Sometimes, I will have clients call me and ask, “Martin, I have someone who is not paying me for services I provided…what should I do?” to which I ask, “Do you have a written contract with the other party?” Surprisingly, the answer is “well, they are family” or “a friend of a friend.” In one instance, the parties were neighbors who coached the same high school football team for their boys. This presents an uncomfortable situation because the failure of having a written contract often results in disputes with close family and friends.
Written contracts are a part of everyday business. However, often times people and businesses overlook creating written contracts because of trade practices or familiarity with the parties involved including family and friends. Failing to have a written contract that summarizes all details of service is problematic and a recipe for disaster.
A written contract should spell out the parties involved, the scope of services or products sold, the quality requirements, the total amount budgeted, and when the deliverables are due and should describe what happens if a party fails to perform. These contract elements seem obvious. But can become a missed opportunity with a lot of disappointment, regret, and oftentimes negative financial consequences if dismissed initially.
If you are running a business, hiring a contractor, or considering a startup, please have written contracts in place to protect yourself and possibly even the other parties involved. Written contracts do not have to be elaborate. But they do have to spell out the terms of written the agreement that are important to both parties involved. Additionally, written contracts should be written in a way that is easily understood and does not require a judge or lawyer to interpret or guess the meaning of the words.
If you need help with forming or reviewing a written contract, please reach out to Fargo Patent & Business Law. Our transactional attorneys are experienced and skilled in reviewing and drafting contracts for various industries and businesses.
