​There are all kinds of contracts used in business. However, they all include some basic terms.

Of course, not every provision is always needed in every business sector or particular business or contract, but this list of terms still makes up those most commonly used on business contracts.

Consider adding any appropriate provisions or terms from this list to your businesses contracts:

Parties

● Businesses or individuals?

● What types of businesses (corporation?)

● The proper name of signers

● Addresses of parties

● Official titles

General Contract Terms

● Duties & right of each party

● Relevant dates, prices, and quantities

● Payment terms: lump sum, installments, COD

● Taxes

● Interest & Late Fees

● General Terms

Concerns

● Underlying assumptions

● The purpose of the contract

● Liability Limitations

● Warranties & Disclaimers

● Confidentiality Provisions

● Default

● Indemnification Agreement

● Arbitration

● Governing Law

● Notarization

● Statement that contract includes the entire agreement

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Do not delay...as your success may depend on it.


Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

Dealing with products or say trading with goods, your business contract may have a warranty clause within it. 

To define it, warranty clauses are simply a promise made by the seller to the buyer indicating that the product must work effectively for “x” time period, and if fails to deliver the required performance, the seller is required to fix it at the earliest.

For example, consider you are into the manufacturing business and a recent order required you to ship 400 units of a particular item. 

It might so happen that one of these gets damaged while shipping. In this case, you take full responsibility for the product and promise to replace it at the earliest. 

However, what if the product was damaged after delivery? Is it entirely your responsibility to repair?

Or consider that you shipped a product and there arises a problem 10 years later. 

Are you still accountable for the same and would you fix it for free?

The answer will be ‘no’ in such cases. This is why you must have a warranty clause added to your contract.

What Should A Warranty Clause Mention?

Firstly, the warranty clause must be simple, specific, and to the point. You wouldn't want to spend days finding what's written in the clause. Specificity is in the way Information is added in the clause.

For example, if the clause says that the company would bear replacement charges for the next three years, it is important to mention that outset. 

This helps avoid debate as to repair and/or replacement responsibility. .

Hence, the need is to be specific. 

In totality, the clause would notify:

Who is liable to pay the cost of returns?
Do you count business hours and days or the calendar hours and days?
Who is liable for the shipping cost?
Who will install equipment and whether or not they are chargeable and to whom?
Do the replaced pieces of equipment come with a warranty?
 
Besides this, you must mention what goods are warranted and for how long. 

Do not forget to outline situations when the company is not liable to make the replacement and that is not a production error.

Another section of the warranty clause outlines what happens if either party breaches the contract and/or the damage is due to a natural occurrence.

All in all, your warranty clause must have all this information, taking into consideration all possibilities of damage, keeping it clear and concise.

Why Is A Warranty Clause Important?

For some, a “warranty clause” is only an additional section in the business contract with little or no use. 

However, in reality, this is not the case. The warranty clause promotes reliability as well as product quality. 

It acts as a protection tool, whereby promising and assuring the customers that the company would take serious action against defective products or the ones that fail to act in the desired manner.

Legal Terms:

When creating a legal contract specifying the warranty terms, there are a few things you must be aware of.

Indemnity: obligation of one party to compensate for the loss of the other given certain situations.
Repudiate: to refuse to accept something
Assertion: Claiming something to be true.

Note that while you are creating the warranty clause, you might come across a few terms that aren't easily understandable. Research, contact a lawyer and/or the parties to make sure that the clause is in the best interest of all.

Also, you never have to be without the support and counsel of fellow business owners if you join our entrepreneur and business Facebook group. 

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​

Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

Launching your business may have been easy but running it while dealing with challenges is tough. 

Imagine creating a long successful list of your well-paying customers, only to realize that your sales staff / employees steal them away from your business. 

Doesn't feel good, does it?

This is why you must have a non-solicitation agreement duly signed by all of your top-level executives, salespersons, and employees with access to your list. 

But what exactly is a “non-solicitation agreement” and how will it help you protect your client and/or customer list? 

This article will help you with all relevant points. Starting with what is a non-solicitation agreement, what are the key pointers, and the best practices.

