Contract Drafting, Negotiation & Review
Contract Drafting, Negotiation & ReviewAll contractors and small businesses need contracts. Contracts set the parameters of the relationship between businesses and their customers, clients, vendors, lenders, contractors, and the myriad of others they deal with. Contracts establish the “rules of the game,” and the Contract terms can often be the difference between making or losing money. Contracts keep people and businesses honest.
Given the importance of contracts, it is essential to have experienced lawyers in your corner. Our business attorneys have decades of helping New Jersey contractors and small businesses negotiate, draft and review contracts.
Importance of Contracts
Contracts, of course, set the basic terms of the relationship – who is supposed to do what, when they are supposed to do it, who is supposed to pay whom, and when and how much they are supposed to pay. A well-drafted contract will cover the many other details which are important to the contrac such as schedules, length of the contract, renewal options, non-compete agreements or other restrictive covenants. These terms become the private “law” of the relationship.
“Get it in writing” are words to live by in business. Oral agreements are enforceable. However, when there are diffences over what the agreement calls for, a written contract will give a formal answer to the dispute – the parties may disagree with what a written contract means, but they cannot dispute what its words are. In an oral contract, on the other hand, such disputes are the rule.
One of the best things about contracts are that they are enforceable. If a contract has been breached, a judgment can be obtained against the breaching party in court or arbitration. The judgment can be enforced – for instance, if a court orders the other party to pay but they don’t, the county sheriff can seize their property to satisfy the debt.
Contracts should also provide for how disputes should be handled. While those entering into the contract are often optomistic that the arrangement will work well and be profitable – if they weren’t optimistic, they wouldn’t be signing the contract in the first place – but real life pressure often leads to tension and conflict. Therefore, mechanisms for resloving disagreements should be included.
Given the importance of contracts, it is essential tha tyou have an experienced business lawyer on your side when the Contract is being negotiated, drafted and reviewed.
Areas Which the Contract Should Cover
The areas which contracts should cover are wide-ranging. However, some examples include these.
- Basic terms, such as services, length, cost, time for performance.
- Restrictive covenants, such as non-compete agreements.
- Protection for confidential information and trade secrets.
- Warranties and insurance information.
- Terms which comply with regulatory requirements, such as New Jersey’s consumer fraud regulations for home improvement contractors and auto dealerships.
- Forum selection clauses in the event that one party breaches the contract, such as whether arbitration, mediatior or litigation in court will be used, and where it will take place.
- Limitations on the amount of liability a party may incur.
- Collateral to secure payment, personal guarantees, and provisions for the breaching party to pay the non-breaching party’s costs of collection, including attorneys fees.
Contract Drafting & Negotiation
Our business attorneys have decades of experience negotiating and drafting contracts for contractors and small businesses in New Jersey. We meet with the managers and decision makers to ensure that we understand the business’s particular needs before beginning. Our attorneys’ experience gives us many unique adavantages. For instance, our attorneys have significant contract litigation experience, which has allowed us to see first hand many of the disputes which small businesses get into with their vendors, clients, and their own employees and co-owners, and the mistakes others have made drafting the Contracts, and the problems these mistakes have led to. Moreover, our lawyers have significant financial experience, which assists us in crafting provisions to maximize our clients’ return. Frank Nardi, for instance, is both a certified public accountant and a certified financial planner. We also have considerable experience in negotiating agreements. Maurice McLaughlin, for example, has been appointed as a mediator by New Jersey’s Superior Court to negotiate settlements to lawsuits. Our experience also allows us to draft important provisions clearly, so that disputes over interpretation can be avoided.
Frequently Used Contracts – Don’t Call Them “Form Contracts”
While many businesses need contracts which they can reuse with little alteration, we refuse to call these agreements “form contracts,” because no form can cover all the needs of an actual business. However, many contracts, especially in high volume businesses, can be standardized and readily reusable. This has the advantage of ease, but also ensuring the inclusion of required language, such as is required to comply with New Jersey’s consumer fraud regulations. Having the contract available also makes it easier to close the deal once a price has reached. Normally, we will provide the Contract in an electronic format which the contractor can use for its particular clients. However, it is important not to use “forms” that do not take into account the needs of your particular business, and which have not been reviewed for legal compliance, enforceability, and that they actually benefit you.
Our experienced contract attorneys know that every business is different and has its own unique set of needs. Therefore, our lawyers will meet with the managers, determine the actual needs of the business, and draft a contract which they can reuse.
Sometimes, however, the best service we can provide is contract review and advice. There are times when contracts are presented to businesses on a take it or leave it basis, and sometimes, while the price might be right, the legal terms in the proposed contract can create too many problems to make the deal worth it. In other circumstances, some businesses want to conduct negotiations themselves so the other side doesn’t think they “lawyered up.” However, even in these cases, it is still vital to have an experienced business attorney review the contract to ensure that it protects your business’s interests. Our attorney’s experience in New Jersey Contract law leaves us perfectly qualified to assist you in this role.
To contact our business attorneys for contract negotiation, drafting and review, call (973) 890-0004 or e-mail us. We can help.