The importance of having a written contract is invaluable and cannot be understated. They define boundaries and solutions to any potential problems and clarify legal liability.
In effect, a contract makes a promise enforceable, legally. Without a binding written agreement, it may be difficult for you to enforce a promise when obligations or expectations for a transaction are not met, or when disputes arise from the transaction.
Without a contract, it puts both individuals and businesses at risk of being accused, even falsely, of not meeting expectations or having not held up their end of the bargain. Without a written agreement, disputes, complaints, legal actions and hard feelings can occur.
With a written contract in place, both parties are protected, as both parties know what goals are to be accomplished. Misunderstandings and conflicts can be minimumized, and both parties can safeguard their interests.
A basic written contract should include the following:
Names of parties
Offer (one party makes the offer, and the other accepts it)
Exchange (this includes compensation)
Description and scope of transaction, duties or services to be performed
Timeline for performance
How payment will be made and frequency of payments
Legal boilerplate (e.g. which state’s law applies and venue)
Other important provisions can include the particulars of how to amend the contract, the process to resolve disputes, and how to terminate the relationship if a breach of contract occurs. Also, a confidentiality clause should be in place, if warranted.
Without each element of a transaction being spelled out, the contract can be full of holes that can be exploited. Anything can happen. There may be unforeseen events that one may not think about or be aware of when a contract is signed. Many written contracts contain legalese that is difficult for a lay person to comprehend. Having a contract lawyer draw up or review a contract for you can help mitigate any issues that may arise from contract interpretation, allowing you the protection and security you may need, as well as insulating you from potential unforeseen events.
Get It in Writing!
Contracts are not just for spelling out the terms for both parties, but also as a means of referencing or reminding each what their obligations are to each other. Make sure you have a knowledgeable and experienced contract lawyer on your side to protect you, your business, or your family from any unpleasant situation or litigation in the future. If you already have a contract but would like it reviewed and analyzed by a qualified person, then hire a contract review lawyer to study your written contract and make sure your bases are covered in a legal and meaningful way.