It is tempting to do business on a handshake and rely on honor and goodwill to get the job done. In our experience, having a contract adds value and sets you up for success.
1- Establishes a good business relationship: It establishes clear expectations about what is expected. Preparing a contract triggers you to discuss the finer details of the agreement. When people know what is expected of them, they are able to understand and follow their obligations.
2- Helps you to get paid: A contract sets out what work needs to be done and when you need to be paid. The contract ought to set up agreed procedures if you are not paid.
3- Helps to resolve disputes: Having a clear contract enables you to enforce your rights without needing to rely on your verbal account of what was agreed ('the he said she said factor'). As time passes, is not uncommon for two people to disagree on what was verbally agreed. This is why it is important for the agreement to be put in writing.
4- Manages your legal risks and limits liability: You can limit your liability in a contract by explicitly putting terms in place and require parties to hold insurance. A good contract specifies what happens when a fault occurs.
5- Manages your intellectual property: A common misconception clients have is that once a person pays money, they then own the intellectual property. Protect your brand and clearly state how your intellectual property may be used.
More Information
Contact Caroline Mense at Legal Enablers to discuss your contract law needs.
P: (03) 8691 3128
E: carolinem@legalenablers.com
Visit us: Level 14, 330 Collins Street Melbourne VIC 3000
Legal Enablers is a commercial legal practice in Melbourne which helps businesses manage risks and resolve disputes.
Disclaimer: The content including publications on this page is intended only to provide a summary and general overview on matters of interest. It is not intended to be comprehensive nor does it constitute legal advice. Seek legal or other professional advice before acting.