A well-written contract is the backbone of a successful business. Businesses have to handle various types of contracts, such as purchase orders, warranties, bills of sales, etc. Other than that, you may also have to oversee employment contracts, confidentiality agreements, partnership agreements, etc.
For a business to run successfully and reduce the risks of lawsuits, it is necessary to draft a good contract. While you may think your contracts are written accurately, a Las Vegas Business Litigation Attorney can point out the errors that the average person may often overlook. Contracts can be complex, and it is easy to make a mistake. Here are the few common mistakes business owners usually make.
Common mistakes business owners make when drafting a contract
The one thing you must avoid in a contract is ambiguity. In order to ensure a smooth process, it is necessary for a contract to be written in clear language that is easily understandable and unambiguous. It must state the terms and conditions of the contract and especially pay attention to important sections like the payment terms.
Before you draft the contract, it is important to make sure you and the other parties are on the same page. You should only include what was discussed during the meetings and never include information or terms based on assumptions. If you are confused, do not hesitate to reach out to the party to clear things out. Make sure you first collect the information and data to be included in the contract and then verify it with the other parties before putting it in writing.
Read-made contract forms.
We cannot emphasize enough how inappropriate it is to use ready-made or Internet forms for your business contracts. There are various reasons how using these contract forms can be disadvantageous for your company.
- There are different state laws regarding contract forms. The laws of the state where the contract form was made could be different from the laws of your state.
- Contracts made in different cities or states may contain clauses that may not be relevant in your region.
- The contract is made from another person’s perspective and may not be beneficial for your particular situation.
Missing termination clause.
Every contract has a certain expiry date when the parties finally end their partnership. Not including a termination clause will keep people confused about how and because of which reasons the contract may be terminated. Although you may think the subject of a termination clause may sour relationships, it is something you should not leave out at any cost.
If you see a mistake that you have already made in your existing contracts, there still may be time to do damage control. Contact a Las Vegas Business Litigation Attorney to go through your contract and make the required changes.