Enforceability Of Memorandum Of Agreement

Although there are obvious theoretical differences between a contract and a memorandum of understanding, the practical differences between these two agreements may be limited by the intention of the party. An agreement becomes enforceable if there is evidence that the parties intend to create a legally binding agreement. This can be as minor a problem as changing a budget item (for which you may already have a procedure in the contract – see above) or as important as changing the entire content of the activity that the contract covers. In general, these changes should require the agreement of both parties and some negotiations should probably be integrated. For example, if an organization agreed, at the request of a funder, to act as a transfer of money to another organization that had not yet received its federal tax-exempt classification. The first organization would simply ask the funder for money at reasonable intervals and give it to the second. . . .

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