Define "mutual assent" in contract law.

"Mutual assent" in contract law refers specifically to the agreement between parties on the terms of a contract, which is demonstrated through the processes of offer and acceptance. This concept is foundational to contract formation, as it establishes that both parties have a shared understanding of the terms and conditions they are agreeing to.

In practical terms, mutual assent occurs when one party makes an offer, and the other party accepts it without any modification or counteroffer. This mutual agreement indicates that both parties consent to be bound by the terms of the contract, thus creating a legally enforceable obligation. The clear demonstration of this agreement is essential, as it confirms that there is a meeting of the minds—a crucial element in establishing a valid contract.

Other choices do not accurately capture the essence of mutual assent. For instance, while the approval of all parties' actions may hint at agreement, it does not necessarily reflect the specific legal context of offer and acceptance. Similarly, the necessity for contracts to be in writing pertains to contract formalities but does not define mutual assent. Additionally, the ability of parties to change their minds speaks to issues of contract modification or termination, rather than the fundamental agreement necessary for a contract's validity.