Business Contracts Templates: Everything You Need to Know
A business contracts template can help an agreement go more smoothly by spelling out the terms and conditions of a business agreement in a contract, which will lay out specific responsibilities and expectations for both the company or contractor and the client.3 min read
2. When Do You Need a Contract?
A business contracts template can help an agreement go more smoothly by spelling out the terms and conditions of a business agreement in a contract, which will lay out specific responsibilities and expectations for both the company or contractor and the client. A contract should include details such as:
- Material used.
- Procedures to complete the job.
- Procedures that will be in place to handle disagreements.
While a contract can help to keep both parties focused on the same goal and under the same impression, it can also become an important tool if a problem reaches court. Whether you are creating your own or just signing a contract, there are some contract tips that you will always want to follow:
- No matter who wrote the form, always read it thoroughly.
- Check that all details such as name, address, and contact information are correct.
- Make sure all the details listed are what you expect.
- Read all fine print and verify any language that might seem ambiguous.
- Make sure that the contract includes the four primary items that should be included in any contract, which are the offer, the consideration, the acceptance, and the mutuality.
- Get advice on any legal regulations that may apply to your situation when creating a contract.
- Make sure to include any industry associations or unions that may be involved.
- Check that any insurance, restrictions, or regulations that will be necessary to start or during completion of work are included.
- Be sure to state items even if you feel they would be obvious to anyone.
- List exact products and define any terms that are included in the contract.
- Be specific on terms, such as 30 days, by indicating whether you mean calendar days or business days.
- Include payment terms and any pre-payment or milestone payments that will be necessary throughout the job. This section should also include any late fees or interest that will accrue for late payments.
- List any insurance requirements that will need to be in place before work can begin.
- Include any processes for dispute resolution such as arbitration.
- Keep appropriate length spaces for signing and make sure there are no areas that could be filled in later to alter the contract.
- Always keep a copy of the contract and provide two contracts for signing so you each can have an original.
- Make sure to keep your contract somewhere safe in case it needs to be referenced during any future disputes.
Remember that after the contract is signed, the agreement is a legally binding contract. If you think that you have signed a contract in error, you may find some relief in an indemnity clause, which can assign blame if there is an error.
When Do You Need a Contract?
Even though oral contracts are enforceable by law, they can be more difficult, and a written contract will provide better details about what each party agreed to. When providing a product or service without the presence of a contract, you will need to have a lot of evidence to help prove what was agreed to and what happened in the event that an oral agreement goes to court. Things you will want to keep include:
- All emails associated with the job.
- All estimates quotes and invoices.
- Notes from any of the discussion.
- A log of any phone calls between you and the client.
- Copies of any documents you have related to the agreement.
Having a written contract will not only protect you in the event of a lawsuit, but it will help make your case easier to present. While having a written contract is a good idea for any agreement, there are some instances where you will want to make sure to have a written contract.
- Your work or product will require a specific type of expected quality or materials used.
- You have concerns that you may have difficulty receiving payment from the client.
- The project involves a timeline that will include payments for milestones that need to be clearly defined.
- The contract includes bonuses in the event of an early completion.
While no contractor or client wants to anticipate a legal dispute, it is better to be prepared then end up with expensive legal costs and fees trying to prove an oral agreement.
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