Which term defines a legal agreement that creates an obligation between parties?

The term that defines a legal agreement that creates an obligation between parties is a contract. A contract is a formal, legally binding agreement that outlines the rights and responsibilities of the involved parties. It is established when there is an offer, acceptance, and consideration (something of value exchanged). Contracts can cover a broad range of agreements, from employment terms to service agreements, and they help ensure that all parties adhere to their commitments.

Other terms such as a will, deed, and covenant are related to legal agreements but serve different purposes. A will pertains to the distribution of a person's assets after their death. A deed represents the legal transfer of property ownership. A covenant typically refers to a promise in a legal document, often associated with property agreements, but it does not always imply a mutual obligation like a contract does. Therefore, "contract" is the most comprehensive term for a legal agreement that creates obligations among parties.