If you’ve ever encountered a dispute as a business owner, you probably already appreciate the importance of having a written contract. However, just as important as having a written contract is making sure that your written contract works for you and your business. With the growth in popularity of using contracts downloaded from the internet, I thought it appropriate to highlight the importance of the difference between having a “contract” and “using a contract that works”.
Often in order to save money, many small business owners may download a contract from the internet, ask me to review a contract they have downloaded from the internet, or try to cajole me into downloading a contract from the internet in order save them money. However, as a business transactional lawyer, I make it a point to inform them that my value is not in duplicating a contract but rather adding value to my client’s transactions or business by making sure their contract actually works for them.
A contract that works has to actually reflect your business and/or the specific transaction that your business is entering into. To the contrary, internet contracts, while cost effective, can’t tell you whether: (1) there are any provisions in the contract that could hurt you or your business; or (2) there are any provisions that are missing that could help you or your business. For example, dispute resolution provisions may be a part of every contract, but should vary depending on your size, location, and specific preferences. While some companies may choose arbitration for all of their disputes, some companies desire more protection by allowing an exception from arbitration for court issuance of injunctions in cases of a breach or threatened breach of confidentiality provisions or unauthorized use of intellectual property. These decisions should be discussed with a good business transactional attorney.
Business transactional lawyers can also help you make sure your contracts work by: (1) helping you take inventory of your existing contracts and the contracts that you need or should have in place for the type of business or transaction being undertaken; (2) helping you outline the areas where your written agreements are inconsistent, disadvantageous, or missing; (3) helping you come up with custom boilerplate provisions that will encompass a set of standard terms and conditions that properly protect your business; and (4) drafting form agreements with standard terms and conditions specifically tailored to your business and designed to streamline the drafting of your contracts in the future.
Additionally, business transactional lawyers can make sure your most important agreements are properly documents such as: (1) owners agreements (e.g. shareholder agreements, LLC agreements, joint venture agreements, etc.); (2) major relationships (e.g. key suppliers, manufacturers, distributors, etc.); (3) agreements protecting intellectual property (non-disclosure, confidentiality, etc.); (4) standard terms and conditions of sale; and (4) website terms of use.
There is no use having a written contractual agreement if it doesn’t protect you in the event of costly litigation. So make sure your contracts work. If you have any questions about how you can make your contracts work, please be sure to contact Mitchell-Phillips Law, P.C. at 503-471-1330 or info@mitchellphillipslaw.com.
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