Five Contract Drafting Tips
Contract law is a very tricky subject to someone who doesn’t do such transactions on an everyday basis. There are many legalese terminology and certain implications that may be contained in the writing. Often, one word can change the whole meaning of the contract. It is important to enlist a licensed attorney to assist in the actual drafting and negotiations, but there are a few tips you can do as a business owner to assist in the contract drafting.
- WRITING – whether a contract is supposed to be in writing by state law, it is always prudent to get all of your negotiations on paper. If there is ever an issue with the contract, it will be easier to defend your case if there are written terms rather than verbal allegations.
- PARTIES – make sure to include all of the proper parties and their full legal names (retain a copy of their government issued ID, such as a driver’s license, to ensure you have their name correct).
- OUT CLAUSE – always have an out clause that depicts what will happen when the contract no longer works in your favor. Its always better to negotiate this when the parties to a contract are on good terms.
- DISPUTE RESOLUTION – you should also negotiate how to resolve disputes when you are on good terms with the other party to your contract.
- SIMPLICITY – legalese terminology makes a contract look lawyerly – but contracts don’t have to be complicated to be effective.
Further, you should always read the contract, especially if you aren’t employing the assistance of an attorney in its negotiation. Once you sign on the dotted line, there is a very limited period of time where you can rescind the contract. Anything beyond that, you are stuck with the terms. A court will never allow an excuse of “I didn’t read the contract” where competent adults have signed.
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