Many people conduct business without the help of an attorney. Oftentimes business dealings like transactions and agreements seem straightforward and simple to the layperson, but the reality is these matters have serious legal implications. Whether you are conducting business without a contract or are using a contract that was not drafted by an experienced attorney, you need to be aware of the risks you are facing.
Contracts Are Legally Binding
One of the many benefits of a well-written contract is that it is legally binding. This means both parties will be responsible for holding up their end of the contract. Imagine what would happen to a business if a supplier stopped supplying crucial parts? The business would come to a complete stop. Contracts provide remedies for both parties in the event they are breached. Unfairly or improperly drafted contracts can bind parties to unjust terms. People that sign contracts before reading or without fully understanding them are putting themselves at risk of serious financial jeopardy.
How Attorneys Can Help with Contract Drafting
There are so many contract options, and chances are good you could use the wrong one without the advice of experienced legal counsel. Contract drafting lawyers will listen to your needs and know exactly the type of contract they should draft for you and what specific clauses to include. Even though contracts are required in most businesses for leases, contractors for construction projects, employment, and various other reasons, the right forms aren’t available online to suit your situation. Let’s take a look at the benefits of hiring a contract drafting lawyer.
Identify Loopholes
Lawyers who have experience working with businesses know how to spot loopholes in contracts that could expose their clients to dangerous liabilities. The main reason a contract is drafted is to protect an entity. If there were to be a future disagreement, such as overpayments on a specific date, during the drafting and negotiation phase of contract creation, your lawyer can fix any potential wording that could help the other party.
Include the Latest Legislation
In business law, regulations can change and the information you have can be so out-of-date that it negates the purpose of the contract. Contract lawyers are skilled at ensuring agreements are fair for all parties to the contract. Contracts can lead to lawsuits if any information isn’t up to date. Legal counsel will be able to write the contract in a way that will keep it unaffected by any future changes to legislation and/or update the agreement should it become necessary.
Ensure the Best Terms
You will want to be as advantaged by the contents of a contract as possible. Though contracts will outline basic terms so as not to upset the other party, certain specifics can be worded to purposefully benefit you more based on your needs or concerns. If there is something you want, it never hurts to ask your lawyer to negotiate those terms on your behalf.
Help You Understand the Agreement
Contracts can be confusing for anyone; however, it’s vital to understand what you are asking of the other party and what it will mean for your business. It is important to have a contract lawyer on your side to draft contracts for you so you can rely on their experience negotiating the terms of thousands of similar documents to serve as a point of reference to prevent future disputes.
Poorly Written Contracts May Not Be Enforceable
Some people may choose to write their own contracts or use generic contracts they find online, but these are fraught with problems. One of the most common problems with poorly written contracts is vague language. Contracts need to be written with a level of specificity, which means generic contracts found online simply won’t do because vague terms are difficult, if not impossible, to enforce.
Poorly written contracts also often lack crucial provisions, such as details on how to terminate the contract, compensation for breach of contract, and others. Depending on your business and industry, many specific circumstances must be addressed in the terms of your contracts. If these items are not addressed, you could find yourself tangled up in costly and expensive commercial litigation.
The Types of Contracts Our Attorneys Draft
Some of the most common types of contracts our lawyers have experience drafting, reviewing, negotiating, and finalizing include:
- Purchase and Sale Agreements – These business contracts establish the terms and conditions of real estate transactions.
- Dissolution Agreements – These documents nullify or dissolve another contract.
- Franchise Agreements – A franchisor will grant a franchisee the right to operate, sell, or distribute goods associated with the franchise.
- Partnership Contracts – These documents dictate how a for-profit business will operate under two parties or business partners.
- Vendor Agreements – These contracts establish a business relationship between two parties.
- Distributor Contracts – An agreement between a supplier with products to sell and another company responsible for the distribution of the products.
- Manufacturing Contracts – Contracts for a manufacturer that makes products for another corporation and obtains materials for the products.
- Employment Contracts – These traditional documents serve as agreements between employees and employers and establish the rights and duties of each party.
- Buy-Sell Agreements – These contracts stipulate how a partner’s share of a business may be reassigned should certain designated events occur.
- Service Contracts – These documents set the terms and conditions between a contractor performing a service and the hiring entity.
- Releases and Waivers – These legal documents release a party from liability and create an enforceable promise that one party will not take legal action against another.
- Property Agreements – A pledge or security of a particular property for the payment of a debt or performance of some other obligation.
- Shareholder Agreements – These contracts regulate the relationship between shareholders and the corporation.
- Company Operating Agreements – Used by LLCs, these contracts outline the business’ financial and functional decisions, such as rules, regulations, and provisions.
- Lease Agreements – These documents outline the terms under which one party agrees to rent a property owned by another party.
- Confidentiality and Nondisclosure Agreements – These agreements prevent one or more parties from disclosing confidential information.
- Non-Compete Agreements – These contracts prevent an employee from competing with an employer after their employment ends.
- Licensing Agreements – These contracts allow one party to use and earn revenue from the property of the owner.
- Master Services Agreements – Also known as MSAs, these contracts are between two or more parties and they establish what terms and conditions will govern current and future activities and responsibilities.
- Service Level Agreements – Also known as SLAs, these agreements define the level of service one party expects from another.
- Vendor and Independent Contractor Agreements – These contracts generally outline the terms and conditions of the working arrangements between a vendor or contractor and their paying client.
Houston Contract Drafting Lawyers
The Houston contract drafting lawyers at Feldman & Feldman have extensive experience drafting, negotiating, and reviewing all types of business contracts across a variety of different industries. We can make sure your contracts are legally enforceable, outline fair terms, and protect you from future commercial litigation. To schedule an appointment with one of our experienced business lawyers, contact us today.