What is the term for a formal or legally binding agreement between two or more parties?

The term that represents a formal or legally binding agreement between two or more parties is known as a "contract." A contract establishes the terms and conditions that the parties involved are obligated to follow. It typically requires an offer, acceptance, consideration (something of value exchanged), and the intention to create legal relations. Contracts can cover a wide range of situations, including business transactions, employment relationships, and service agreements, making them fundamental to legal and business operations.

While the options 'agreement' and 'accord' may seem similar, they lack the legal enforceability that a contract holds. An 'agreement' is a broader term that refers to any understanding between parties, but not all agreements are legally binding. An 'accord' typically refers to an agreement to settle a dispute or to modify a previous contract but does not inherently signify that it is legally binding without the conditions of a contract being met. An 'affidavit' is a sworn written statement that is used primarily in legal proceedings rather than an agreement between parties. This distinction reaffirms that the most precise term for a formal, legally binding agreement is a contract.