First of all smart contracts have a deceiving name because they are not really smart and they are not really contracts.
But they are a really, really cool part of blockchain. At least I'm excited about it. That aside, it is as simple as a vending machine. A vending machine has a rule where you put in a dollar and you get to pick what you want from the machine. We can extend that solution to much larger dilemmas then M and Ms or Skittles. For example, we have a rule that you put a certain amount of money into the blockchain and then you are the new owner of real property. How cool is that? No real estate agent, no lawyer, no bank, no lender, and no waiting in line at the county recorder.
As always speak to an attorney first!