Although the idea of a contract in real life is ostensibly meant to protect both parties’ interests and hold both parties accountable, this is almost never the case in fiction. When a contract shows up, you know it’s bad news, and if it’s a magical contract, just, like, don’t even read it. Instead of reading it, run.
In day to day life, dealing with the fine print of agreements ranges from irrelevant to frustrating—maybe the paid membership you signed up for auto-renews and you didn’t realize it, or you agreed to an EULA that said you promised not to use that software to create nuclear weapons. Generally a bummer, but nothing life-altering. This mild sort of badness isn’t always the worst case, and plenty of historical examples of people passing off misleading or unfair contract terms exist. History is full of corporations and other people (#zing) who use their power to manipulate. That’s why we have laws about things like monopolies, and Native Americans are still fighting to make the U.S. honor its agreements regarding tribal lands.
Stories based on contract-signings or otherwise magically binding agreements are often reflective of power differences and discrimination in real life. In fiction, people who write contracts are evil, and want you to sign off on that shitty contract they wrote without ever reading the fine print. Then later, when you protest that you didn’t sign up for this, they can pull it out and say yes, you literally signed up for exactly this. The contract’s author is usually a wealthy villain—whether that wealth is financial or some other sort (magical ability, political power) is irrelevant. The point is, they have ultimate control over an ability or commodity, and they can dictate the terms by which that commodity is distributed. And since these contracts have magic behind them, breaking them isn’t as easy as just going back on your word.