Which statement best describes a contract?

A contract is fundamentally understood as an intangible agreement between parties that creates obligations and rights that can be enforced by law. This means that a contract exists once the parties involved mutually agree to the terms, regardless of whether it is documented in writing or spoken aloud. The essence of a contract is the intention to create a legal relationship and the certainty of the agreement's terms.

While having a written agreement is often beneficial for clarity and enforceability, it is not a requirement for a contract to be valid. Many contracts can be legally binding based on verbal agreements or even implied agreements derived from the conduct of the parties involved. Therefore, Option B accurately captures this definition of a contract as it emphasizes the essence of the agreement rather than its formality.

Other options, such as the need for written documents, government filing, or specific conditions like witnesses, introduce conditions that are not universally applicable to all contracts, since many valid contracts can exist without these elements.