The agreement consists of a proposal that must be accepted by the party to which the proposal is submitted and, if that proposal is adopted, it will become a promise of the parties on which they have agreed. The parties have the right to be brought to justice in the event of non-compliance with the contract. In the UK, the term MoU is often used to refer to an agreement between certain parts of The Crown. This term is often used in the context of decentralisation, for example in the 1999 Concordat between the Central Ministry for Environment, Food and Rural Affairs and the Scottish Environment Directorate. A Memorandum of Understanding (MOA) or cooperation agreement is a written document between the parties to work together on an agreed project or achieve an agreed goal. The purpose of a MOA is to have a written understanding of the agreement between the parties. The MOA can also be legally valid and make the parties responsible for their commitment, or only a partnership contract. Both documents likely identify all the conditions that need to be resolved before the deal closes. The document also deals, as a rule, with the deadlines and deadlines for the transaction, the price and the method of payment. Other aspects that may be included in the Memorandum of Understanding or Memorandum of Understanding are guarantees relating to negotiable instruments, a list of total liabilities and total assets, and the operating condition of all appliances and machinery at the time of purchase.

Although MOs are rarely visible in the multilateral field, transnational air agreements are in fact soft. In Ashapura Mine-Chem Ltd v. Gujarat Mineral Development Corporation, the Supreme Court of India (“Supreme Court”) considered the issue of the severability and survival of an arbitration clause contained in a Memorandum of Understanding (“MoU”). The Supreme Court ruled that the arbitration agreement was valid to the extent that it was a separate agreement, independent of its underlying contract. The Supreme Court relied on several judgments, including Reva Electric Car Co. Pvt Ltd v Green Mobil 2002 (2) SCC 93 and Today Homes and Infrastructure Pvt. Ltd v Ludhiana Improvement Trust 2014 (5) SCC 68 and Enercon v Enercon 2014 (5) SCC 1, the dispute between the parties concerns the relationship created by Protocol D, so that the arbitration agreement it contains would read the parties. A Memorandum of Understanding (MOU) is an agreement between two or more parties that sets out the terms and details of an agreement, including the requirements and responsibilities of each party. This is often the first step in forming a formal contract and does not include the exchange of money. 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.

Courts may also decide that the parties intend to enforce only a few parts of a memorandum of understanding. This is illustrated in a case recently decided by the Ontario Superior Court of Justice. In Georgian Windpower Corporation et al.v. Stelco Inc., the parties have entered into a two-year Memorandum of Understanding. However, the contract was terminated by the defendant before the expiry of the two-year period. The court awarded the plaintiff damages for the unlawful termination of some but not all of the contractual terms. On the other hand, a contract can be defined as an exchange of relationships created by a verbal or written agreement between two or more persons who have at least one commitment and who are recognized as enforceable by law. .