Protect Your Business Using Written Contracts
After you’ve chosen the business entity structure that is best for you, what’s the next step to achieve your good ol’ American dream? You may think all you need for a successful new business is to know your products/services, know your customers/consumers, and have a great desire and passion to succeed. Those may be key aspects, but you must also protect that dream from turning into a nightmare. Make informed decisions early and often, and don’t forget to put legal protections in place, with the help of an experienced business attorney. There are many areas where legal assistance to navigate through the laws, regulations and potential traps is wise. Some examples include: contracts and commercial leases; taxation; employment practices; franchising; risk management; real estate; government regulation; director duties and internal organization; commercial debtor/creditor rights; and intellectual property (i.e., copyright, trademark, trade name, licensing, and patents).
- Do you have goods or assets that need protecting?
- Should you have non-compete protections in place in your contracts?
- Do you need contracts for the purchase or sale of products, or the details of services rendered?
- Do you need to protect a trade secret or something unique or special to your business?
Keep in mind that when you’re selling goods and services without a written agreement, you’re creating a contract without terms that you determine in advance. It will then be left up to common contract law if you’re ever in a dispute. You’ll have much more peace of mind if your obligations and rights in your business dealings are clearly stated up front, through a detailed written agreement. Have your attorney help you draft and implement the agreements that fit your particular needs and business so you can adequately protect yourself when disputes inevitably arise.
Similarly, you also want to protect your business relationships through the use of written agreements. Is there something between you and vendors, contractors, consultants, and/or those to whom you sell goods/services that may need protecting? If so, you must have customized, written contracts setting terms that limit your liabilities, and have all obligations and expectations of performance clearly laid out. Why set yourself up to be surprised or for uncertainty?
In sum, for any business relationship, be sure to have all the important details negotiated and clearly laid out in writing ahead of time. A mutual understanding, or “meeting of the minds”, laid out effectively in an agreement can provide you not only clarity, but also great protection, should a dispute arise. And importantly, such agreements can greatly reduce the number of disputes that arise at all. With the help of your business attorney, your business contracts can be tailored to individual situations, dictate how disputes are resolved (e.g. mediation, court, arbitration) or in which venue it will be dealt with (such as your local court). In fact, a well-crafted business contract can dictate the resolution of the dispute entirely. Don’t waste time dealing with disputes on the fly. Don’t risk being liable for unexpected work and costs that could have been easily be preempted through the use of a written contract drafted by a legal professional. Just one dispute can cause a domino effect that may cost you your business. Why wait? Talk to your business attorney about how to protect your good ol’ American dream using customized contracts.
— By Keobopha Keopong, Esq., Barnes Law
Keo Keopong is an associate attorney with Barnes Law, licensed to practice law in California.
The opinions expressed are those of the author and do not necessarily reflect the views of the firm, its clients, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.