You draft business contracts to take advantage of opportunity and work with other professionals. Could the agreements you create become an unintended liability?
Forbes explains several ways that entrepreneurs ruin their contracts with avoidable mistakes. If you have a contract issue on your hands now, learn what may have happened and how to avoid a mishap.
Poor wording
Once you draft a business contract, have a professional proofread it to make sure you included clear wording that leaves little room for misinterpretation. No matter if you only need a contract for a minor business agreement, look over it carefully (and have all other parties read over it) to check that your message and intentions are clear before anyone signs it.
Unbalanced agreement
People enter agreements because they benefit all parties involved, not just a single individual. Contracts that take away one’s options for recourse or remedies could make others reluctant to work with you. One-sided agreements that turn into disputes that go to court make it easy for a judge to side with the person getting the unfair end of the deal. Besides the court, you must also think about regulatory agencies.
Neglected contract
Depending on your industry and its laws and regulations, you may need to regularly update your contracts. Laws change over time, so you may need to revisit and revise your contracts if enforcing them hinges on the law. On a related note, you may need to update your contract format to adhere to the latest requirements.
Contracts should bring you peace of mind, not open you to a potential lawsuit. Learn how to make the most of each business agreement you sign and create.