What Is A Non-Solicitation Agreement?

In legal terms, a “non-solicitation agreement” is one where the employees agree and pledge to stand by an agreement that states they will not solicit the company’s customers or clients for their own interest or a competitor's benefit, while they are with the company or after they leave the company.

In addition to the above, the agreement can also have a clause whereby the employee is expected not to solicit other employees to quit the job along with them and move on together to a new company. 

At times, the non-solicitation agreement is added as a section in a different agreement. It could be in a non-compete agreement, an employment contract or in a non-disclosure agreement.

In any case, if it seems relevant, you must add non-solicitation terms to your agreements

Note that the above agreements are not mandatory and if an employer wants to protect the customer list, he/she can have a separate non-solicitation agreement created. Also, there isn't any consensus as to when is the agreement signed or presented to the employee. 

Meaning you can do it at any time prior to or after someone is hired. 

Additionally, you should note that these agreements can be used also with independent contractors, consultants, and other professionals that may need access to your list to perform their work. 

That is an extra level of business protection.

Why Do You Need A Non-Solicitation agreement?

Knowing what a non-solicitation agreement is, the next question that arises is why would you need to have a non-solicitation agreement.

To answer the above, think of employees or sales staff who aren't trustworthy and might take the possibility to take away your l customers. 

The sole purpose behind the creation of non-solicitation agreements is to protect employers from being exploited by their employees (or consultants) (when they take away employees or customers to a competitors company)

It is common for the employees to leave a company to work for a competitor or to start their own business. 

Odds are the new employer would try to get the customers of the previous company. Having a non-solicitation agreement prevents the former employee from doing this. .

In simple terms, a non-solicitation agreement prevents client-poaching, keeping the customers and client lists intact.

How To Draft A Non-Solicitation Agreement?

When it comes to drafting the non-solicitation agreement, it is important to take care of the clause added, the restrictions imposed, and the reason why it is being implemented. 

An important term here is the contract terms that notifies the duration for which employees must stick to the agreement.

With that being said, the non-solicitation agreement created must include restrictions against:

Selling goods or services to the company's existing customers or potential buyers on behalf of another company.
Copying or securing a copy of the client list without authority.
Selling or sharing the client list with unauthorized third parties.

Even though the non-solicitation agreement seems to be overlooked, it is a necessary legal document and a must for companies to incorporate within their standard business contracts to ensure that employees and sales staff do not take away their potential customers.

Also, you never have to be without the support and counsel of fellow business owners if you join our entrepreneur and business Facebook group. 

Daily we share information and content for business owners. 

Click here now to join, tell us who you are, and always have the information that you need to support your company’s success. 

Do not delay...as your success may depend on it.


Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

When people who are considering starting a small business have a general counsel attorney on their side, they’re not taking a risky step, but they’re in a good position to do a safe and sound operation. If they fail before they start, most general counsel attorneys will be able to save them from a great deal of trouble.
The role of general counsel attorneys is to provide legal advice and representation to the business in any situation. They are in charge of creating contracts, advising the company on potential risks, and reviewing any major decision that their organization is about to make.

A general counsel attorney cannot be underestimated - they are vital for efficient operation of the business. Some companies are even hiring two different lawyers - one who will oversee all litigation and another who will focus on compliance with regulations and legislation, because a general counsel attorney will know every step and detail of the process of starting a business and knows how to deal with the many complexities in different kinds of businesses.

They help stave off any legal troubles, such as litigation, breaches of contract, or intellectual property disputes. They also work to help people understand the law by helping them interpret laws and regulations as they apply to their specific situation. And finally, they develop a marketing plan for their company or organization’s brand image by advising on how to promote products and services while staying compliant with any relevant laws

That’s why having someone with the legal expertise you need to successfully navigate business and legal matters is important. They should be able to give you some legal and business advice and a legal professional's opinion in regard to any concerns you must have. This makes all the difference in your success and profitability of your business.

