When you run a business, there are multiple things you must account for.
Aligning strategies, finding partners, setting up offices, seeking clients and customers, you must have everything set to ensure that the business grows.
But is that enough? Have you thought about having a business contract? If not, it's high time that you work by the law and set up a contract for your business.
But what is a business contract and how do you define terms in it to avoid confusion in the long term.
What Is A Business Contract?
Business contracts are legally binding terms meant for businesses entering into monetary trade.
Irrespective of whether it is a product sold or a service provided, business contracts help outline the nature of the business, the expectancy, and the payment model among other legal clauses.
As a legal document, it is expected that all of the parties abide by all that's written in the contract. Failing the above, they can be held liable in court.
In the past, business professionals would enter into a discussion where each would mutually decide what's best, do a handshake under the impression that they would stand by it.
Even though the concept of verbal contracts still hold and are acceptable by the law, the present-day professionals prefer having the entire agreement written down in a legal document.
This makes it easier for all to understand the business and mutual promises accordingly.
Tips For Drafting A Business Contract
There are multiple types of contracts and the terms added within each vary depending upon the type.
Irrespective of the same, it is important to have all of the common terms mentioned in the best possible way to avoid any sort of confusion in the future.
Keep It Simple
True that the lawyers would embed terms such as heretofore and a party of the first part to make the contract as effective as possible, it is best advised to keep the terms as simple as possible. What's important is that the contract must be understandable. Keep paragraphs short and the sentences shorter.
Communicate With The Right Person
Before you hand over the contract to get it signed, make sure you are dealing with the right person in the organization, one who has both the knowledge and the authority to know what's best for the organization.
Only who has a vested interest in the internal matters of the organization is in the position to negotiate and come up to mutual terms.
Specify And Mention Each Term Correctly
You would be surprised to know that people often misinterpret contractual terms. If the legal terms are not specifically defined, they might end up guessing the exact opposite of the actual definition.
Hence, all of the key terms related to the business should be highlighted in the contrac, defined and also talked-about before accepting the deal.
This assures that the parties are on the same page, agreeing to everything that is being said/is written in the document.
Above all, make sure the contract lists out the payment methods, the structure, and the mode of the same.
The duration of the contract must be added gso all the parties have an idea of how long the contractual engagement will last. You should also have a clause where you mention a basis for terminating the contract.
Legal Terms To Take Note Of:
Termination: Circumstances when the contract is forced to end.
Breach: Acting in a manner that is not acceptable and against the terms mentioned in the contract.
Expiration: The day when the agreement ends legally
In the end, keep the contract confidential, and be sure that it is in accordance with state law to avoid confusion.
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Yoel Molina, Esq. (AKA “Mo”)
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Yoel “Mo” Molina, I am a lifelong resident of Miami, Fl. I am a graduate of Miami Senior High, Class of 1992, Georgia Institute of Technology, B.S. 1997 and University of Maine School of Law, J.D. 2001. I have been practicing law in Miami Since 2001. I am a former training prosecutor in the Miami-Dade State Attorney’s Office. I have experience in jury trials, appeals, and administrative hearings. I have appeared before judges across the State. My experience ranges from civil litigation matters, collection matters, foreclosure, business and corporate, contracts, real estate, leases and employment matters..
"Mr. Molina has always been there for us with timely, reliable and competent advice. He is an important and valuable part of our team." Corporate Client Eric Delgado, President of American International Export, Inc., a worldwide importer and exporter of brand name appliance parts.
"Yoel has been responsive and attentive to our company’s best interests and needs. He has been a valuable resource to our company. Any company that enlists his services would be in good hands-- including our own clients.” Corporate Client Gibran Flynn - Co-Owner and Founder of Eleva Solutions, Inc., the South Florida leader of outsourced HR, Staffing, Training, and Loss Prevention.
"My name is Anastasia Yecke Gude and I am the owner of Healing Hands Therapeutic Massage LLC. In the process of my company’s growth and expansion, I suddenly found myself a few weeks ago in need of a 1099 contractor agreement, and I needed it ASAP. As in, the very next day! I contacted the Law Office of Yoel Molina and his assistant put me in touch with Mo. I sent him what I had drafted up and he replied within a few hours with suggested revisions and clarifications, as well as a few insights I had not even considered. I was thoroughly impressed by the quality of work he provided, especially considering the time crunch I put him in (sorry, Mo!). I definitely recommend his services to anyone in need of a good contract attorney, and I will be calling him again for future work…hopefully in less of a rush next time!"