Every business makes commercial contracts if it
- sells goods
- provides a service
- uses an agent
- has shareholders who need to agree how the business is to be run
Any Agreement a business makes must be clear and practical to perform. There is more to consider than if the customer will pay £10 for X goods as there is a lot that can and will go wrong.
A commercial contract does not have to be in writing to be binding on both parties but it is much easier to all involved if it is.It saves all those arguments about what was actually agreed and what the solution is if things do not run to plan.
There are many commercial contracts any small business needs. The list is endless but includes:
- Services Agreement 2. Sales Agency Agreement
3. Supply of goods contract 4. Sub contract Agreement
5, Distribution Agreement 6. Non Disclosure Agreement
7. Heads of Terms- for potential agreement.
Every term in every Commercial Contract has alternatives available. There is an art to choosing the right one for that contract.
Beware of the wording you use in a Commercial Contract – many words have legal meanings that are not necessarily the same as everyday meanings. Taking legal documents off the internet if you are not legally trained is not a good idea.
The Example of a Commercial Contract
For a Service Contract matters to consider include
- the service
- ownership of IP created
- data protection
- health and safety
- the limit of liability
- payment terms