are a vital part of every business. They protect you and your business in case of disputes, they give customers confidence that their needs will be met, and they set out the terms and conditions for doing business.
Contracts are agreements between two or more parties, legally enforceable by law.
A contract can be verbal (spoken) or written. A written contract is normally defined as an agreement that has been put in writing and signed by both parties. However, even if an agreement has not been reduced to writing, it will still be considered a legally binding contract if both parties agree. There has been some form of consideration (money or goods) exchanged between them.
Drafting Business Contracts
There are three main types of business contracts: standard form contracts, letter agreements, and ad hoc agreements. All three have their place in the world, but it’s important to know when to use each. Here’s a quick overview of each type:
Standard Form Contracts
These are pre-written documents that cover the most common situations in business. For example, if you’re an accountant and have clients who need their taxes prepared every year, then a tax preparation agreement would be the standard form for your clients.
These are short-term agreements that cover simple situations. For example, if a client needs an invoice from you today but will be paying the invoice several days or even weeks later, a letter of agreement may be appropriate here.
Ad Hoc Agreements
These are very specific agreements between two parties who don’t expect this type of agreement to happen again or don’t want it in writing because it’s unusual. For example, if two parties enter into an oral lease agreement.
Reviewing Your Contract
It’s always wise to have someone else review your contract before signing it yourself. This will help ensure its enforceability if there’s ever a dispute over its terms or conditions. It’s also important to review your contract after signing it yourself because sometimes new information comes out after signing.
Before you sign a contract, could you review it carefully? The document should include the following information:
The name of the law firm and contact information. This will be useful if there are any problems with the work performed.
A detailed description of the services you are paying for.
A list of what is included in the fee, such as photocopying and postage.
The total amount owed (including fees), when it is due and how it will be paid.
If you have questions about anything in the contract, ask them before signing. If terms concern you, make sure they are changed before signing on the dotted line. Negotiate changes by saying something like, “I’m concerned about this part of the contract — could we change it so that I get it.”
Importance of Reviewing your contract
There are many reasons why you should review the contract before signing it. The most important reason is that you can identify any potential problems before it becomes a big issue. As well as making it easier to identify issues with the contract, when you review the contract first-hand, you will understand its terms better and be able to negotiate better on your behalf if any issues arise later down the line.
The contract is a legal document, and you should be careful about making any changes that are not allowed by law.
Contracts often contain clauses that allow for changes in certain circumstances, such as if there’s a change in law or if circumstances change over time. However, changes should only be made with the agreement of both parties.
If a contract is changed without the other party’s consent, this could count as a breach of contract and possibly lead to legal action being taken against you.
It is also good practice to have a business attorney look over your contract before signing it. They have years of experience in this field and can help identify any potential issues with your contract before signing anything official.
Business Contract Modification
The contract modification process is a way to update an existing contract without starting over. Contract modifications can be made to change the scope of work, the price, the time frame, or even the parties involved. Here are some common changes that might be made during this phase:
Add or Remove Parties
If you need to add additional parties or remove one or more parties from the contract, this can easily be done in most software programs. You might also want to modify some of the terms of your agreement if you have added new people into the mix who will be affected by them (for example, if they are required to sign documents related to their duties).
Altering the Scope of Work
This may be necessary if changes in technology or materials make it impossible to meet the original requirements. For example, if you’re hiring a contractor to build a house and you discover that they don’t have experience with your type of home, you may want to scale back some of the requirements so that they can still provide quality service.
Changing Pricing for the Same Scope of Work
When there’s no change in scope or quality requirements but only a change in cost due to inflation or other factors, you may want to adjust the pricing accordingly.
Extending Deadlines or Changing Payment Terms
You may need more time than originally allotted for certain tasks or should receive payments sooner than originally agreed upon because of market conditions that affect your business model.
Parties need to understand that there are times when modifying a contract can be necessary and beneficial for both parties. However, there are also times when it would be better not to make any changes. It all depends on the situation and the needs of each party.
Get Help with the Creation and Signing of your Contacts Today!
Nonaj Law Firm is a leading provider of contract drafting and review services in the United States. We have assisted thousands of businesses across the country in creating, reviewing, and signing their contracts. We have helped companies in all industries to draft and review their contracts, including software development agreements, distribution agreements, employment agreements, consulting agreements, and more.
We offer a wide range of contract drafting and review services at affordable rates. If you want your business to grow faster and avoid future legal issues, you must get help from an experienced legal team. Our team members are well-versed with all types of contracts and know how to draft them in such a way that protects your interests and those of your clients or customers. We also provide contract review services so that you can ensure that there are no loopholes left in your agreement before signing it. Contact us today at 917-423-7259 to book an appointment.