What is the primary purpose of a signature on a contract?

The primary purpose of a signature on a contract is to indicate formal agreement to the contract terms. A signature symbolizes that the parties involved have understood, accepted, and agreed to the specific provisions outlined in the contract. This acceptance transforms the document from a mere proposal into a legally binding agreement, establishing the parties' intentions to be bound by its terms.

While identifying the parties involved is important, signatures do more than just serve as labels; they demonstrate the parties' consent to enter into the contractual relationship. Creating an official document is a broader concept that encompasses more than just a signature; it involves the entirety of the contract's formatting and presentation. Notarization, while relevant in certain contexts, is not a primary function of a signature. A signature suffices to create a binding intention, regardless of whether the document is notarized. Therefore, the focus on consent and agreement illustrates why indicating formal agreement is the fundamental purpose of a signature on a contract.