Careful consideration of contract terms helps Fort Collins business owners avoid unnecessary and costly legal disputes. Contracts spell out the parties’ obligations to one another. Business law attorneys advise taking the time to clarify duties and expectations before making any commitment.
Each side makes promises in a contract, outlining the boundaries of the business relationship. In a buyer-seller contract’s most basic form, the buyer offers money or some form of consideration for the seller’s products or services. The agreement is customized by going into specifics.
The Colorado Bar examined the terms of contracts that were potential minefields for businesses. Let’s look at a few common terms that sometimes lead to contract disputes.
Early termination clauses state how parties can be released from contractual obligations. The parties can choose to end a contract at a certain time or under particular circumstances, like a party’s convenience or a breach of contract. The terms “convenience” and “breach” easily can become ambiguous, without the proper wording and full understanding of the agreement.
So-called “evergreen clauses” make it easier for parties to continue to do business, under the original terms, without having to renegotiate agreements repeatedly. Unfortunately, many Colorado business owners are surprised by provisions included in automatic contract renewals. This problem occurs because contract terms are overlooked initially or forgotten over time.
A business contract is a binding agreement with terms that must be legally recognizable. Attorneys make sure you understand the legal implications of business contracts while assisting you with drafting these agreements.
Unless an agreement is crystal clear, there’s always a chance a person or company doing business with you can misinterpret or manipulate contract terms. Attorneys know the laws applicable to contracts and can protect you from breach of contract disputes, before they have the chance to occur. Lawyers are equally valuable when co-owners, shareholders, employees, buyers and sellers attempt to challenge contract terms.