So what types of legal representation can be afforded by a general counsel attorney? What kind of legal services that a business owner needs at times in the day? Business issues related to business ownership, management, incorporation and taxes, that are most likely to arise in business are legal services that the general counsel attorney may provide. These can include legal advice regarding your business, legal services in business matters, drafting a contract, drafting for corporate entities; and all sorts of business transactions like partnerships, limited partnerships and trusts for businesses.

Business law lawyers help guide and protect business owners, and their business assets. They draft agreements that can protect the company in any disputes or litigation or resolve situations that may arise. A business attorney is usually consulted on legal matters that may arise in business as a part of their business law practice.

Business law attorneys are sometimes called general counsel attorneys. While some argue in favor of having a general counsel in a business setting, the fact is that having someone with the legal expertise needed by business owners to protect their interests as employees, partners, and owners in addition to the business as a whole, is indeed needed; they help companies understand their obligations to the consumers and help them fulfill those obligations. This is something that many small businesses fail to do because they don’t have the funds or knowledge to hire a business attorney themselves

Thanks to them you can know about all the legal issues with your business, employees or clients before and after you start your business. Your legal counsel will be able to advise you about all financial and legal issues related to the different aspects of your company. Your business and legal matters can be handled by a common understanding and knowledge base, allowing all the parties to share legal information. This means the information gathered is useful both for the new person or company as well as you as the current professional.

If we talk about tips and tricks for starting up a new business, we almost always see that they start with the same point; every person needs to know different things and strategies when starting their business, you need to prepare yourself for a business with a lot of risks to consider (no matter the type of business you have in mind), every business should have a well-designed business plan, which is a good start, because, if you want a successful business, you should do well business planning with all important aspects covered.

Anyway, if we talk about online business, with so much information on the web it is hard to run a successful online business that actually brings profit to people. With the internet you can communicate easily with your customers and manage your sales channels, but on the other hand online customers have a lot more choices than face to face customers. You need to be aware that there are people who are more patient to use online business than those who have to face traffic, heavy crowds and long queues like in department stores, but in the end, both types of businesses must be aware of the different legal obligations that affect both

In the past, most lawyers in business were general practitioners. That is no longer the case. Today, there are specialized attorneys for every type of business. The attorneys who specialize in business law are the ones who provide services to small businesses on matters such as intellectual property law, corporate law, tax law and antitrust law.

Thanks to the above and taking into account the technology of today it’s easier for businesses to start up and get off the ground without any legal issues. For instance, you can now easily set up a company over a website or through an app, which means that many people who never would have considered becoming an entrepreneur before are now seeking out legal advice to help them with their business ventures or startup ideas

A general counsel attorney helps you convey the value of various legal projects and investments to clients in ways they’ll accept from you and to whom they should listen as they go about fulfilling your responsibilities. I mean, what’s more important than protecting the interest of your client?. The interests of your customer's business partners and the importance of maintaining customer security is as important as your business interests. 

With a general counsel attorney you’ll have a new professional at your disposal, because you know that you need effective, honest, and ethical answers to help you at every stage of your business. A strong attorney can be the difference between a win for your organization and a loss. You know that from experience. Having an attorney who is a great problem solver is often the difference between a successful outcome and a disappointment. You want to be sure you have a person you can hire to give you that problem solving. You know you need someone who makes an effort to keep up on current law, but who is always thinking about the best path for you to take. If you ever find someone who thinks like this, you know you have someone who really values your business. 

That person is valuable…you need them to be part of your business. You need to know you’re working with someone who really cares as much about your success as you do about their own. You know you have a great attorney who is always available…you need that when working on your business. You need someone who gives you the time and attention you need when you need it. You know someone would be happy to be your business partner when you’re starting out in business. You want that person to be able to add value and help you grow and develop your enterprise into a winning proposition and profitable company. You know you need someone who can be a partner without being a “partner”. 

You need to be with someone that really takes the time to help you grow without being needy, and who keeps their word. You need someone who can go to bat for you if you’re in a tight spot or in a tough situation. You know you’ve made a great decision when you realize you finally hired a person you could trust with your business. It’s never too late to make an important decision about who you trust with your business and for your business. Let’s face it… We all know the importance of a professional. When our partners or attorneys are not meeting our expectations, we want to have all the facts, and we want to make sure that we’re with the right people.

