Commercial

Why competent, well-considered drafting is essential

Well-drafted, succinct contracts ensure that your business runs smoothly. We all enter into contracts every day, from filling our cars with petrol to buying coffee. In business, it is essential to have contracts that are watertight and contain the correct provisions to ensure that expensive problems are not encountered further down the line.

Even though you may need to spend a small amount of money at the outset, this will save you from significant expense if competent legal advice is not sought, a dispute arises and you need to spend a great deal of money on litigation.

Commercial resilience

Commercial resilience can be maintained effectively and long-term, solid customer and supplier relationships can be established. Hence, a bespoke contract, drafted with a high degree of clarity and due consideration for the parties’ tailored requirements is imperative.

All contracts should be in writing. Although verbal contracts are legally enforceable, where conflicts arise, it usually ends up as the old ‘your word against theirs’ adage, the parties will most likely not have negotiated the issues early on, and many aspects of the contract may not be expressly agreed.

Buyer beware

Another principle to bear in mind is caveat emptor (buyer beware). Parties contracting commercially are expected to know what they are negotiating and agreeing to, and must understand their rights and responsibilities arising under the contract at the outset, whilst considering any further implications.

Legal certainty

Legal certainty and unambiguous terms are paramount in all contracts, otherwise there could be devastating repercussions for your business. For example, a court could decide that a contract term is uncertain to the extent that it cannot be relied upon, and/or a court could decide that there is no intention between the parties to create legal relations and provide for a binding agreement. Such decisions are most likely to not be in your favour.

Clarity and understanding

Clarity is one of the main benefits of having a well-drafted written contract in place. It is usually the case with verbal contracts that memories fade, parties change, and one person’s recollection of events can be vastly different to another’s. There is so much at stake in business contracts and merely relying on verbal contracts is inappropriate and very risky.

Proof of details is also provided by written contracts, namely, they provide the ultimate understanding of the mutual agreements between the parties. The contract must be detailed and the rights and duties of each party should be clearly defined, with little scope to imply terms, and the contract should account for a wide variety of issues such as performance, terms of payment, rights of termination, and rights upon default.

Such terms and clarity ensures that uncertainty is limited in the event of a dispute. Well-written contracts also improve enforceability, and clear confidentiality clauses can also be implemented to bind the parties to not disclose private information relating to the company and its business.

How we can help

If you would like our assistance to draft, review or explain contracts or would like detailed and well-considered advice on such, we would be happy to help and discuss a suitable fee mechanism to suit the needs of yourself and your business.