Just FYI, handshake deals can be valid contracts if certain requirements are met. For one thing, there needs to be enough specificity around the material deal points. Even if you have a written contract but you haven't agreed on the material deal points (for fundraising, this would be things like valuation, type of shares, number of shares/percent of company) then you don't have a valid contract.
There are some things that are on the fence in terms of materiality. For example, is the valuation pre- or post-money? Is there an option pool set aside?
Lastly, there are some types of agreements that cannot be done just on a handshake — there has to be a written agreement in order to be enforceable. IIRC from my law school days, this includes the sale of real estate and a contract that, by its terms, cannot be completed in a year. The latter excludes things that are known to take more than a year, like building a skyscraper. It would include "pet-sit my dog for 13 months while I'm vacationing", for example.
That's a bid mind boggling for me. Let's say we have a contract. You break it. So I'm not happy, I suppose I take you to the court.
And there, something is enforced that is not the law but where you are lawfully obliged to a sanction afterwards ?
I don't really understand why you'd say that ? Isn't the law kind of saying "you shall not break contracts" ? And if it's not, what's the point of a contract ?
My comment was typed quickly and was pretty non-specific, so I'm sorry about that and I probably deserved the downvotes. However, I maintain that under most people's understanding of the terms "breaking a contract" and "illegal", breaking a contract is not illegal.
Regarding "breaking a contract": Contracts often stipulate penalties for non-performance of terms within them. For example, you contract with me to rent my house for 5 years. The contract stipulates that if you leave early, I am entitled to keep the deposit. In common language, people will refer to leaving early as "breaking the contract", but there is nothing illegal about doing so.
Regarding "illegal": If the contract does not specify some penalty for non-performance of a clause, or it does specify one but you somehow avoid the penalty, then it would become a matter for the courts, but importantly, it would be a civil court, not a criminal court. You have not broken a law, you have broken a contract, and the civil courts will determine how this situation will be made right.