​

​Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

Ever dreaded the thought of seeing your ex-employees or ex-partners as competitors? If yes, you aren't the only one who worries about the same. 

This is where the idea of a “non-competition agreement” (or a “non-compete” for short) comes into the picture. 

Employers, who wish to protect what they worked hard to build, make it a point to have a non-compete for its employees or the business owners that are part of a partnership.

Wondering what “non-compete” is and how to effectively draft a non-compete agreement ? 

This article will help you understand these items.

What Is A Non-Compete?

To define, a “non-compete” or a non-compete agreement is a contract that binds the employees in the sense that they will not work with one of the rival companies. 

Also, the agreement restricts them from setting up a new business in the same domain, or to put it this way, employees cannot set up a similar company. 

What's important to note here is that the period for which the above stands true must be specified in the agreement.

One of the goals behind the creation of such an agreement is to prevent the employees (or partners) from sharing sensitive information with rival companies. 

In a way, the employers succeed in preserving the company's information, limiting the possibility of former employees exploiting sensitive information.

This could be anything from marketing plans, contingency ideas, trade secrets, and/or customer/client lists. 

In other words, you prevent an employer or partner, for a certain time period in a particular area, from competing against you while using your own information and property against you.

Creating An Non-Compete : Information To Be Added

Creating a Non-Compete requires a whole lot of information to be added to the contract.

Every contract must specify the name as well as the address of the involved parties. By involved, we mean to say the Protected Party (the one that is requesting the agreement) along with the Noncompeting Party (the one that agrees to the non-compete clause or contract)
The starting date and the duration for the agreement .
The reason behind the creation of the agreement
The geographic area within the agreement. It may so happen that the employee is prohibited from entering into a similar trade in New York, for instance . In this case, they can always set up their business out of the geographical region.
The compensation for signing the agreement, if any.
The individuals that are required to sign the agreement.

Drafting The Non-Compete

With that being said, we now see what is the best way to draft a non-compete clause or contract and prevent ex-partners and ex-employees from becoming your competitors.

A Non-Compete For Core Employees: Legally the conventional contract signed by every employee might not hold importance in the court as restricting everyone to work outside the organization isn't relevant. It is best to have a non-compete agreement for employees at the critical or sensitive positions.
Adhere To State Laws: Not every state abides by such an agreement in the same fashion. Even if you impose one, if it's against the state laws, it may not hold up in court.
Keep It Subtle: You need not put too many restrictions on the employees or partner. Instead, keep it short and pose as many restrictions as required.
Reminders: As and when the employee or partner leaves the organization or the partner quits the engagement, make sure you remind them of the non-compete, expecting that they would stand by it and not do things that aren't acceptable.

Keeping all the above in mind, you can now start creating the non-compete agreement for your employees and partners.

Also, you never have to be without the support and counsel of fellow business owners if you join our entrepreneur and business Facebook group. 

Daily we share information and content for business owners. 

Click here now to join, tell us who you are, and always have the information that you need to support your company’s success. 

Do not delay...as your success may depend on it.


Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

Parties entering into agreements aren't always liable to do a thing or act in a certain manner. Let's assume that the two companies, A and B, are planning to work together. If A is supposed to deliver goods to B but only after B has handed over a monetary advance, A isn't under any obligation, unless it receives the money. However, for the above to stand effective, the terms of the agreement must be clear with everything written in the best interest of both.

Keeping this as the core of the discussion, we draft this article outlining what a “condition precedent'' is and how you should set the agreement when the obligations are conditional.

What Is The Condition Precedent?

A “condition precedent” is a term that best describes an event or any condition which must pass so that the terms in a specific contract turn effective. In simple terms, it is the condition that needs to be fulfilled before imposing any obligation on the parties to act according to what has been said in the contract.

With respect to the law, the condition precedent is the stipulation outlining conditions that must be met for the successful execution of all mentioned in a contract. Business organizations often lay conditions to regulate the occurrence of activities.

