When operating a company or home business it is vital to have agreements and do the legal aspects of the business correctly. Legal problems are very stressful and difficult to deal with. If an individual gets involved with a legal issues, it helps to understand the lingo being bandied about. Legal agreements and Contracts: An agreement between two or more parties in which each party agrees to provide something in exchange for the other party doing the same. Typically, one side provides money while the other provides a service or product. Contracts can be oral or written, but oral contracts are hard to enforce.