Most entrepreneurs, small business owners and business owners in general are very hesitant to contact a lawyer for any help - “we’re not getting sued, so we don’t have any legal needs”. That’s the prevailing mindset regarding legal advice in general, so of course it applies to getting help with contract drafting and contract review as well.
When it comes to contracts, most businesses seem to go one of two ways - either they just don’t have contracts, or they’ve grabbed a bunch of random language off a bunch of random websites and have created contracts that have nothing to do with their business. The contracts are probably irrelevant and difficult to enforce. The problem with this is a bad contract (or no contract) can lead to a huge expense for the business, both in terms of money and time, two of your most valuable resources.
Undoing a bad contract, or a situation with no contract, will cost significantly more that getting one put in place from the start. Having a small business lawyer or contract lawyer get your agreements set up correctly at the beginning will save you money and time down the road. Here are a few ways that a business can save money using a lawyer for contracts.
Proper Drafting
It’s common for businesses to put together contracts from an online resource or a combination of online resources. The problem is none of those resources have contracts that were drafted for your specific business and what it does. They are usually ambiguous and don’t address the legal or risk issues business owners need taken care of. I recently had a client with contracts all agreed to be governed by New York law;. The issue is that it’s a Virginia based business with Virginia based clients, why would they want to be forced into settling a dispute in New York? The answer is, they wouldn’t, they just weren’t aware that’s what it said.
Dispute Resolution
Most every business owner wants to avoid disputes; they’re expensive, time consuming and usually your walking away minus a client or a vendor when it’s over, no matter the outcome. That said, there are cases when a dispute is going to happen and having a well written contract may be your best friend, and also having your guide on what to do if a dispute arises is key. Disputes happen for all sorts of reasons, some of which are regularly addressed in contracts, so you may be able to settle it based on the agreement you entered into. If you end up in court, a well written agreement that contains all the necessary clauses is going to be easier to enforce and argue in favor of. While disputes may not be unavoidable, even with a well written contract, they can be handled faster and cheaper with one.
Get the Right Contracts In Place Upfront
A business attorney can help you determine what contracts you need for your business. Having the wrong contracts in place is basically the same as not having one at all. A common example is with the use of non-solicitation, non-compete and non-disclosure agreements. These aren’t everyday agreements that business owners deal with, are often used in similar situations and sound somewhat similar. It’s common to see business owners have employees or contractors sign all of these agreements, however they are enforced differently, or in some cases not at all, in different jurisdictions, and you may not have any of the protections you think you do. It’s important to make sure you are using the right agreements at the right time.
Make them Work For You
Most of the time lawyers write contracts that are in the best interest of their clients, and if they are reviewing the other parties contract, they can look out for clauses that work against you. Why wouldn’t you want your contracts to address standing issues upfront and lean more in your favor. Your lawyer should be skewing things in your favor and regularly updating your contracts to reflect changes in the law and best practices. Conversely, if you are using the other side’s contract, your lawyer can point out ways to limit your risk, identify issues and get them addressed upfront before you sign.
Getting good advice on contracts can save small business owners huge amounts of time and headaches. There are efficient, transparent and price predictable legal services that can help with advising, drafting and regularly updating contacts so your business can stay protected as it goes about selling its products or services.
Contract management and enforcement can be tricky. Contact us to see how we can be of assistance.