1.
the concept of the two
contract: in practice, a contract can appear under different names, such as contract, contract, agreement, agreement, memorandum and contract.
Article 2 of the Contract Law defines a contract as "an agreement between natural persons, legal persons and other organizations with equal subjects to establish, change and terminate the relationship of civil rights and obligations". It can be seen that a contract is an agreement with specific contents, which is used to stipulate the rights and obligations between the parties. An agreement that also has the above characteristics is a contract. The name is not important, the key is to look at its content.
Letter of Intent: A letter of intent is a written document signed by both parties through preliminary negotiation, which is the basis for substantive negotiations between the two parties and the prelude to signing an agreement (contract).
II.
Differences between the two
1.
Different contents
The content of a contract is the civil rights and obligations between the parties to the contract, while the content of a letter of intent is only the unanimous determination of the parties to the contract on a certain matter, not the civil rights and obligations between the two parties.
2.
Signing time
The signing time of the contract is after the two parties reach an agreement on the rights and obligations, and the letter of intent can be signed after the two parties reach an understanding on a certain matter.
3.
Legal Consequences
The signing of a contract will have legal effect and be binding on the signatory, while the signing of a letter of intent will not have legal effect and has no binding force on the signatory. However, some letters of intent have the content of the legal rights and obligations between the contracting parties, so they are legally binding on the contracting parties. In fact, they already belong to the contract, but with different names. Therefore, the letter of intent cannot be regarded as legally binding or not unilaterally. The key is to see whether its content has the content of the contract.
III.
The connection between the two
Signing a letter of intent is the basis for signing a contract, but not all contracts must be signed with a letter of intent. The signing of the letter of intent is for the parties to the contract to reach a smooth agreement on their rights and obligations, and for the smooth signing of the contract. The contract is often signed on the basis of the content of the letter of intent, so the content of the letter of intent often affects the content of the contract.
IV.
Significance of the difference between the two
1.
Understanding the difference between the two can guide us to correctly choose the usage of the two in practice;
2.
Knowing the difference between them can help us to correctly understand the legal consequences of signing them.
Summary:
The key to the difference between a contract letter of intent and a contract is whether it contains the rights and obligations of both parties, not just the name. Some contract letters of intent fully contain the contract contents, so this contract letter of intent has legal effect.