“Jane Sachedina and I met some years ago through an association set up to help local businesses. Finding her straightforward approach refreshing, I have referred many of my clients to Jane, all with varying needs from two directors in dispute, to the buying and selling of companies at local and national level. Jane’s undoubted value for me and my clients is her unwavering integrity, keen eye for detail and professional approach, plus her ease of manner and approachability - both completely invaluable in tricky or highly sensitive negotiations. On more than one occasion, after concluding negotiations for my client on a deal, the other party contacted her to act on their behalf next time!”
Kevin Gamble, TMC Accountancy Ltd.
Contracts are very important; they protect you, your business and your clients’ interests… Without them where would we be?
First of all, does a contract have to be in writing? No, a contract does not have to be in writing but if it isn’t then it can be difficult to prove that a contract was actually created from a legal perspective and if it was, what the terms of that contract might be. It is always possible for a contract to be created by the production of a series of letters, emails and other evidence – even verbal evidence.
So why bother having a written contract? An enforceable clearly written contract means that there can be no dispute as to what was intended between the parties.
How do you create a contract? This is a very legalistic mechanism but put simply one party must be willing to sell a product or service (‘invitation’) and makes it known to the other party that it is offering to sell the product or service and on certain terms (‘offer’). The other party must make it known to the other that it is willing to buy the product or service on those terms (‘acceptance’). If the other party puts forward new, alternative terms then this is not an ‘acceptance’ but a new ‘offer’, which the first party can either accept or make a new offer and so on.
Once there has been an ‘acceptance’ then the contract is made provided that there is some agreed consideration. The consideration is usually monetary but it can be other things like an agreement to do something. At this point the contract is formed and is enforceable by each party.
So when does it all go wrong?
Are your standard terms and conditions automatically included in any contract you make? No. It must be clear in the contract that any standard terms and conditions are included as terms of the contract.
Is it good enough to put your standard terms and conditions on the back of your invoice? No. You must state in your contract that your standard terms and conditions are part of the contract. If you do not do this and simply put them on your invoice then they will not be part of the contract because they have been introduced after the contract has been made. There is no point wasting ink, time and money in putting your standard terms and conditions on your invoice. They have no legal effect.
Can my contract (including my standard terms and conditions) be in legalistic and in small print?
This depends.
Generally it is best, whatever the circumstances, to use plain English and ensure that any general terms and conditions are printed clearly in an easily readable font size. However, there are differences between contracts made with consumers and those made with businesses.
These are much more heavily regulated. If you do not comply with the regulations then parts of the terms and conditions, or even the whole contract can be unenforceable. As a basic starting point contracts with consumers must: