Contract disputes can bring business operations to a grinding halt. Thankfully, there are ways in which to carefully craft contracts that make such disputes less likely.
When looking to draft – or sign – contracts for your business, make sure that contracts follow these guidelines.
- Get it in writing – oral contracts are sometimes enforceable, but it’s prudent to get everything related to your business in writing.
- Make it clear – whenever possible, contracts need plain language and to avoid “legalese.”
- Put in details – contracts need to be all-encompassing on their faces. They need sufficient detail that even a person or business who isn’t a party to the contract can easily understand the terms.
- Provide a scope – contracts should clearly and carefully describe the scope of performance
- Compensation – compensation is sometimes a complicated issue. Is payment due immediately? When the contract is halfway performed? At the end? Is it due in installments or a lump sum? Payment terms must be clear and set out the conditions under which payment is due.
- Provide an end date – even good business relationships end eventually, so all contracts should set out the terms of completion; leaving a contract indefinite in nature can open your company up to potential liability.
It is, of course, best for a qualified business attorney to handle contract drafting. Skilled lawyers understand the nuances of contract law, and can write them in such a way as to minimize the chances of a breach of contract action occurring or the contract being voided by a court.