Let's say, you deal in the real estate business. Every time you set out to sign a mortgage contract, it is important to first assess and determine the condition of the property. Only after the condition is met, can the parties enter into the mortgage contract.

Why Is The Contract Precedent Clause Important?

Not all contracts require you to mention condition precedent. However, the ones that have significant conditions must add a separate clause in the contract that specifically mentions the conditions and how they are implemented. This helps add transparency between the parties making it clear for all. In the event of disputes, either of the parties can bring up the contract to resolve them without any hassle.

How To Draft Contracts Effectively?

Having said that the inclusion of conditions within the contract simplifies the arrangement between the parties, what's more, important here is how the clause is added in the contract. Often, it so happens that even though the contract has conditional obligations, failure to specify them raises questions. Hence, there is the need to properly set the agreement in case of conditional obligations.

To help you with the same, here we outline a few pointers to take note of when creating the contract:

Mention The Object Of Condition

The first thing to keep track of is the object of the condition. What would cease to exist if the condition isn't fulfilled? In other words, what would come to life given that the condition is met? It is necessary that utmost care is taken when the same is added within the contract. Misinformation or incomplete information might affect the course of action in the future.

2.Specify The Condition

Make sure you are clear on what the condition is and who is expected to fulfill the same. In case there exists any tenure or duration for the fulfillment of the same, it needs to be mentioned as well. When you have everything set and written down, it becomes easier to deal with problems.

3.Breach

It is expected that if the condition isn't fulfilled, the object would cease to exist. However, it is wise to mention in the contract, the aftermath of not abiding by the condition. This helps both the parties to be on clear terms from the beginning.

Also, you never have to be without the support and counsel of fellow business owners if you join our entrepreneur and business Facebook group. 

Daily we share information and content for business owners. 

Click here now to join, tell us who you are, and always have the information that you need to support your company’s success. 

Do not delay...as your success may depend on it.


Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

Until an offer is accepted, there is no contract. So, what exactly does "acceptance" imply?

You accept an offer to enter into a contract when you click the "Place Your Order" button on Amazon.com, tell the cab driver where you want to go, or pass a $20 note to the cashier at the movies. Despite the absence of fanfare, all of these activities express acceptance: an unqualified willingness to be bound by the other party's offer. An acceptance is a requirement of a legally binding contract: without it, there is no bargain.

There Is No Acceptance If

Occasionally, one party will argue that the other did not accept an offer. If any of the following statements are true, acceptance has not occurred.

• A party's answer to an offer does not indicate whether or not they are willing to be bound. ("That sounds wonderful; I'll think about it.")
• There are strings associated with the response. ("I'll do it for $10,000 more if you'll pay me more.")
• The offer is based on false information. ("You stated that you owned the car.")

Also, if the person making the offer specifies how the other party must accept it—for example, "Call me with your response by Saturday"—the other party must accept under those terms in order to form a contract. Accepting on Sunday, in this case, will not result in a contract.

Counteroffers and Conditional Acceptance

When one party responds to an offer with extra terms or qualifications, it is usually called a counteroffer rather than an acceptance. Because it fundamentally alters the proposed contract's terms, a counteroffer is not an acceptance. In legal terms, a counteroffer is a rejection of the previous offer and the replacement of it with a new offer.

EXAMPLE

A customer requests a $1,000 cabinet, to which the carpenter responds, "OK, if you also pay for my supplies." A counteroffer has been submitted by the carpenter. In order for an agreement to be made, the client must accept the counteroffer.

The restrictions are sometimes more flexible under the Uniform Commercial Code, which governs the sale of products. Under these criteria, a qualified acceptance can result in a binding contract, even if new conditions are added, unless the changes are unexpected or difficult. "I accept your offer to sell your car," for example, "but you'll have to arrange for delivery to California rather than New York."

