Every small business owner needs to understand and be comfortable with business contracts. Whether they are the type who prefers to keep things simple and rely on a handshake and verbal assurances or one who tends to get everything in writing, every entrepreneur will at some point face a conflict where a Cleveland business lawyer will be called on to interpret and perhaps attempt to enforce a contract.
Written vs. Oral Contracts
With a few exceptions, oral contracts are enforceable; as long as the parties have agreed on fundamental terms with the intention of entering a binding agreement, a contract can exist. However, even more so than with written contracts, a Cleveland business law attorney cautions that the terms of oral contracts can be notoriously hard to prove.
A Basic Contract
To be enforceable, a contract must identify certain fundamental elements:
- The parties: a clear statement of the names and businesses involved;
- The agreement: a clear statement that the parties have agreed to exchange value for value and a detailed explanation of all the material terms, such as the performance required by each of the parties;
- The conditions: a detailed statement of how each party is expected to perform including such things as price, quantity, time of performance and termination of the contract; and
- Signature and date by the parties.
A Better Contract
A better contract contains provisions that address issues that may arise in the future. Primary among the considerations a Cleveland business lawyer recommends:
- Dispute provision: in the event that the parties face disagreement down the road, an alternative to litigation, such as arbitration or mediation, can be beneficial;
- Severability provision: if one part of a contract is deemed unenforceable, the entire contract may be voidable. A severability clause allows the offending provision to be excluded while enforcing the rest of the contract; and
- Integration provision: stating the written agreement is the full and final agreement and any oral declarations have no applicability.
Contact a Cleveland Business Law Attorney for Legal Advice
Contract disputes are an inevitable consequence of doing business. Minimize the difficulties and expense of the problem by getting experienced counsel before entering into any agreement. Call Shapero & Green at 216-831-5100.