When drafting a business contract, you should include specific information to ensure clarity, protect your interests and mitigate potential disputes.
Learn more about the key information to include in your business contracts.
Identify the parties
Include the legal names, addresses and contact information of all parties. This step ensures that you establish the identities of the individuals or entities entering into the agreement and avoid confusion or disputes.
State the purpose and scope of the contract
Define the nature of the business relationship, the services or products that the parties will provide and the specific obligations of each party. This section provides a comprehensive overview of the agreement’s purpose and outlines the key responsibilities and deliverables.
Define terms and conditions
Include specific terms and conditions that will govern the agreement. These terms cover various aspects, such as payment terms, delivery schedules, intellectual property rights, confidentiality provisions, dispute resolution methods, termination clauses and any other relevant terms that are crucial to the business relationship.
Specify performance and quality standards
Outline benchmarks, deadlines or metrics that you will use to evaluate the satisfactory completion of the work.
Outline the responsibilities and consequences in case of breach, damages or liabilities. Address who will be responsible for any losses, damages or legal costs arising from the business relationship.
Determining the jurisdiction and governance for the contract establishes the legal framework within which to resolve any disputes or conflicts. Select the appropriate jurisdiction and governing law for clarity and consistency in case legal action becomes necessary.
Including this important information in your business contracts will help you create a strong and comprehensive business contract.