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What Terms Should Be Included in a Business Contract?

Posted on in Business Law

b2ap3_thumbnail_shutterstock_120064627.jpgBusinesses use contracts for a variety of purposes, and these agreements can ensure that both parties fully understand their rights and requirements while also detailing how matters will be handled if one party fails to follow the terms of the agreement. In a previous blog, we looked at the elements needed to make sure a contract is valid and enforceable. As a follow-up, we wanted to discuss the terms that may be included in a contract to protect the parties and ensure that they will meet their obligations.

Types of Clauses That May Be Used in Business Contracts

A contract will detail the rights and duties that apply to each party, and it will also specify relevant dates, such as when work will be completed or products will be delivered. It will also include information about payment, including the amount that will be paid and the methods and dates of payments. In addition to this information, the parties may include a number of other clauses that address issues such as:

  • Severability - These clauses will ensure that a contract will be enforceable even if certain terms are found to be invalid. Without this type of clause, if one provision of the contract is found to be unenforceable, the entire contract may be invalidated.

  • Warranties - The parties may include statements detailing their qualifications for providing the goods or services addressed in the contract. For instance, one party may state that they have the necessary licenses to perform the work they will be providing for the other party.

  • Indemnification - The parties may address liability in their contract by including clauses stating that one party will not be liable for damages or losses that were caused by the actions of the other party.

  • Force majeure - In some cases, circumstances may arise that make it impossible for one party to fulfill their contractual obligations. This type of clause may address situations where a party may be affected by issues such as natural disasters or public health emergencies.

  • Restrictive covenants - The parties may seek to protect themselves by prohibiting certain actions. Clauses such as confidentiality agreements or non-compete agreements may ensure that trade secrets or proprietary information will be protected.

  • Termination - A contract may detail the procedures that will be followed if either party wishes to end the agreement.

  • Dispute resolution - If the parties encounter disagreements about issues such as violations of the terms of the contract or failure to meet certain obligations, they may wish to resolve these matters without proceeding to litigation in court. A contract may state that the parties will attempt to use methods such as mediation or arbitration to resolve disputes whenever possible.

Contact Our Broward County Contract Drafting Lawyer

[[title] can help you create contractual agreements that will meet your needs, and we will make sure to explain all of the clauses that are included in your contracts and advise you of the best steps you can take to protect your rights. To learn how we can help your business address these matters, contact our Sunrise business contract attorney by calling 754-332-2101.


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