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Verbal Agreements And Written Contracts


Building and maintaining a business isn’t an easy feat. But it can be made so much easier if every business prioritized developing concise and straightforward contracts. In this way, every party understands their duties and what would happen if they are unable to fulfill them. Some people may be uncomfortable following up a verbal agreement with a written contract, however, it’s the best approach to reducing the chances of a serious business issue happening down the line. Taking the time to write a strong contract now can benefit all parties involved. As a business contract lawyer explains, here are some things to consider when it comes to business contracts.


Put the agreement in writing.

Verbal agreements can be legally binding in some situations, but they are more difficult to enforce in court. And sometimes, they cannot be enforced at all. Even if the law does not necessitate it, all agreements should be in writing and signed by the parties involved. An agreement that is written in document form is less likely to cause problems compared to a verbal arrangement, since there is a reference tool that describes each party’s responsibilities, rights, and obligations. Without a written contract, there would not be anything to refer to if disagreements arise.


Define duties and details. 

The body of the contract should include the duties of each party in sufficient detail. Be specific and avoid using generalities if possible. If you discuss certain aspects of agreement verbally, but it is not reflected in the contract itself, then it will be almost impossible to enforce if a disagreement happens. In court, a judge may only consider what is written within an official contract, and not necessarily what was verbally exchanged beforehand. If you forget to add something to the contract, you can create a short amendment thereafter.


Be specific with payment and dates.

When devising your contract, be distinct with dates associated with responsibilities and when they have to be performed or finished by. Write the conditions for how payments need to be made. Money is often a driving force of many disagreements, particularly if one party has lost money because another’s duties were not fulfilled. Include whether payments can be made partially in installments, or only when the work is done to satisfaction. Some people may have preferences in how money is exchanged, so these details should be clearly written out in the contract as well.


Consider having a lawyer help.

A great way to avoid conflict and ensure that every party feels protected, is to consider having a lawyer help with the drafting of a contract, similar to the team at the Law Group of Iowa. Your lawyer can review a contract if you have already written one, and then make suggestions for edits so as to reduce the likelihood of confusion or disagreements in the future. If you have questions about business contracts, your lawyer can quickly answer these so that you don’t accidentally make mistakes that pose a problem later on.