When two or more parties wish to work together and reach an agreement, they draught certain terms of service with mutual permission. In this blog you will understand how you can write a legally binding service agreement in the best possible way.
Writing a contract can be tricky as you need to take care of many things. Know on Writing a Legally Binding Terms of Service Agreement Process.
When two or more parties want to come to a consensus and do business, they write down some terms of service under mutual consent. Legal binding terms of service should always be written in a professional tone.
You need to know these seven tips to make your contract solid. Prepare your contract in such a way that you do not face any complications in the future.
7 Legally Binding Terms of Service Agreement
1. Get the Writing Simple
If you believe in Oral agreements, then you must know that they are not enforceable in front of the court of law. Though in many states, oral testaments can be considered legal, when the time comes to prove it, you cannot prove it!
Hence, you should always go for a written agreement. Written agreements are stable, and you cannot refuse any part of it as you have signed the paper. It is a solid thing that binds both of your companies and helps you propagate your business safely.
When you are writing a Legally Binding Terms service agreement, you need to keep your language simple and crisp. Though your lawyer may ask you to use some tough words or complicated terms, it is always wise to go for simple and understandable English. If your language is simple, anyone can understand that. Clear sentences in a paragraph help the readers to understand what is written in the paragraph.
2. Talk to the Authoritative Person
Most big companies send their junior employees to agreement reading sessions. They come there negotiating with you on different terms. You start negotiating with them without knowing that they are not the signing authority. If you bring forth some conditions or corrections in the legal terms of services, these employees will bring that news to their bosses.
As a business owner, you deserve something more. So, ask the employees politely about their boss and how to meet him. Keep your conditions and alteration request in front of the boss only, and do not go for the junior. If the person is a decision-maker, he will understand your points and take an interest in doing business with you. Get the Precise Terms of Service from the Experts team and Advice.
3. Pick up the Correct Name
Companies often have some sister concerns or smaller divisions under different names. While negotiating with them or discussing the project, you may have used a popular or known name. But when you write an agreement, it should be done under the company’s proper name. If not, you may have to change the whole agreement even after you have completed that.
Sometimes, companies start a project under the name of their sister concern, and the other party does not know about it. Legal names of parties should be added properly in the Legally Binding Terms of agreement; else, your business may face problems in the future. Even if you are doing business with your friends, incorporating the correct name is very important.
4. No Hidden Information
When you do business with a company, there shouldn’t be any hidden rules or information. Some companies do not spell out all information at a time. They take time initially, and after a certain point, they start telling you their different hidden ambitions. This is cheating, and companies must not practice this.
If you have discussed anything verbally, you cannot enforce that in front of a court of law. The court and the judge over there only listen to your written contract. Any plan on a verbal field is not considered an agreement in front of the court. So, keep everything in writing. You must talk to your business associates and partners about it and keep everything clearly written on paper.
5. Clarity About Payments
When you are doing business, payment must be involved there, which can be the bone of contention in the future. Thus, you have to write clearly about payments here. You have to write who is going to pay whom and what is the correct time for payment. There must be certain considerations that you need to make while making payments.
Clarity regarding payments should be there, and if you have certain conditions against payments, you have to write that clearly on your agreement paper.
If instalments are involved while paying your clients, you should mention that too in clear words. The percentage of instalments, project completion dates, at what point of the project, and after checking which points you will make the payments should be mentioned there clearly. The MSA Contract is essential for all kinds of Businesses.
You need to mention whether the payments will be done via credit card, checks, or cash. Mention everything clearly in the beginning so that you do not need to face any complications in the future.
6. Details on Disputes and Termination
It is not always possible for a party to continue the contract if the other one is unprofessional. You may have given the other party a deadline, and they keep missing those deadlines repeatedly.
This is not acceptable under certain circumstances. You are doing business here, and many other projects and things are at stake when you continue doing this.
So, write the terms of termination clearly in the Legally Binding Terms of agreement. When dealing with an unprofessional company, you should come out of the agreement without breaching it.
Also, there may be some disputes rising up while doing business with each other. You must have written down some clauses on the agreement papers about these disputes. If disputes arise during or after the completion of the project, you can follow these rules.
7. Agreements Should Stay Confidential
When doing business with a company and creating an agreement, you need to keep it confidential. Sometimes, companies do business with multiple other companies. After your agreement is signed mutually, you must not start blabbering about the terms of the agreement with other associates of yours.
The company you created the agreement with may have done business with some of your associates. They may have used some other terms there, and you must not allow your associates to go through your agreement paper under any circumstances.
Legally Binding Terms of Agreements are done under mutual considerations, and no one except the parties involved in it should know about any clauses or exceptions mentioned in them.
Conclusion
Even if you and the other company stay in different states, you can create a mutual agreement. You need to follow the rules of a particular state for that.
Talk to the local authorities, and you must understand the legal clauses and rules of the state before choosing that state law to govern your contract.
Disputes may crop up at any point; if your terms are clearly mentioned in the agreement, you may not face any complications. Finally, if you need any help creating a legally binding terms of service agreement in India, get in touch with the experts of Vakilsearch.
