What is a necessary requirement for parties entering into a contract?

For parties entering into a contract, one of the fundamental requirements is that they must be of sound mind. This means that both parties must possess the mental capacity to understand the nature and consequences of the contract they are entering into. Specifically, they should be able to comprehend the terms, obligations, and potential repercussions of the agreement.

When one or more parties lack sound mind—either due to mental illness, incapacity, intoxication, or other reasons—their ability to agree to the contract is impaired, which can render the contract void or voidable. This principle is crucial because it helps ensure that contracts are formed between individuals who can make informed decisions.

In contrast, the other options present requirements that are not universally applicable: age limits vary by jurisdiction, wealth is not a criterion for contract validity, and while some contracts do need to be in writing (like those involving real estate), not all contracts require this formality to be enforceable. Therefore, the stipulation that parties must be of sound mind represents a core principle of contract law that upholds the integrity of agreements between parties.