Many a business deal has been sealed over a handshake, with both parties taking each other’s word as their bond. But, if there’s nothing in writing and things turn sour, how do you protect yourself and your business?
Our commercial lawyers from Tallents Solicitors explain why every business owner needs to consider having formal written contracts in place for both customers and suppliers.
When is a contract, a legally binding contract? Is it when it is a written contract?
Many people think that a formal contract only exists if it has been written down and signed by both parties. In reality, this just isn’t true. Contracts can be made orally, or be proven by your dealings (on the phone, via email, sending text messages etc.) with your customer or supplier. Just because you haven’t signed a formal agreement doesn’t mean there isn’t still a contract in place that the law can enforce.
When a relationship is running smoothly, it might seem hard to justify the time, effort or costs involved in obtaining a written contract. But when there’s an issue or problem, a written contract could make all the difference between a lengthy and expensive court case or a rapid and satisfactory resolution.
A written contract will protect your rights and your business
A written contract will protect your rights, ensure you get paid or receive the services or goods you have paid for, and will limit the commercial risks of doing business. Your commercial lawyer can draft a formal written contract which will clearly set out who is to do what and by when, so everyone is clear about their rights and responsibilities.
Written contracts can be drafted for many different purposes:
- To define the structure of your business: e.g. partnership or shareholder agreements
- To define a scope of work and identify expectations and responsibilities
- Contracts of employment
- Terms and conditions for purchase or sale, whether these be services or goods
Every business is different and will need different written contracts depending on need and any applicable legislation, so getting the right legal advice can be invaluable, especially as both parties need to agree on the content.
At Tallents Solicitors we advise all our clients to have written contracts in place with their customers and suppliers, whether they deal with them face to face, or via the telephone or the internet. It gives a peace of mind that is always underestimated until it’s really needed.
Our experienced commercial litigation team at Newark can help clients with any contractual issues they may have and we can also review and advise on any risks before signing written contracts. We can also advise on any contract disputes and help clients find a resolution.