The overall success of your business venture will be largely determined by how effective and robust the underlying contract is. Many companies and entrepreneurs gloss over certain contract provisions or altogether neglect to put the contract in writing. Verbal contracts may be legally binding and enforceable, but it will take a significant amount of effort and capital to prove its validity. More specifically, there are several provisions and elements that are essential for a strong business contract.
- Parties. This provision might seem redundant, but it is important to list the names of all parties that are participating in the contract. Simply listing the company owners or supervising managers is not sufficient; if the business entity itself is the one actually participating then this provision should reflect that.
- Offer. The basic purpose of any business deal or agreement is for one party to offer goods, products, or services in exchange for something else (usually money). Spelling out this commercial exchange is important so each party understands what is expected of itself.
- Terms. This area of the contract is an opportunity to go more in-depth on the offer and other aspects of the deal. How much is the offering company asking in exchange for services rendered or products supplied? Will disbursement occur all at once or at set time intervals? Will benchmarks need to be met before the payee can be compensated? Having a detailed timetable for the business deal itself should also be included in this section.
- Dispute Resolution. Although parties to a business contract do not want to think about a possible legal dispute before work even begins, it can save significant time and stress by deciding on a dispute resolution method. Should a dispute arise, will both parties agree to resolve the dispute through mediation or arbitration before filing suit? Also, depending on the resolution of the dispute, will either side be reimbursed for attorney’s fees? These are questions a proper dispute resolution clause in a business contract will answer.
- Acceptance. Finally, parties must agree to the contract and sign in the appropriate space. A third-party witness or notary may be invited to witness the acceptance. The acceptance provision can also designate certain actions as acceptance. For instance, if the company providing services begins the work laid out in the contract, that could be found as acceptance.
Contact a Knowledgeable and Experienced Florida Business Law Attorney
When it comes to drafting a business contract, it is imperative to retain the services of a professional business attorney who can help you come up with a fair contract that works for you. Salas Law Firm can help your business thrive by providing quality legal services for any situation. Get in touch with our firm today.