Definition: An executed contract is an agreement or contract between two or more parties that has been signed and is binding to all parties involved. It is a fully implemented contract.
What Does Executed Contract Mean?
Executed contracts are easy to identify in real life. A person agreeing to pay for a particular service or participating in it, either by signing a physical or an online contract, is in a situation where an executed contract is created. By agreeing to the terms of the document, whether it is implied or it is explicitly agreed upon, the contract is executed accordingly. Also, the term applies to a contract that has been completely fulfilled and it has come to a conclusion.
This is the case, for example, of lease contracts. After a given period has elapsed, the contract is already fully executed and the contractual relationship ends at that moment. The execution date is the exact day when the contract was signed by the parties. This date might be different from the effective date, which is the day where the action or purpose of the contract actually takes place.
Example
A domestic services company called All Fixers Co. is currently disputing with a customer the terms of a previously signed contract. Mr. Fergusson is the person affected by the conflict and his argument is that All Fixers stated that a given electric maintenance service will be completed by February 2. The service agreement was signed in January 28 and the agreement clearly states that the service will be executed in February 1.
Nevertheless, the contract doesn’t state how long it will take for the service to be fully executed. It just states the date of the signature and the date of execution. Mr. Fergusson’s lawyer reviewed the agreement and concluded that it is an executed contract, since both parties signed and agreed on it. He also identified that the execution date was January 28 and the effective date was February 1. Since the contract doesn’t state when the service will be fully completed, Mr. Fergusson complain doesn’t have a legal basis. That means he has to wait until the service can be finished.
