Legal Definitions - transaction

In business law, a transaction refers to an event that involves business dealings between two or more parties. This event includes the formation and performance of an obligation or contract. The term transaction is commonly used in real estate and mergers and acquisitions markets.

In civil law, a transaction may refer to an agreement made between two or more parties to prevent or end a dispute that could lead to litigation. This agreement is often written in the form of a contract and is also known as a compromise or settlement.

For example, when a person buys a house, it is considered a transaction between the buyer and the seller. The buyer agrees to pay a certain amount of money, and the seller agrees to transfer ownership of the property. In this case, a contract is formed, and both parties have obligations to fulfill.

Another example is when two parties are involved in a legal dispute, and they decide to settle the matter outside of court. They may reach a transaction where they make reciprocal concessions to end the dispute. This agreement is binding, and both parties must fulfill their obligations as outlined in the contract.

Overall, a transaction is an essential aspect of business and legal dealings, and it involves the formation and performance of obligations or contracts between two or more parties.