Acceptance by Actions

Acceptance isn't always expressed verbally; sometimes actions are sufficient. If a customer placed an order for products at a specific price and the seller replies by shipping the goods, the seller's actions indicate acceptance of the offer. Silence by itself, on the other hand—that is, when one person says or does nothing—rarely constitutes assent. That principle comes from a 19th-century English contract case in which a man promised to buy a horse and declared that "I consider the horse mine" unless he heard differently from the vendor. His assumption did not form a contract, according to the British court; the other party's acceptance had to be clearly conveyed.

Except when a consumer receives unsolicited merchandise, accepting goods that were not ordered can result in a binding contract. In California, for example, receiving unsolicited product is considered an unconditional gift that the recipient is not required to return or pay for.

Open Offers and Options

An option agreement can be used by parties who desire more time to examine an offer, such as for a home purchase. An option agreement is a contract in which one party pays for the exclusive right to accept an offer for a set period of time. This allows the potential buyer to think over the transaction without worrying that it will be snapped up by someone else or that the conditions of the deal will change in the interim.

"Cooling-off regulations," similar to open offers or options, allow consumers to get out of certain types of contracts within three days of signing them. See Nolo's article Canceling a Contract Within Three Days for additional information.

​Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!

What Is An Arbitration Clause?

An “arbitration clause” is a provision added in a contract where the contributing parties agree that in the event of a dispute, they would resolve them out of court. Conventionally, the addition of the clause within the contract indicates that neither of the parties would bring the other to a traditional court setting. Instead, the two would work out to resolve the dispute in an alternative setting. This forum helps settle disputes faster and with significant cost savings.

When such an event occurs, a third-party enters into the talks, acting as the “arbitrator”, who will review evidence and decide who should win this dispute. Whilst the settlement might include remedies for one or all the parties, the fact that it is done outside the court does less damage.

Binding Arbitration And Non-Binding Arbitration

Arbitration can be segmented into two types. Binding Arbitration is one where the decision taken by the arbitrator is final and it is a must for the parties to accept and abide by it.

Non-Binding Arbitration, on the other hand, is a type of clause which gives the concerning parties the right to reject the decision given by the arbitrator. Meaning that they have the freedom to take matters to the court and seek a final decision.

In most cases, companies prefer adding a binding arbitration clause in the contract. This is solely because the process is decisive and likely to resolve disputes faster.

Advantages Of Adding An Arbitration Clause In The Contract

While some owners prefer moving to the court, others are content with the idea of resolving them outside the court because of the benefits.

Adding an arbitration clause speeds up the process of coming to a mutual decision and resolving disputes.
This is flexible and each party has its say in it when making the final call.
Arbitrators can be selected by the parties which give them leverage to pick one who is technically sound and well aware of the topic on which they are disputing, instead of having a judge with minimal knowledge about the subject matter.
 
Drafting Arbitration Clauses: Resolving Disputes Out Of Court

Adding an arbitration clause within the contract is the best way to resolve disputes outside the court. However, a poorly drafted clause could bring more harm than good. If the clause fails to cover all possible disputes, you might end up in the courtroom, fighting over the clause arguments. To avoid this, you must take into account a few practical considerations.

An arbitration clause should mention that all disputes between parties, irrespective of the cause, are subject to arbitration. In other words, there must not be an exception in the clause. If, due to any reason, the clause accepts exceptions to the dispute arbitration clause, either of the involved parties can sue the other in court.

Hence, it is important that you take the utmost care when adding the clause or before signing the agreement. Ensure that the clause mentions that all disputes are subject to arbitration. Also, keep a note of whether the said statement isn't contradictory or contradicted by other statements in the document.

All in all, a solid arbitration agreement must have a declaration that all of the parties would, under all circumstances, arbitrate their matters. This leads to the addition of the clause, ensuring that all disputes are resolved outside of court.

Also, you never have to be without the support and counsel of fellow business owners if you join our entrepreneur and business Facebook group. 

Daily we share information and content for business owners. 

Click here now to join, tell us who you are, and always have the information that you need to support your company’s success. 

Do not delay...as your success may depend on it.


Yoel Molina, Esq. (AKA “Mo”)

​Feel free to join our WhatsApp group if you want to know more aboutt his and more!