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Drafting Business Agreements and Contracts

Business agreements and contracts are crucial elements of a successful business partnership. It is therefore important that when drafting business agreements and contracts, you have the necessary know how in making one.

Here are four things that you have to remember when drafting business agreements and contracts:

Make it simple

Drafting business agreements and contracts does not entail you to use words and phrases that neither you nor your partner can understand. You can make a good and enforceable contract by using simple, clear and easy to understand languages. It is advisable though that you use numbered paragraph headings so that the reader will have an idea on what is discussed in a particular paragraph.

Use correct legal names

When drafting business agreements and contracts, you have to properly identify the parties involved in the contract. For example, if you are to enter into a contract with a Business Inc. popularly known as BI, you have to identify in your contract that you are dealing with BI, not with the person who will sign the contract in behalf of BI. Additionally, regardless if a party is popularly known simply as BI, you must properly identify it in your contract by using its correct legal name Business Inc.

Be detailed in your contract

When drafting business agreements and contracts, it is important you give thorough details of rights and obligations of all parties involved. Even if you have already discussed and agreed things verbally, you will still need to spell out all these agreements in a contract. Remember that the purpose of writing your agreement is to make your contract enforceable. If there are necessary changes in your agreement, you can include a short written amendment. If the parties initial these changes, this means that these changes are already part of the contract. Your contract must also specify payment details and conditions when the contract can be terminated. Not to be set aside are the details on how you plan to resolve any dispute that may rise in the future.

Choose a state law for your contract

This is very important if you and the other parties in the contract do not reside in one state. You should be able to choose a state law that will govern your agreement. You have to therefore specify the location where you intend bring your legal concerns should problems arise.

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2 Comments

  • sandeep said on December 15, 2010
    sir/madam, i need your valuable suggestion regarding drafting of business agreement once you have conducted negotiations. Adelaide, Australia.
  • Betsy Byrd said on February 24, 2013
    I wish to purchase a existing Subway in Washington DC

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