Susan Barilich, P.C.
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How to ensure your business agreements are legally enforceable

Contract agreements are an important aspect of doing business, and it is beneficial for any California business owners to understand how to ensure their contracts are legally enforceable and binding. Contracts protect your interests, and when there are issues with one, it can lead to legal complications and financial losses.

You may be wondering how to ensure that your agreements are enforceable and how you can properly deal with violations of a business contract. It could be prudent for you to learn how to draft strong contracts and what steps you should take in the event of a breach or contract or dispute between parties.

Strong contracts are good contracts

Businesses use contracts for various relationships, including with employees, subcontracted workers, suppliers and many others. The terms of a contract spell out the obligations of each party, the specifics of payment and other factors that could be important to the contractual relationship.

A contract is no good if it is not legally enforceable. If it is not, a court could determine that the contract is invalid, and it could lead to significant financial loss. A court will see any of the following elements as a reason to render a contract invalid:

  • The person who signed the contract does not have the right and ability to do so and does not fully understand the terms to which is or she is agreeing. This is capacity to contract.
  • There is evidence of undue influence, misrepresentation or having the contract signed while under duress.
  • The terms of the contract are actually illegal or against a public policy, and a court cannot enforce the terms of the agreement.
  • There is a mistake in the terms of the agreement, and it renders some or all of it invalid.

Contract drafting can be complex, and it is critical to ensure the terms are correct, all parties have time to read the agreement and there are no other issues that could cause problems in the future.

Shielding the interests of your business

In the event that you deal with disputes over the terms of your contract, you can take action to ensure that all parties comply or seek appropriate compensation for your losses. By having enforceable contractual agreements, you can hold other individuals and parties accountable in the event there is an issue with the contract.

Before you sign, draft or agree to the terms of a contract, it could be smart for your business for you to better understand enforceability and what you can do to ensure you have strong agreements.

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Susan Barilich, P.C. | 535 N. Brand Blvd., Ste. 504 | Glendale, CA 91203 | Phone: 818-500-0377 | Map & Directions