Leasing License Practice Exam

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The element of legal purpose in a contract can also be referred to as what?

Legitimacy of actions
Legality of object
Contractual validity
Legal agreement

The correct answer is: Legality of object

The concept of legal purpose in a contract refers to the necessity that the subject matter of the contract must be legal. This is often referred to as "legality of object." A contract cannot be enforced if its purpose involves illegal activities or is against public policy. For a contract to be deemed valid, it must have a lawful objective that aligns with legal statutes, ensuring that the obligations and agreements made are permissible under the law. In this context, "legality of object" effectively encapsulates the requirement that the terms of the contract must involve legal objectives. This ensures that the contract is aimed at promoting lawful actions and does not lead to any legal consequences for the parties involved. Other terms like "legitimacy of actions," "contractual validity," and "legal agreement" may touch upon aspects of contracts, but they do not specifically pinpoint the necessity for the purpose or object of the contract to be legal. Therefore, the focus on legality of object distinctly aligns with the element of legal purpose.