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What you should know about business contracts

On Behalf of | Oct 22, 2018 | business litigation

Whether you are creating a contract for a business transaction or you are reviewing a contract before signing into an agreement, it is important to know exactly what you are signing and if the document is truly valid. In some cases, the contract may be filled with legal jargon or complex words that you may not understand. Before signing the contract, however, you should be fully aware of what you are getting into and whether the ideas involved in the contract are legally justified.

When a contract is issued by one party and then accepted by another, it is considered valid in a situation when an item or service is being exchanged. In some states, contracts must be written in order to be considered legally binding. However, California legally acknowledges oral contracts, which can be hard to prove in court if a breach in contract should occur. For example, if one party does not understand or misinterprets the terms involved in an oral contract, the verbal agreement is considered invalid.

If you are in the process of reviewing a contract, it is important to keep in mind that some contracts have an expiration date, which will allow you to consider the deal before signing. During this time, you may decide to counteroffer, or make a change in the terms of the original contract. The other party may then accept your counteroffer or revise the contract to reflect different terms.

This information is intended to educate and should not be taken as legal advice.