in a contract on the essential terms and conditions. This concept is fundamental in contract law, as it signifies that both parties have a shared understanding of the contract's key elements, such as the obligations, rights, and benefits that will flow from the agreement.

When there is a meeting of the minds, it indicates a mutual assent, which is necessary for a contract to be legally binding. Without this agreement on the essential details, there may be a lack of clarity, and the enforceability of the contract could be questioned. This is why establishing a meeting of the minds is crucial when drafting contracts and ensuring that all parties involved have the same expectations and understanding.

In contrast, terms like competent parties, legal purpose, and purchase price refer to other components necessary for a valid contract. Competent parties focus on the legal ability of the individuals entering into the agreement, legal purpose ensures that the contract's intent is lawful, and purchase price specifies the monetary consideration involved in the agreement. While all these elements are important for creating a valid contract, the actual synchronization of understanding on essential details is encapsulated in the phrase "meeting of the minds."