If you have had trouble with business contracts in the past, you probably want to revise them to close loopholes people took advantage of in the past. This is a wise move. Luckily, there are many clauses you can include in a contract that might offer additional protection.
Clauses also help to reduce instances where courts might consider the contract “silent” on particular issues. With this in mind, here are four types of clauses to keep in mind, according to Forbes.
Confidentiality is especially important when working on new products not yet released to the market. Proactive businesses put these in place when hiring contractors and partnering with other businesses. You might also protect your clients from unauthorized disclosures by ensuring your employees sign confidentiality agreements.
Exiting a bad contract can become just as beneficial to a business as entering a good one. Decide what steps each party has to follow to respectfully terminate the contract, when they can do so and under what circumstances. This is also where some business owners include provisions for disputes.
One of the top reasons cases go to court is because one party refuses to fulfill the payment end of the contract. Because of this, stating the payment amount might prove inadequate. A more thorough approach includes providing a deadline, deciding on late fees and even determining the acceptable payment methods.
There is no business without risk, but some undertakings involve greater risks than others. Protect your business, yourself and your workers by doing your best to detail who becomes liable for what and under what circumstances. One type of contract where this becomes especially important is a commercial lease.
It is difficult to think of everything or to predict what loopholes your business partners, employees or even competitors might use to attempt to outsmart you. However, starting with these clauses as a base might offer you better protection than not including them at all.