For years I have been encouraging clients and other professionals to make sure they enter into a written contract instead of a verbal one and a handshake.
Some people are reluctant to discuss the use of a written contract or negotiate terms to use in a written contract. These people believe that discussing a written contract may be seen as mistrusting the other party. That is a dangerous belief. Be careful if you choose not to use written contracts.
Written contracts are an essential part of business. Not only do they clarify the intent of the parties but also the obligations the parties intend to owe each other. Some contracts may go a step further and include what should happen if a dispute later arises between the parties. In the event of a contract dispute, the Courts will go to the written contract first to understand the agreement that was reached at the time it was entered into. Having a written contract may avoid a dispute all together!
Written contracts are used in all areas of business today such as in general operations, finance, purchase, sale or leasing of businesses, real estate, assets, shares and other valuables.
In construction specifically, the reason why contractors are called “contractors” is because their relationships with clients is governed so much by the use of contracts that, over time, they became known as contractors.
Not only is a written contract a great idea but the language and the words used in the contract are very important as well. Having a written contract goes a long way in proving what the intent of the parties was instead of trying to recreate what the intention was from memory especially since, by then, the other contracting party would have an opposite recollection.
It can be as long as or as short as you want but one thing is certain; having a written document goes a long way in understanding what you expect from the other party and what that other party expects from you. Your lawyer can assist you in either drafting your contracts or otherwise reviewing your contracts beforehand.
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