Whether you are drafting a contract with an intention to join forces with another company or small business, or you are creating an employment agreement for new hires, it is critical that your document is legally enforceable should something happen and you are forced to take legal action. You have spent endless hours building up your small business and it is important to protect it from a legal mistake. While there is no specific format that must be followed when creating your document, there are some critical parts of a contract that you will want to make sure are included.
First, the contract must have an offer. This is where you state what you and the other party are agreeing upon. For instance, the offer could be a position of employment with an intended hourly pay rate or it could involve a business transaction involving the exchange of goods and services. Once the offer is in place, the contact must show that both parties understand and accept the offer. This binds the both you and the other party into a legal relationship. Lastly, something of value must be exchanged in the offer. In addition to money, the exchange could involve services, products or information.
If either party does not follow through on their end of the agreement or breaks the contract, it may be considered a breach of contract and the other party may seek legal damages.
This information is intended to educate and should not be taken as legal advice.