There is a lot of administration that goes to starting and running a successful business. In dealing with the legal aspect of the business, here are five things to consider.
With so much to do when running start-up business contracts or the legal aspects of running a business are often overlooked. Leah Molatsedi, founder of Lenoma Legal shares 5 basic contract sections that you should review carefully:
The parties to the contract.
This section of the contract is important because it tells you who you are entering into an agreement with:
– Is it another person or several people? Is it a business?
– Are you signing the contract on behalf of their business or in an individual capacity?
Are the names of all parties spelled correctly?
The “money” terms.
This section of the contract is important because it deals with the financial aspect of the business. Does it clearly lay out how much a good or service will cost? When, how much, and how long will you have to pay the other party or the other way around.?
Jurisdiction and Governing Law.
This section of the contract explains what law applies to the contract and the location where a dispute must be brought if there is a disagreement. Jurisdictions or countries may have different laws, so knowing which law applies to your contract is critical to understanding your rights.
Some contracts have a section that states that a losing party in a dispute has to pay the winning party’s attorney’s fees and costs. This is an important section to you because you may be able to get their attorney’s fees reimbursed if a dispute arises out of the contract and you win.
This section of the contract is so obvious that it often gets overlooked.
Did all of the parties sign the contract?
These are just a few of the sections that your potential client should carefully review prior to signing a contract. However, every section of a contract is important.
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