legal sanctity of MOU

Memorandum of understanding is an agreement between two or more parties agreeing upon a same thing in the same sense at the same time. MOU has to be drafted with the necessary pleading of agreement. MOU is the modern name of agreement especially used while making international agreements. Legality of MOU is not depending on its name but on the terms and conditions, place of execution and intention of creators. MOU will be considered as an agreement and it is the question of essential elements in it to consider whether it legally enforceable or not.

MOU is nothing but the common understanding between the parties, before entering into a concrete business relation say contract. It paves the way to a contract and is not a contract itself.

For enforciability in the court of law, it lacks consideration, an indispensable requirement of contracts.

Being a document reduced into writing, can always be called by court to know background of a contract. Further if the contract follwed by a MOU itself forms the MOU a part of the contract, it gains the legal sanctity and becomes enforciable in a court of law.

If someone having varied opinion, please let me know.

Adv Naveen BHardwaj

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