Do I Really Need to Read and Understand What I Sign?
During my many years in practice, I have come across various types of contracts. Some of the contracts I have seen, have been a short as one page, and longer than 100 pages. But the one thing that remains the same, is that you can tell the difference between a well-written contract and a poorly written contract.
A well written contract is like
reading a well written story. It starts with a beginning, which sets
forth the names of the parties and the basic understanding of the
parties as to why they are entering into this contract. It has a
middle, which includes all of the terms and conditions of the
contract. Therefore, like any well written story that captivates your
attention, the details set forth in the middle of the contract are
what is critical to captivate the reader’s attention as well as to
clearly set forth the intent of the parties. Finally, it has a well
written ending that usually sets forth how disputes are going to be
resolved, where they are going to be resolved, any miscellaneous item
not previously covered in the middle of the contract, and that the
contract is binding on all parties.
Some of the mistakes that people make
when presented with a contract, is not reading the contract in its
entirety and not understanding everything it contains. Prior to
reading or writing any contract, I always recommend making a list of
things that you agreed upon with the all parties to the contract. A
well written contract should be understandable to anyone who picks up
the document. If it’s not, I always recommend not to sign the
contract because it means that it was not well-written. Don’t be
fooled by someone saying it’s just legal jargon that everyone
agrees to. Even legal clauses that should be contained in all
contracts must be easily understandable by anyone picking up the
contract, otherwise enforceability becomes questionable.
I therefore recommend that if you are
writing a contract that you make sure it is clear and understandable,
and that it sets forth all of the understandings between you and the
other party. Remember, in most cases, the only time a contract is
looked at after it signed is if there is a dispute between the
parties entering into the agreement. In some cases, you should
remember that the person reviewing the contract or agreement for the
first time will be a judge or arbitrator who knows nothing about your
company, knows nothing about the agreement between you, and is trying
to determine who followed the contract and who broke the contract in
order to make a determination as to how to legally resolve dispute
brought before them. It is for this reason that is critical that a
contract must be well written and easily understandable by anyone
reviewing the document.
If you are reading a contract, don’t
sign it unless you completely understand everything that is written
in it. Similarly, if you are writing a contract, make sure it covers
everything you agreed to and is easy to understand. In the ideal
situation, I always recommend going to a skilled commercial
transactions attorney to ensure that the contract is well written and
easily enforceable in the future. Feel free to email me with any
questions you may have about agreement at David@weinsteinlawyer.com.
Comments
Post a Comment