CONTRACTS
What is a contract?
A contract is a legally binding agreement between parties that creates an
obligation to do something, or, in some cases, not do something.
Why should I use a written contract?
At any one time, more than 90% of all corporations are involved in some kind of
business litigation, both as a Plaintiff and as a Defendant. It would appear that
corporations often use litigation as an effective dispute resolution tool. Other than
intellectual property disputes, disputes over contracts and employment are most frequent.
Why?
Most businesses don’t realize the importance of a good, solid contract, not only as
protection but also to use as a roadmap for the working relationship between the parties.
A good contract decreases misunderstandings, gives methods for working out problems,
defines the exact relationship so chance for minimal damage if and when things go awry.
Some agreements must be in writing. Generally, contracts over 1 year in length,
contracts for the purchase of goods over $500, some leases, and real estate purchases must
be in writing. Whether a particular contract should be in writing depends on the facts and
circumstances and should be reviewed by an attorney. Writing the contract down avoids
people later changing their story about what was agreed to, and helps the parties focus on
the important points.
What law governs contracts?
Contracts are generally governed by the law of the state where the contract was
written. However, through a choice of law provision, this can be modified and the laws
of another jurisdiction can apply.
What are the purposes of a contract?
The 3 main purposes of a contract: detail what both sides have to do, detail how
both sides will get paid, and give both sides a way out of the deal. If all 3 purposes are not
in the contract, it is not a complete contract. The contract should also clearly indicate
when is performance will be considered complete.
What does “breach” mean?
Kaufman Law Group, PLLC
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Suite 1350
Vienna, VA 22182
703.764.9080
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A party breaches a contract when that party breaks its end of the deal or fails to fulfill its
obligations under the contract.
What can I do if someone breaches a contract?
Most contracts are enforced in court. If the other party breaches the contract, you can go
to court to try to collect damages or obtain “specific performance.” However, some
contracts have an arbitration clause which requires any disputes to be arbitrated by a
neutral party.
What is “specific performance”?
Specific performance is a remedy that courts may use when money damages will not
remedy a breach. Specific performance is generally used when the item in the contract is
unique, such as with land or custom goods.
What should I do when signing a contract?
1. Be sure you have read and understood all of the contract. If you do not
understand it, don’t sign it until you do understand it.
2. Be sure everyone signs & dates the final page
3. Be sure everyone initials & dates each page of contract
4. Contract pages should have numbering “1 of xx pages”
5. Be sure all warranties etc. that are incorporated by reference are attached to
basic contract.
6. If the contract is a form contract, *all* entries must be filled out (If the space
does not apply use “NA” etc.)
What should a business contract contain?
1. Reasonable attorney’s fees & costs in collection;
2. A provision for interest finance charges;
3. A statement of which state law controls;
4. A statement of where disputes must be resolved;
5. The consequences of not paying, e.g., contract and warranty are void;
6. A section that defines terms carefully,;
7. A statement that only the written contract controls and that verbal statements do
not make part of contract;
8. A definition of what is the written contract with its additions etc. so that
warranties, exceptions, etc are incorporated by reference;
9. A statement that all changes to the contract must be in writing;
10. Fixed dates for completion if appropriate;
Kaufman Law Group, PLLC
8000 Towers Crescent Drive
Suite 1350
Vienna, VA 22182
703.764.9080
703.764-0014 (fax)
11. A clauses that makes clear that the parties cannot be liable for things that are out
of their control (terror, weather problems, etc.); and
12. Compliance with appropriate consumer protection laws (if applicable).
HOW KAUFMAN LAW, A PROFESSIONAL CORPORATION
CAN HELP YOU WITH YOUR CONTRACT NEEDS
The office has access to many different contracts. However, once a client requests a contract,
the specific contract is modified to meet the clients needs. The firm has written partnership agreements,
software licensing agreements, contracts for the sale of goods or services, as well as contracts to make
payments on account.
Each clients needs are analyzed individually so that the contract covers only what the client
needs. Clients can request contracts be modified in any number of ways, including choice of law
clauses, arbitration clauses, payment clauses, or any other clause a client’s situation may require.
Clients are provided a draft of the contract to review prior to the agreement being finalized.
FEES:
Fees can be on a flat rate basis for businesses with ongoing needs or those who desire a one time
contract. For businesses who desire an ongoing relationship or those with more complex needs, a
reasonable hourly rate is available. While I cannot list the rates here for competition reasons, please
feel free to call 703-764-9080 to have the fees explained to you in depth.
DISCLAIMER:
The information provided by this fact sheet is for informational purposes only and should not
be relied on as legal advice. Every case and situation is different and a lawyer should be consulted to
determine how the law is applied.
Kaufman Law Group, PLLC
8000 Towers Crescent Drive
Suite 1350
Vienna, VA 22182
703.764.9080
703.764-0014 (fax)
